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People and Productivity

IMPROVE
YOUR BUSINESS

People and
productivity

International Labour Office

This is an open access work distributed under the Creative Commons Attribution-ShareAlike 3.0 IGO License
(http://creativecommons.org/licenses/by-sa/3.0/igo). Users can re-use, share, adapt and build upon the
original work, even for commercial purposes, as detailed in the License. Any new works that use the original
content must carry the same CC-BY-SA licence. The ILO must be clearly credited as the owner of the original
work. The use of the emblem of the ILO is not permitted in connection with users’ work.
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All queries on rights and licensing should be addressed to ILO Publications (Rights and Licensing), CH-1211
Geneva 22, Switzerland, or by email to [email protected].

International Labour Office

Improve your business (IYB): people and productivity / International Labour Office, Enterprises Department.
- Geneva: ILO, 2015

ISBN: 9789221287506; 9789221287513 (web pdf ); 9789221287414 (set)

International Labour Office Enterprises Dept.

enterprise development / human resources management / management development / small enterprise /

business

03.04.5

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The designations employed in ILO publications, which are in conformity with United Nations practice, and
the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the
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The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with
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Printed in Switzerland
About the Start and Improve Your Business (SIYB) Programme
The Start and Improve Your Business (SIYB) programme is a management-training programme developed
by the International Labour Organization (ILO) with a focus on starting and improving small businesses
as a strategy for creating more and better employment for women and men, particularly in emerging
economies. With an estimated outreach in over 100 countries, it is one of the world’s largest programmes
in this field.
The programme has four inter-related packages - Generate Your Business Idea (GYB), Start Your Business
(SYB), Improve Your Business (IYB) and Expand Your Business (EYB).

The ILO implements the programme using a three-tier structure comprising Master Trainers, Trainers and
the end beneficiaries – potential and existing entrepreneurs. The Master Trainers licensed by the ILO are
responsible for developing the capacity of the Trainers to effectively conduct SIYB training. Thereafter, the
Trainers train entrepreneurs in SIYB packages. The ILO plays a critical role in identifying and disseminating
best practices, carrying out trainings, monitoring activities, performing quality control and providing
technical advice on the implementation of the SIYB programme.

About Improve Your Business (IYB)

Improve Your Business (IYB) is a management training programme for owners and managers of small
enterprises who want to sustain their businesses, increase sales and reduce costs. It addresses the core
question of how to improve the performance of your business.
IYB originates from a programme developed by the Swedish Employer’s Confederation for local small and
medium entrepreneurs. Later, the methods and materials were adapted by the ILO to meet the needs of
people running small businesses in developing countries.
The IYB training programme is supported by a set of six manuals (marketing, costing, buying and stock
control, record keeping, planning for your business, and people and productivity). These manuals can be
taught individually or all combined in a full course. If the full course using all the manuals is delivered, the
duration is approximately seven days. The IYB training uses an active, problem-centred learning approach
to small business management through, for example, short cases and graphic illustrations.
The IYB People and Productivity manual explains how entrepreneurs can increase the business productivity
by following better recruitment procedures, adequately motiving and rewarding their employees, and
maintaining good relations with their suppliers and the community in which they operate.
Authors and acknowledgements

The IYB People and Productivity manual is a result of a collective effort and reflects the experience and
knowledge gathered by implementing the programme for nearly three decades. In particular, the contributions
of SIYB Master Trainers and Trainers who have tested, designed and implemented the programme in different
countries over the years have been invaluable. There are many colleagues from the network of SIYB practitioners,
consulting firms and in the ILO, whose experience, support and constructive suggestions made the publication
of this training manual possible.

This manual is based on the materials originally developed in 2003 by the ILO SIYB Regional Project Office in
Harare, Zimbabwe, where it was written by Ejvind Mogensen and Robert Zegers.

