How to make efficiency part of our daily workflow

Steve Stannard is a former Massey University academic and small business owner in Palmerston North.

OPINION: In exercise physiology we talk about efficiency in terms of movement. It is defined as the amount of external work done per unit of energy that is expended.

For example, an efficient cyclist will go farther along the road than an inefficient one for the same amount of energy used. Provided, of course, all other things like bikes, body size, speed, and road surface are equal.

If we think about motor vehicles, broadly, a more efficient engine will enable a car to go further for the same energy content of fuel that goes into it.

In reverse, a car or other bit of machinery which is inefficient, can expend vast amounts of energy and perform little external work.

That is, there is little gain to show for the energy or effort that is put in. Think of sitting at a set of traffic lights with the car engine running.

People can be efficient or inefficient too. In fact, we are often told by economic ‘’experts’’ that we Kiwis are inefficient workers. That is, we produce relatively fewer goods or products than other nations for the same level of work we do. And that, apparently, is why our wages are low.

According to a 2016 report by MBIE, New Zealanders have “high numbers of hours worked, high employment and favourable policy settings which predict that incomes should exceed the OECD average by 20%”.

“But New Zealand’s income levels are more than 20% below the OECD average,” the report states.

In other words, most of us spend long hours at the workplace, and we should get paid well, but we don’t because we are not efficient.

So why are we inefficient? It’s something I’ve thought much about and asked many people about to try to get an idea because it impacts on what we as a country can spend on health and education.

The explanations that MBIE give are:

• The small size of the economy and distance from world markets.
• A firm size structure where very large (productive) firms are scarce.
• Relatively low levels of investment in business research and development.
• A high relative cost of capital, with high average long-term interest rates compared with other OECD countries.
• Low levels of competition in some parts of the economy.

Some of these things, like the fact that we are at the arse-end of the world, we cannot change. And our population will never be that of similar-sized Japan, I sincerely hope.

At an individual or small/medium business level, all of these MBIE explanations are beyond our control, so how can we, as individual workers and small business owners help make NZ more productive, with around the same amount of input?

From my perspective as a small business owner it comes down to improving day-to-day work-related efficiency.

Think of those endless meetings where there are no tangible outcomes, except another meeting next week. Or the increasing number of hi-vis vest-wearing people walking around aimlessly at roadworks sites.

There are lengthy consultation processes where the outcome is already pre-determined. Management by paper-based policy sent via email which just gets ignored.

People in management positions who just create work for themselves by mandating any of the above. High staff turnover (churn) which decimates institutional knowledge. And, of course, losing your best worker to greener pastures (or Sydney).

Worst of all is when government introduces some big initiative requiring a whole lot of minions to do massive amounts of work, but then reactively reverses or changes that initiative because of a bit of external pressure.

This naturally happens when there is a change of government, and in NZ our three-year election cycle means that it happens more frequently than elsewhere.

One of the things I learnt from the sport of cycling is you need to be always concentrating on where you are in the peloton, so you can save every ounce of energy, so you can be as efficient at possible.

It means that you will have more energy left when it gets hard towards the finish. Look after the joules and the kilojoules will look after themselves.

For my little cafe business, gains in efficiency include riding my cargo bike into work to avoid petrol and parking costs; looking for specials when buying food, regular self-servicing of equipment where I can, and minimising food waste through flexibility and timely preparation.

We should all be thinking about how we can be more efficient in our workplace, not just for us as individuals or our small business, but also for NZ going forward.

Because we need to be going forward at a time when the country seems to be stuck at the traffic lights while the engine is still running.