Today we released the 2010 report of America’s Most Productive Companies, aka AMPC. You may be wondering why there is so much hype behind this study. Let me explain.
We grouped companies into 175 sub-industry groups to produce a more meaningful analysis. Our assumption is that companies competing in the same industry generally go about their business and recognize revenue in a similar manner, while different industries have differing degrees of labor intensity. It is therefore difficult to draw meaningful conclusions by comparing labor productivity across different industries such as retail and financial services. This means that the most meaningful measures included in the study are the rank orderings and comparisons within each sub-industry group.
How we measure productivity
In economics, “productivity” is a measure of output per unit of input. In order to calculate productivity, we analyzed financial data from over 1,666 publicly traded companies in order to determine a company’s revenue and number of employees. Once we had these two numbers, it was fairly simple to calculate a company’s labor productivity.
Attributes of America’s Most Productive Companies
Once we finished gathering and analyzing the data that allowed us to rank America’s Most Productive Companies, we completed some follow-up research on a number of the most productive companies. This consisted of a survey and interviews with select executives. Our follow-up research helped us identify a number of best practices that we believe explain outstanding productivity. These ten key attributes can be further categorized into five “People Attributes” and five “Strategic and Operational Attributes.” Since we are a people-centric company, we only elaborate on the people attributes – because we can help you improve those factors.
People Attributes that Make a Company Productive
1. Performance-driven culture
2. Effective managers
3. High employee utilization
4. High employee effectiveness
5. Encouragement of innovation
So what does this mean? It means that actions are valued more than words. It means that companies invest in information and tools to help front-line managers better understand their people and how they are motivated. And, it means that employees are in jobs in which they can naturally excel, and they have clear goals to help them focus on the outcomes that matter most to the organization. Failure is not discouraged and open communication, team work and risk taking help drive productivity.