The author team of the 2015 version, which revised the existing text and wrote new chapters to include recent
thinking in enterprise development and related fields comprises Phan Minh Tue, Eva Majurin and Pranati
Mehtha. Stylistic and language editing were carried out by Steve Raymond.
Many thanks are due to SIYB senior Master Trainers Dissou Zomahoun, Gemunu Wijesena, Sibongile Sibanda
and Walter Verhoeve for the review of the draft manuscript and suggestions based on their training experience.
A special thanks to the ILO colleagues- Marek Harsdorff from the Green Jobs Programme of the Enterprises
Department; Jurgen Menze and Esteban Tromel from the Gender, Equality and Diversity Branch; Julia Faldt
from the HIV and AIDS and the World of Work Branch, Kristen Sobeck and Patrick Belser from the Inclusive
Labour Markets, Labour Relations and Working Conditions Branch, for their contribution to the content of
the manual. Short contributions, advice and assistance on integrating linkages to finance in the manual were
received from Cheryl Frankiewicz and Severine Deboos (Technical Expert in the Social Finance Unit of ILO’s
Enterprises Department).
The internal layout and illustrations were carried out by Nguyen Quang Dzung and the cover design was
developed by Maurizio Costanza.

The review efforts and technical contributions of the SIYB Global Coordination Team members who provided
invaluable support to the development and finalization of the manual is greatly appreciated: Merten Sievers
(Specialist – Value Chain Development and Business Development Services), Eva Majurin (SIYB Global
Coordinator) and Thokozile Newman.
Contents
INTRODUCTION i
1. What is this manual about? i
2. Who should read this manual? i
3. Objectives of this manual i
4. How to use this manual? i

PART I - LINKING PEOPLE AND PRODUCTIVITY 01

1. What is productivity? 01
2. Are people important to productivity? 03
3. People and competitiveness 05
Summary 06
Assessment 1 07
Answer to Activities 08

PART II - INFLUENCING PRODUCTIVITY 05

1. Productivity factors 09
2. Productivity indicators 11
3. Monitoring productivity 13
Summary 15
Assessment 2 15
Answer to Activities 16

PART III - PEOPLE, PRODUCTIVITY AND PLANNING 19

1. Setting up an organizational structure 19
2. Human resources management 21
Summary 22
Assessment 3 22
Answer to Activities 23
PART IV - RECRUITING PRODUCTIVE PEOPLE 25
1. How to recruit the right people? 25
1.1 Determine the work to be done 26
1.2 Writing job descriptions 28
1.3 Selecting the right workers 30
1.4 Help the new worker to settle in (induction) 32
2 Avoid discrimination to obtain the best employees 33
3 Beware of exploitative situations 34
Summary 35
Assessment 4 36
Answer to Activities 37

PART V - HOW TO ENCOURAGE STAFF PRODUCTIVITY? 39

1. Wages and financial incentives 40
2 Job security and workplace safety 41
3 Teams and teamwork 42
4 Performance appraisal and rewards 43
5 Training and development 45
Summary 48
Assessment 5 49
Answer to Activities 50

PART VI - WORKPLACE AND PRODUCTIVITY 51

1 The link between workplace and productivity 51
2 Improving the workplace for higher productivity 52
3 Good housekeeping 56
4 Preventing workplace related accidents and illnesses 57
Summary 61
Assessment 6 62
Answer to Activities 63

PART VII - WORKPLACE CULTURE AND PRODUCTIVITY 65

1 Business values 65
2 Code of conduct 66
3 Non-discrimination 67
4 Engaging in dialogue with your employees 68
5 Managing conflict 69
Summary 71
Assessment 7 71
Answer to Activities 72

PART VIII - MANAGING EMPLOYEE COMPLEXITIES 73

1 Do we have a problem? 73
2 Identifying the problem 74
3 Dealing with problems 76
4 Preventative measures 78
Summary 80
Assessment 8 80
Answer to Activities 81

PART IX - BUSINESS RELATIONS AND PRODUCTIVITY 83

1 What about these people? 83
2 Customer relations 84
3 Relations with suppliers 86
4 Your family 88
5 Your neighbours and your community 88
6 Competitors 90
7 Other support institutions 91
Summary 92
Assessment 9 93
Answer to Activities 94

WHAT DID YOU LEARN IN THIS MANUAL? 97

Can You Help? 98
Action Plan 101
Answers 103

Useful business words 109

INTRODUCTION |

1. What is this manual about?

Your business success largely depends on you and on the people working with you. Employees who are skilful
and have a pleasant attitude can contribute to the productivity and create a competitive advantage for your
business. As a business owner, if you show that respect to your employees and treat them well, you will improve
your business performance and, ultimately, your profits. This manual describes how to maximise your profits by
adequately planning and then recruiting, motivating, rewarding and protecting your employees.

2. Who should read this manual?

People and Productivity is one of the manuals in the Improve Your Business (IYB) series. It is useful for
entrepreneurs who are running enterprises and who wish to develop their businesses, increase sales and
reduce costs.

