CEO Message on Productivity Month

Productivity: a catalyst for competitiveness and sustainable growth and development

October marks Productivity Month in South Africa and the theme for 2018 is “Productivity: a catalyst for competitiveness and sustainable growth and development.”
As we grapple with the changing socio-economic and industrial landscape, mainly brought about by rapid globalisation and the fourth industrial revolution, including associated disruptive technologies, we should take pride in our capability as a nation to dialogue and resolve our challenges.

It is during October that we should reenergise and refocus our energies to promote a productivity culture and mind-set and highlight both labour and total factor productivity as a catalyst for competitiveness and sustainable growth and development. This we should do emboldened by empirical evidence from worldwide studies, particularly in the most competitive economies (GCI: 2017), including Germany, the Nordic countries and Asia, that improving the levels of national productivity and innovation is the most efficient way to realise average GDP and employment growth and business efficiency while reducing the cost of doing business. Productivity levels also determine the rate of return on investment in an economy, essentially the fundamental driver of growth. Through enhanced productivity economic growth is generated and a country’s exports and trade position improve enabling it to compete globally, with skills developed and decent jobs created.

Further empirical evidence suggests that it is arithmetically impossible for a country to create and sustain wealth if wages do not grow significantly faster than inflation, which cannot happen unless productivity grows at the same rate. Therefore, it is impossible to discuss productivity without considering the contribution of labor as a major driver. Behind productivity growth are the worker, a strong work culture, and the worker working smarter.

It is therefore critical that this month our priority should be to address the issue of slower productivity growth in the productive sectors of our economy, in particular in small and medium enterprises (SMEs). If South Africa is to achieve a high-income economy, we should acknowledge and embrace productivity and innovation as the main drivers and game changers for long-term economic stability and living standards. The dialogue should also focus on the contribution of the workforce to the productivity and competitiveness of the workplace and, in general, of the economy.
We should steadfastly promote and facilitate best practices in productivity and innovation to improve economic competitiveness, with increased support for entrepreneurship and employment opportunities for youth and women, as well as SMEs. This should be with the conviction that entrepreneurs and SMEs are more likely to use innovation to develop products and services that people want or need to create decent jobs and enhance sustainable and inclusive economic growth.

As Productivity SA, we have designed our Enterprise Support Programmes to support the country’s strategic objectives in scaling up efforts to promote long-term industrialisation and transformation of the economy, targeting productive sector SMEs, with a focus on IPAP Priority Sectors.  Our Programmes and services support the Sustainable Development Goals, in particular, Goal 08: “Promote Sustained, Inclusive and Sustainable growth, full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value.”
While our economic and productivity growth have been declining since 2008, we believe focused attention on productivity, amongst other interventions, will provide the country an overarching framework to address several of the Sustainable Development Goals. For instance, greater levels of productivity (coupled to higher wages), targeting productive sector SMEs in rural and township economies, will help us “end poverty in all its forms everywhere” (Goal 1); “end hunger, achieve food security and improved nutrition and promote sustainable agriculture” (Goal 2); and “reduce inequality within and among countries” (Goal 10). Increasing productivity in manufacturing and agriculture and industrialising the rural sector and township economies requires better access to infrastructure, including social infrastructure and labour quality in terms of knowledge and skills, which Productivity SA provides to entrepreneurs and SMEs.

It is therefore important that we as a nation understand and embrace the critical and strategic role of Productivity SA in the economy, which is to lead a productivity driven growth and development agenda, including promoting and integrating a productivity and competitiveness mind-set and culture in everything we do.
Productivity SA will this October once again embark on an awareness drive. As part of Productivity Month, we will also celebrate the National Productivity Awards on 19th October at Gallagher Estate. This Awards event aims to recognise to inspire a competitive and productive South Africa.  We use the awards to galvanise all South Africans to embrace productivity as a way of life, enhance the Productivity SA brand and increase our footprint through various activities during Productivity Month. I hope to see you all at this prestigious event.
In conclusion, in the words of the former Chairman of the Japan Productivity Centre, Mr Kohei Goshi: “Productivity is a long haul, a marathon without a finish line, but so long as we have confidence and keep working at it together, we will stay in the race and ahead in the race.” 
We invite all South Africans, in particular the employers and workers of this country, to join the Productivity Movement.

Enjoy Productivity Month!
Mr. Mothunye Mothiba
CEO: Productivity SA