BEST PRACTICE CASES
Belgium (INRCT/NOVA): Productivity and Working Conditions
Denmark (DTI): Company Flexibility - the Key to Efficiency
Finland: Competitiveness, Quality and Productivity
France: Managing through Competences/Skills
Germany (RKW): Productivity and Employment
Productivity and Employment: Tony Hubert
Hungary (HPC): Productivity & Competition and Quality
Ireland (IPC): Productivity & Partnership
Italy (CPV): Productivity and Innovation and Technology
The Netherlands (TNO Work and Employment): Productivity and Work Organisation and Learning Organisations
Productivity and Environmental Protection: Tony Hubert
Germany (RKW): Productivity and Employment
The connection
On the level of the economy as a whole, productivity increases in the 19th and 20th century were accompanied by increases in employment. Corporate practices such as outsourcing, lean production, cost reduction through cuts in staffing or the relocation of jobs to "low wage countries" have contributed over the last decade to a negative relationship between productivity, growth and employment - "jobless growth" whilst productivity is continuing to rise.
Advances in productivity can thus correlate positively or negatively with employment. They lead to job losses if they are the result of pushing through a uni-dimensional productivity concept which, in the context of limited market perspectives, relies heavily on labour saving rationalisation. An alternative option is an employment enhancing productivity concept as it is described in the EANPC's Memorandum on Productivity, Innovation, Quality of Working Life and Employment.
Increases in productivity lead to more employment on condition that there is a long-term productivity concept which develops the full potential of the enterprise, but above all that of its human resources. This objective can be achieved on the one hand through "indirect" measures aimed at fostering productivity, competitiveness, growth and innovation or, on the other, through "direct" measures of employment enhancement through innovation (e.g. by using the factors of production such as knowledge, labour, capital, equipment or time more flexibly).
A promising measure for more employment through increased productivity, i.e. by optimising the use of the production factors, consists in doing away with the traditional rigid working time systems by making working hours more flexible.
Good practice examples
1. The ProContur GmbH (limited liability company) is a small enterprise employing 12 people. The company makes thin sheet metal products. It has a turnover of some DM 1,6m (EURO 818.000).
At the beginning of an RKW working time consultancy assignment it became apparent that the high quantitative output of two new machines necessitated changes to be made in the subordinate production areas as regards production capacities, staffing and production times. These requirements were in contrast to the previously rigid working hours which resulted in additional work for the jobs on the new machines and under-utilization of the existing machine workplaces.
Through more flexible working time arrangements it was possible to extend the operating time of the new machines and improve the utilization of all machines. Training and upgrading took place at the same time, improving the flexibility of the employees deployed so that it was largely possible to avoid staff bottlenecks at the individual workplaces/jobs.
The increased flexibility resulted in shorter through-put times, shorter delivery times, higher productivity, a significant improvement of competitiveness and the hiring of two new employees.
2. Engelhof Technik GmbH is a Modell- und Formenbau Unternehmen (model- and mould making enterprise) with 20 employees and a turnover of some DM 3,5m (EURO 1.789m). Its main customers are foundries and the automobile industry.
The main work-flow problem lay in passing on the outcome of the work of a specific production area to the following production area. Further problems were the interest and repayment burden for the capital-intensive machinery as well as the temporary under-utilisation of the workers when at the same time there was additional work for the skilled workforce.
The precondition for optimising machine operating times and production structures was the optimisation of staff deployment by means of training measures and a staff development scheme. A two shift system was introduced. As a result, the operating time was extended from previously 56 to 81 hours per week and the through-put time reduced by some 20% with an equivalent improvement in delivery times. Furthermore the writing-off period for the invested capital was reduced, overtime was reduced, product quality was improved and productivity increased. It was possible to hire three new employees.
Tools
The following measures aim at arranging working time, work organisation, remuneration and communication as well as training and staff development:
Literature
Ministry of Labour, Social Affairs and Health of the federal state of Rhineland Palatinate (editor):
Flexible Arbeitszeiten in rheinland-pfälzischen Klein- und Mittelbetrieben. Beschäftigung
sichern, Wettbewerbsfähigkeit stärken - Ergebnisse aus einem Beratungsprogramm.
(Flexible working hours in small and medium enterprises in Rhineland Palatinate.
Secure employment, strengthen competitiveness - Results of a consultancy programme).
Mainz 2000.
Klaus Dieckhoff:
Beschäftigung und Produktivität - Option für eine beschäftigungsorientierte
Produktivitätsentwicklung. (Employment and productivity - Option for employment oriented
productivity development).
In: Dietrich Hoß; Gerd Schrick (editor), Employment and Productivity. Münster 2000.
P. 126-131.
Questions by eMail: dieckhoff@rkw.de