3. Objectives of this manual

When you have completed this manual, you should be able to:
•• Explain the link between people and productivity as well as the link between people and competitiveness
•• Identify the key productivity indicators of your business and the factors that influence them
•• Select the right people for your business
•• Motivate people to become more productive
•• Build a safe and healthy workplace
•• Define a productive workplace culture
•• Identify and solve the problems of troubled employees
•• Maintain good external relations in order to support your business

4. How to use this manual?

In this manual you will find:

•• Stories of businesses: Compare these examples with your own business and use them to improve the
performance and profitability of your business.

INTRODUCTION | i
•• Activities: Practical exercises in the middle of each part that help you to proactively think about the
concepts and how to apply them to your own business.
•• Summary: This is provided at the end of each part. Use it to review the key points.
•• Assessment: This is provided at the end of each part. Answering the questions will help you to assess
how well you understand the content presented in that part.
•• “Can You Help?”: These are exercises at the end of the manual which will give you an opportunity to
apply your new knowledge and skills in specific situations. By doing these exercises, you will find out
how much you have learned from the whole manual.
•• Action Plan: Fill in and use the Action Plan near the end of the manual. This will help you to put your
new knowledge into practice.
•• Answers: Answers to Assessments and “Can You Help?” exercises are given at the end of the manual.
Finish each exercise before you look at the answer.
•• Useful Business Words: You can look up the meaning of business words that you do not understand.
This part is at the end of the manual.
•• Important notes: Each of these notes has important information. Use this information to the best of
your ability. You can find these notes in the middle of different parts of the manual.

Several icons are used within the manual to help guide your study. Examples of the icons and their meanings
are listed below:

When you see this icon, you have activities to do or questions to answer.

When you see this icon, you find an answer for your activities and assessments here.

When you see this icon, it signifies that the information in this part is extremely important.

When you see this icon, you have to complete assessments that help you measure what you have
learned.

When you see this icon, you will know you have just completed one part and the important ideas that
were presented are being summarized here.

When you see this icon, it tells you where to find more information or what to do.

ii | People and Productivity

PART I |

LINKING PEOPLE AND PRODUCTIVITY

Your business success depends on you and on the people working with you. Your employees contribute to
the productivity of your business, so it is important that you understand productivity.

1. What is productivity?

Productivity is the effective use of innovation and resources to increase the value added content of goods and
services.
To improve productivity, the owner of a business can do two things:
•• Increase the output without changing the input (making and selling more)
•• Decrease the input without changing the output (reducing the costs of the resources used in the
business)

Input
Output
People
Land Goods and services sold
Business
to customers
Buildings
Materials
Energy

The output you get from any particular input is the productivity of that input. The productivity of your business,
therefore, indicates the degree to which your resources (input) are put to good use. By increasing your
productivity, you improve your business performance and therefore, increase your profits.

PART I | Linking people and productivity | 01

ACTIVITY 1

Now that you understand how productivity relates to the input and output of your business, how do you
measure productivity? Let’s list all the possible productivity indicators of your business.

...........................................................................................................................................................................................................................

Here are some examples of productivity indicators:

•• The number of garments a worker produces for each hour that he or she receives a salary
•• The weekly sales per square metre of shop space
•• The number of chair legs a machine can turn in a day if working non-stop (the number produced will
depend on the machine as well as on the machine operator)
•• The number of shirts an employee can sew per hour during his or her eight hour shift
•• The total cost of the salaries paid in relation to the total sales of the business

Productivity is also sometimes expressed in a figure that is found by dividing the value of the output by the
value of input.

ACTIVITY 2

Business A B

Output Sales $150,000 $300,000

Cost of goods sold ($100,000) ($210,000)

Input Salaries/wages ($15,000) ($35,000)

Other costs ($10,000) ($20,000)

Profit $25,000 $35,000

1. Which business makes more profit?

02 | People and Productivity

2. Which business has higher employee productivity? Which has higher overall productivity?

3. Can you spot a problem? What would you recommend?

See the answers on page 8.

2. Are people important to productivity?

The following situations illustrate the link between people and productivity and show what may happen if too
little attention is paid to the role of people in your business.

My pay is miserable and I

was never told what to do.
So why I should work hard!
I suppose I should do some
work, but I don’t really care.

