Productivity Growth and Tech Investment: Ouch

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After years of telling clients that investments in new technology can improve productivity (through its Total Economic Impact consulting service), Forrester has recently run the numbers on productivity growth and tech investment in the US and concluded the link isn’t working. The new Forrester report concludes that productivity growth in the US has “stagnated across virtually all industries despite increases in tech spending.” As per the chart from the Forrester report, while productivity growth has plateaued at 1% over the past decade, growth in tech investment over the same time frame has averaged 5%.

Ouch.

productivity growth and tech investment in US

Source: Forrester

The past decade (and a bit) has seen the market introduction of:

  • (2008) Apple introduces the App Store for iOS
  • (2010) Twitter users sent 50 million tweets per day in February, up from 100 million per quarter in 2008 (about 1.1 million per day)
  • (2011) Microsoft introduced Office 365 in June
  • (2012) Facebook‘s went public with its IPO
  • (2013) Slack’s team messaging service was released
  • (2015) Workplace by Facebook was introduced in pilot mode
  • (2018) Microsoft released Microsoft Teams in March, after announcing it late the previous year

Something isn’t working, and it appears that it’s us. Despite all the investment in software and tech equipment, we aren’t delivering the more that’s being sought.

Why is this?

  • Many of the above tools are designed as interruption factories, not places of productive, sustained and focused work.
  • More generally, the embrace of open plan offices has created a chatty, noisy and unproductive environment for work.
  • Many workers feel disengaged – passively or actively – and where there’s a lack of engagement, the true fruits of productivity are hard to grow and flourish.

Productivity growth is a good thing for an economy, an organisation, and for people too. It means you are creating greater value – becoming better, becoming more valuable, and helping more people. But perhaps we need to reshape the pursuit away from a direct goal to productivity to an indirect outcome of many other triggers, starting with purpose, creating the conditions for productive and creative work, and a re-emphasis and re-empowering of people, not machines.

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