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Institute of Management Services News

Renault Korean factory has low productivity

Workers at the Renault Group South Korean factory have been told of the need to increase production and reduce manufacturing costs in order to stay afloat amid the coronavirus crisis.

Last year, Renault Samsung Motors Corp. promised to improve productivity at the Korean plant to win export volumes of the XM3 SUV for European markets. 

 

Currently manufacturing costs per unit at the Korean plant are two times higher than the Captur SUV's cost-per-unit at (Renault's) Spain plant. The XM3 and the Captur share the same platform, and the XM3 is sold as the New Arkana in Europe.

A Renault executive has indicated for the survival of the Korean plant three things should be guaranteed: high quality, reasonable manufacturing costs and in-time delivery to global markets.

 

Posted on: 14 Feb 2021@18:27:43, updated on: 14 Feb 2021@18:27:43.

 

UK Productivity Growth

UK productivity growth has lagged behind that of other comparable economies since the 1970s and the country has suffered virtually zero growth in labour productivity since 2008, the latter known as the UK "productivity puzzle". By 2016, the output per hour worked in the UK was  16.3% below the average of the rest of the G7 countries – although this has improved following adjustments to how labour input is measured.

There is some hope for the UK economy. In recent years, skills have improved at every skill level and are expected to continue to do so. High skills are already relatively abundant – 46% of adults aged 25-64 have some form of tertiary education, compared to an Organisation for Economic Cooperation and Development (OECD) average of 37%. Meanwhile, in 2015, 13% of UK university students were enrolled in science, technology, engineering and maths (STEM) subjects, compared to an OECD average of 6%.

Posted on: 13 Feb 2021@15:19:17, updated on: 13 Feb 2021@15:19:17.

 

Home working increases productivity

One of the most striking responses to the COVID-19 pandemic has been the sudden shift of around half the workforce to working at home.

Contrary to what might have been expected, working from home was one part of the pandemic response that went remarkably smoothly. Most kinds of office work continued almost as if nothing had changed.

Discussion of the crisis has involved the assumption that a return to something like the pre-crisis “normal” is both inevitable and desirable.

But the unplanned experiment we have been forced to undertake suggests we might have stumbled upon a massive opportunity for a microeconomic reform, yielding benefits far greater than those of the hard-fought changes of the late 20th century.

The average worker spends an hour on commuting every work day. Remarkably, this is a figure which has remained more or less stable since Neolithic times, a finding known as Marchetti’s Law.

If working from home eliminated an hour of commuting, without changing time spent on work or reducing production, the result would be equivalent to a 13% increase in productivity.

Posted on: 13 Feb 2021@15:04:00, updated on: 13 Feb 2021@15:04:00.

 

Productivity Hampered by Low Data Literacy

Employers can increase their efficiency and grasp new opportunities by improving data literacy skills in the workforce. A report  by Questionmark the online assessment provider, warns that without strong data literacy, organizations will struggle to make sense of the wealth of available data.

Employers have access to more data than ever before according to the new report, “Continuous skills improvement”. This data can help them make decisions on marketing their products and services and enable staff to be more productive.

But to make the right decisions from the data, people throughout the organization must know how to understand it and how it applies to their role.

Research indicates that only 21% of global workers believe they have the requisite skills to read, understand and apply data effectively.

To enable staff to make the right decisions from the data, employers must ensure:

  • High data literacy among managers – having access to data is only helpful if decision makers know how to understand the information in front of them
  • Leaders think critically – as external circumstances continue to change, decision makers must interrogate data and challenge assumptions
  • Hirers recruit data-literate employees – recruiters must hire people with strong data skills or the aptitude to develop them

Posted on: 1 Feb 2021@13:41:18, updated on: 1 Feb 2021@13:41:18.

 
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