Hassan General Store: Hassan does not spend much time on recruiting the right people.
He only makes sure he gets them at the lowest possible wage.

PART I | Linking people and productivity | 03

You are right! Nobody would It is too dangerous to do the job
I’m not thanked appreciate if we do extra well because I cannot see properly.
for cleaning. So work. Just take it easy. The lighting is poor. The owner only
why bother! wants to save electricity.

I wonder when someone

is going to serve.

Sunshine Restaurant: The owner gives the orders and Lungu Metal Workshop: The owner is not interested in
expects her staff to work hard. She pays their salaries health and safety arrangements for employees at his
and believes that is all that is required. workshop. He feels they are too expensive.

Sukuma dirties
I cannot stay very late at work every day. I the roadside. We
need to take care of my child. But the owner don’t want his
business in this I wonder why I don’t have
always takes a lot of clients in the evening. more customers from my
She is only interested in making money. neighbourhood!
own town. All my business
is from out of town.

Hair and Beauty Salon: The owner doesn’t make time to Sukuma Cycle Shop: The owner needs more space for
talk to her staff. She is not interested in their problems. his workshop. He uses the roadside to do some of the
work and clutters it in the process. He is not
concerned with what the people think.

04 | People and Productivity

ACTIVITY 3

From the illustrations on the previous page, write down why you think these businesses are unproductive.

See the answers on page 8.

“ • Note that everything related to productivity has to do with the

people who work in your business. Work can be accomplished
in different ways and some workers may be more productive
than others.
• If your workers are inefficient, your business will suffer. If they
do their work well, your productivity will increase and your

“
business will do well. Who will help them do a better job? You!

3. People and competitiveness

To sell more goods or services, your business must be more competitive than your competitors in the market.
What makes a business competitive? There are many factors contributing to competiveness, such as location,
equipment, materials, distribution, etc. But it is the people working for you who are the decisive factor in
creating a long-term competitive edge for your business. This is because your competitors can replicate the
other factors. For example, the good location of your business will no longer be a competitive advantage if a
competitor finds a location better than yours.

From the illustration on the next page, you can see how people contribute to the competitiveness of a business.
A pool of employees who are skilful and friendly towards customers will differentiate your business from the
others in the market.

PART I | Linking people and productivity | 05

I am not so worried about my
competitors as my employees are
very skilful and hospitable. Most of
my customers are very satisfied with
Are you not worried
that your competitor the services at my beauty salon.
has opened a salon close
to yours?

In this part we have explained that there is not only a link between people and business productivity but also a
link between people and competitiveness. You see how people influence productivity and make your business
more competitive, which results in improved business performance and higher profits.

In the next part, you will learn more about how people can improve productivity and about ways to
systematically introduce and monitor improvements in productivity.

SUMMARY

•• No business can succeed without people who are motivated about their job.
•• Productivity is a measure of the degree to which your resources, including your human resources, are
put to good use.
•• People are important to productivity and to your business profitability. You benefit by treating your
staff with respect and understanding.
•• Employees who are skilful and have a positive attitude are a decisive factor in increasing the
competitiveness of your business.

06 | People and Productivity

ASSESSMENT 1

You have just completed Part I of this manual. Do the exercise below to check your understanding. Finish the
exercises before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. The productivity of a business is found by…

a. dividing the amount of output by the amount of input.

b. dividing the total value of the output by the total value of the input.
c. dividing the total value of the input by the total value of the output.

2. Productivity can be increased by…

a. increasing output and input.

b. decreasing output and increasing input.
c. increasing output and decreasing input.

3. People can influence productivity negatively if…

a. they are given less tasks.

b. they have more holidays.
c. they are not motivated to work well.

PART I | Linking people and productivity | 07

ANSWERS TO ACTIVITIES

Activity 2

1. Business B is more profitable (Sales $300,000 – Input $265,000 = Profit $35,000).

2. Employee productivity= Sales/Salaries or wages

Business A has higher employee productivity:

$150,000/$15,000 = 10 compared to B: $300,000/$35,000 = 8.5

Overall productivity= Sales/Input costs

Business A has a higher overall productivity:

$150,000/$125,000 = 1.2 compared to B: $300,000/$265,000 = 1.13

3. There is a problem with Business B. It achieves higher sales value at a very high cost.

Recommendation: Better training of efficient employees will result in more sales. Pay attention to the
recruitment process so that you can prevent overstaffing and hire efficient employees. Also, ensuring a
safe and healthy workplace will reduce loss of productivity through employee illness or turnover.

