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Australia faces widening productivity gap


Australia’s productivity gap, the difference between productivity expectations and action, has widened from 29 per cent in 2009 to 34 per cent this year, according to research released by Telstra.
 
This is the second consecutive year that Telstra has conducted research on productivity, producing The Telstra Productivity Indicator: “A report on attitudes and behaviours toward improving productivity in Australia.”
 
Telstra enterprise and government group managing director Nerida Caesar said the study supported the findings of the Australian Government’s third Intergenerational Report, which warned that falling productivity could see long-term economic growth fall to 2.7 per cent over the next 40 years, compared with a historic average of 3.3 per cent.
 
”The report shows that organisations focused less on productivity during the economic downturn, even though the challenging conditions were a perfect opportunity to improve productivity by working more efficiently,” Ms Caesar said.
 
The Telstra Productivity Indicator 2010 report examines attitudes and behaviours to productivity in large enterprise and government organisations and explores the link between information and communications technology (ICT) and improving productivity.
The new research found:
  • Improving customer service and productivity are the key priorities for Australian organisations, ranking 78 per cent and 76 per cent respectively.
  • Only 42% of decision makers measure productivity, have a target and know what that target is compared with 49% in last year’s report.
  • ICT investment is seen as the most important contributor to improving the productivity of organisations with 55% of those surveyed identifying it as having contributed to productivity gains in the last 12 months.
  • Whilst organisations place a high priority on ICT investment, only 34% of organisations believe that ICT deployment is greatly aligned with the needs of worker groups to maximise their productivity. Those organisations that place greater importance on aligning ICT deployment with worker group needs are more likely to pursue productivity improvements.
  • The top five ICT investments for improving productivity focus on network-based capabilities including access, wide area networking, network coverage and speed, information and resource sharing and flexible/remote networking.
Ms Caesar said the Telstra Productivity Indicator 2010 report revealed that productivity gains could be achieved only through a systematic and targeted approach to address the issue.
 
“Last year the productivity gap widened, as organisations were influenced by a number of external factors, such as a shift in consumer confidence, contraction in demand for some products and services, and uncertainty on the duration and severity of the global downturn.
 
“The next 12 months presents significant opportunities for organisations to better manage, measure and invest in productivity improvements. To do this, they require clear management, improved measurement tools and strategic investment in ICT. Businesses that have a clear execution plan will be in a stronger and more competitive position for the year ahead,” Ms Caesar said.
 
The full report can be downloaded at: www.telstra.com/productivity

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