Promar managing director Neil Adams believes focussing on labour productivity can bring big benefits. Labour productivity is a major driver of profitability. Promar research shows a threefold difference in labour productivity between the top and bottom quartile farms. Labour efficiency ranges from 150 litres/ hour are working on the least productive farms to over 450 litres/hour on the most productive. This difference is worth over £50,000 on an average sized farm, yet labour productivity is the least understood, least talked about and least developed part of farm management.
In most industries people management is the overriding priority of senior management. Yet in agriculture, untangling the complexity of labour productivity and making improvements often appears to be misunderstood and forgotten.
Our experience is that increasingly the most successful farm businesses will be those with excellent people management practices in place that support and build high levels of labour productivity.
The employment arena is changing with social, economic and legislative forces shaping this change. People and skills shortages, complex processes and equipment and a younger workforce with higher expectations about the type of business they want to work for will drive the need for higher skills and reward. The customer requires more quality and the economic drive for efficiency is not going to disappear. Over time legislation governing employer/employee relations and the rights of employees and employers in the workplace has developed into can of worms.
You can accommodate and benefit from these challenges by making people management a key strategic priority for your business.
Being productive is about doing more in less time: working smarter, cutting out waste, and using technology to bring about improvement. If we have disengaged employees, treat them as adversaries and give them menial jobs without autonomy, excitement or accountability, then the end result is low performance, high staff turnover and more stress. If we create an engaged workforce where people grow and develop, where they are involved in making important decisions and where they are as committed to results as the business owners the success of the business will follow.
Making it Happen
Our consultants work with a range of farming businesses with differing
scale and complexity to increase labour productivity, efficiency and
improve lifestyle for all involved. In so doing they tackle areas including:
- Developing a mindset passionate about building a productive and rewarding workplace and developing staff within this. For example, while the old mindset might be thinking about the cost of training someone who then leaves, the new mindset focusses on thinking about what it will cost if you don’t train someone and they stay.
- Helping the owner/manager recognise that they, as leader, are going to determine the extent to which any change is a success or a failure and that they will probably need to develop their own skills as much as, if not more than the employees.
- Creating a work environment that encourages people to give their best because they want to due to a combination of reward, benefits, recognition and the entire work experience.
- Working with other professional help to ensure changes are legal and that proposals are realistic, feasible and acceptable.
- Involving employees in the process, encouraging them to have ideas and recognising the value of these ideas.
There is no doubt that labour productivity is the key element to unlock
the potential of farm businesses so making it a priority should
be high on your agenda.