Productivity can unleash growth potential (2)

Mindset change is quite critical since it requires the private sector, public sector and individuals to actually switch their mindset from the norm to actually see the need to do more to be productive. This is key to be able to change to producing more or rather doing more within what you have been doing. Now, do people understand the required mindset change? Do they understand how to be efficient?

How do we transform this mindset in Botswana? How do we get the public sector to work more and understand they are producers in a production process that should be efficient and produce more with the technology, tools...at the workplace? A number of efforts are ongoing to create the awareness for the need for this mindset.

My concern is more on the realisation of this mindset change to kickstart the efficiency-productivity-growth link on the ground at the private sector, public and individual level. It is to shift the mindset to implementation to realise the end product. Existence and knowledge of strategy: its execution for effective implementation of mandates

Strategy and its execution is another important aspect that should be given priority in the reform process towards the realisation of efficiency and productivity of the private, public and household sector. Some of the reforms we see are to address and ensure that organisations effectively implement strategies and mandates.

The appropriate strategy to attain organisational objectives is crucial and clarity is essential and more importantly, the alignment of such strategies with key organisational goals and further, national goals of development and growth. Some organisations struggle with turning strategies into realisable goals in as much as they might have a well cast strategy in paper. Some organisations sometimes look like they are in separate existence with their strategy and mandate.

Here there is a problem since such organisations tend to end in chaos and in terms of the delivery aspect as one executes the strategy, it would be hard to attain resulting in many years  of lost growth since they spend time driving the wrong car. It is like someone on the wrong plane to the wrong destination since they would not reach where they are going.

That is, they would not realise the key organisational objectives without a strategy to get to the goals or without knowledge of the strategy and how it is to be executed. This is a huge cost and deadweight loss to efficiency and productivity gains to organisations, which stalls growth.

I have seen a number of changes to organisations, the rationalisations of originations and reforms to ensure efficiency in the delivery of mandates the most cost effective way. It remains important to ensure that strategies put in place can be executed and this calls for clarity in goals so that the strategy can be turned into realisable objectives.

This factor is essential in the efficiency-productivity-growth puzzle since it underscores the effective implementation of production processes at the private, public and individual level. And like the mindset milestone that has to “shift into gear” it is quite important that stakeholders know that they are pursuing a strategy, how do they execute it and do they actually realise objectives. Although it sounds simple, the lack of strategic direction emanating from lack of knowledge of strategy execution by key leaders can actually cripple organisations, in the event limiting growth potential not only for that organisation or entity but at the end negatively affecting total economic growth.

Appropriate skilled leadership and personnel and capacity for strategy execution
In the pursuit of efficiency, the need for the appropriate leadership, personnel and capacity (labour and technology) for the effective execution of the strategy is key. The point of emphasis is the puzzle that at times while institutions remain well resourced with required expertise, delivery in line with mandate\objective\goals\production still remains poor\low.

Some inefficiency still remains a limiting factor with some organisations and private sector entities not realising their goals. This is one aspect which should be given attention in the reforms towards efficiency-led growth. The most competitive countries are those that are “Efficiency led growth” (refer to BIDPA Policy Brief No 11 on Factors Affecting Botswana’s Competitiveness).

The question we should ask is on misalignment of skills with mandate of organisation. Does the organisation have the capacity to execute its mandate?

Measurement, performance indicators and monitoring
Often than not, measurement is not adequately conducted or even monitored. This requires indicators of performance in line with the strategic objectives and key goals over a certain time period. In this case efficiency and whether institutions are making advancement towards productivity gains is not clear.

The issue to address in the pursuit of efficiency productivity and growth is how we can we measure it so that five years along the line we can actually pronounce that Botswana has made strides in efficiency and productivity.Which indicators of productivity can measure or develop at the beginning to monitor progress across institutions and the public sector? How do they link with growth so that a proper framework of intervention can be effective?

Dr Tabengwa is a BIDPA Research Fellow (Macroeconomics Forecasting and Planning)