According to the World Economic Forum thinktank¹, Britain is currently the 10th most competitive economy in the world, based on an amalgam of 100 different indicators that range from the quality of infrastructure to the flexibility of labour markets.
The UK has long been regarded, however, as having a poor labour productivity performance: the ‘UK productivity puzzle’, as it is sometimes referred to, has become a significant source of concern to policy-makers and, more generally, an on-going subject of research, analysis and debate.
In a highly competitive environment, there is a business imperative for decision-makers to explore ways of enhancing the operational efficiency, productivity or competitiveness of their organisations. Perhaps most importantly, though, it is crucial they identify and prioritise the improvements that will make the most difference. There are many different routes that can be explored: some, however, may be more risky in practice than others; and some may be more effective in their impact on the operational performance of the organisation.
QBE has been monitoring business perceptions of risk, and the associated corporate risk management agenda, since the latter part of 2013 and is pleased to share the findings from this, the fifth, wave of its Business Risk Sentiment Survey. Interviews with 375 key ‘risk’ decision-makers from small, medium sized and larger businesses were conducted in November and December 2015.
As well as continuing to monitor some of the key trends in business risk, which have an important influence on business confidence and investment intentions, the focus of the latest survey has been on exploring the issue of business competitiveness - drawing both on companies’ operational performance initiatives as well as on their workforce strategies.
The overriding conclusion from the research is that there has been a lot of recent activity by UK businesses to respond to the challenge set by highly competitive markets. Nevertheless, there appear to be relatively few initiatives being undertaken to improve operational efficiency or productivity that are proving ‘very effective’ in practice. Many companies are indeed achieving a degree of performance improvement through the initiatives they are implementing. However, the key question is whether the improvements being achieved are sufficient given the testing environment in which businesses are competing.
¹ As reported in the Guardian, 30 September 2015