Proudfoot Consulting Global Productivity Study Shows US Companies are the Most Efficient in the...

Business Editors

NEW YORK--(BUSINESS WIRE)--Oct. 8, 2003

Proudfoot Consulting, Palm Beach Gardens, FL., a subsidiary of Management Consulting Group, PLC (LSE:MMC) today released the results of their third annual global productivity study on lost time. The global study is the

most extensive of its kind on productivity observing the managerial practices and operating systems used by over 1440 CEOs, managers and workers of major global companies from seven different countries (Australia, France, Germany, Spain, South Africa, UK, & US).

The study found that US companies are the most productive in the world along with Germany, working at an average rate of 63 percent of productivity. This level of productivity is directly tied to US companies wasting 83 workdays or $1 trillion a year. Conversely, South Africa had the lowest productivity level at 59 percent and lost 92 workdays a year. On average the study showed countries were 61 percent productive and wasted 87 workdays per year out of a potential 225 working days.

Cost of Wasted labor by country (US$), 2002

Australia

$42.72bn or 10.4% of GDP

France

$104bn or 7.3% of GDP

Germany

$224.34bn or 11.3% of GDP

UK

$132.11bn or 10% of GDP

US

$1,067.96bn or 10.3% of GDP

The study details six key factors that cause low productivity levels for each country. These factors include:

-- Insufficient Planning and Control

-- Inadequate Supervision

-- Poor Working Morale

-- Inappropriately Qualified Workforce

-- IT Related problems

-- Ineffective Communication

Of these six factors, "Insufficient Planning & Control" was the largest single cause for time lost among the countries in the study, averaging 41 percent, and nearly 30 workdays wasted in the US. "Many organizations have clear strategies, but it is the management of their resources, as well as the execution of those strategies that are the most common problems," says Luiz Carvalho, CEO, Proudfoot Consulting. "An organization's ability to handle the day to day requirements of its customers, people and vendors has a greater impact on the bottom line than the `big' problems, yet management's attention is often on the latter."

In addition, the study measured industry sector productivity among 14 industries (Telecommunications, Automotive, Travel and Transportation, Engineering, Electronics, Primary Industries, Retail/Wholesale, Paper, Chemicals/Pharmaceuticals, Textiles, Banking/Financial Services, Healthcare, Manufacturing and Food/Beverage). The industry sectors with the highest levels of global competition (telecommunications and automotive) produced the highest levels of productivity, averaging 70 percent efficiency. Conversely, industry sectors with less competition or additional government regulation (banking and healthcare) produced the lowest levels of productivity, averaging 58 percent efficiency.

The productivity levels across the countries studied averaged 61 percent of optimum capacity. This is a 2 percent rise in productivity this year compared to 2002, and equates 87 working days lost per person, per company for this year. This is five fewer days lost than in 2002.

With 225 working days per year as an optimum capacity, allowing for weekends and public holidays, Proudfoot's figures in this study are based on 85 percent of this or 191 days. This accounts for the total number of working days available after making an allowance for holidays, sickness, and training.

Proudfoot Consulting ( http://www.proudfootconsulting.com/prod_study.asp ) is one of the world's leading and longest established providers of management consultancy services. In over 55 years and through more than 16,000 assignments, Proudfoot has consistently remained an effective, practical resource for organizations seeking superior operational and financial performance. The originator of installation based consulting, Proudfoot provides organizational transformation, process optimization, performance improvement and change implementation. Implementation of financial and operational improvements is Proudfoot's core competency.