Activity 3

These five business owners neglect to pay enough attention to the role that people play in making
their businesses successful. They do not understand how their employees could help them to improve
productivity and increase profits.

•• Hassan General Store did not recruit the right people.

•• The owner of Sunshine Restaurant does not offer encouragement to her staff.
•• Lungu Metal Workshop has an unsafe working environment. This makes the employees unproductive.
•• The owner of Hair and Beauty Salon does not take the time to listen to the problems of her employees.
•• The owner of Sukuma Cycle Shop does not keep his workplace clean and has no regard for his
neighbours. Therefore, he is losing potential customers.

08 | People and Productivity

PART II |

INFLUENCING PRODUCTIVITY
We have learned that productivity can be improved by making and selling more (increasing the output) and/
or by reducing the cost of the resources used in the business (decreasing the input).

As the picture shows, improving productivity

is not so simple. You should think how input
I cannot see what
can be reduced and/or output increased I am saving on electricity
I am doing. It is
without negative consequences. The best so productivity must go up.
dangerous!
results are achieved if both input and output
are considered. You have to choose the right
areas for intervention.
1. You will first have to identify the factors that
influence productivity. See 1. Productivity
factors.
2. You will then have to select the specific
areas in which improvements can be made.
See 2. Productivity indicators.
3. You will use these indicators to measure the
extent to which improvements can actually
be made. See 3. Monitoring productivity.

Is productivity improved?

In the following sections, we will look at each of these three steps and pay special attention to the various ways
in which people can improve productivity.

1. Productivity factors

Productivity factors are issues that positively or negatively affect:

•• The input (materials, wages, electricity, etc.) required to produce a certain amount of output (the quantity
of goods or services produced and sold)
•• The volume of output (the quantity of goods that need to be produced and sold at certain prices in order
to achieve specific sales targets)

PART II | Influencing productivity | 09

Productivity factors may be divided into internal and external:
•• Internal productivity factors are issues that can be influenced by the business owner. These may include
problems with the goods, product quality, price, equipment, material, energy use, skill and motivation of
workers, storage, the organization, etc.
•• External productivity factors are issues that are outside the control of the business. They include access
to infrastructure, the weather, the market situation, taxation, etc. Nothing can be done about these factors
as long as the business keeps operating in its present setting. If they have a serious negative effect, the
business owner may consider relocating or changing the nature of the business.

“ In small businesses, labour is one of the most important factors

influencing productivity. Productivity will increase when employees

“
are skilful, work hard and do their jobs efficiently.

To make a full assessment of the internal productivity factors, it would be best if you and your workers
brainstorm to come up with a list of productivity barriers and constraints. See the following example:
The owner of Sunshine Restaurant knows that her business has problems with productivity. She discusses this
with her staff. Based on both the staff contributions and her own ideas, she prioritized the list of problems as
follows:

1. There are not enough workers to

handle big orders.
2. The new employee does not know
how to use the mixing machine.
3. The cost of the flour is too high.
The employees know that other
restaurants are getting the same flour
for less money.
4. Poor storage of the flour causes it to
get wet and then it has to be thrown
out.
5. The oven is old and does not have the
capacity to hold enough rolls.

10 | People and Productivity

ACTIVITY 4

Which are the most important productivity factors in your business? What are the constraints to your
productivity?

2. Productivity indicators

If you have completed the previous exercise, you should have a better idea of the factors affecting the
productivity in your business. You might also be thinking about what you can do to improve the productivity
of your business. How do you know that implementing the changes would actually improve your business
productivity? Unless you know how to measure productivity, you can only guess.
One way to measure the productivity is to look at the financial results. However, if the results are poor, the
business has already lost money, so this measurement is too late. Therefore, most successful business owners
identify and continuously measure indicators that they know affect the productivity of their businesses without
waiting for the financial results.
A productivity indicator should relate to the business output or input. The following examples are of common
types of businesses and their possible productivity indicators.

To be increased or improved:
•• The value of the monthly sales
•• The number of goods sold per customer
•• The number of new customers
•• The number of customers per employee
•• The time it takes for the delivery of supplies

To be decreased or checked:
•• The cost of the supplies
•• The percentage of spoilage
•• The number of staff absences
•• Shoplifting and theft
Hassan General Store

PART II | Influencing productivity | 11

To be increased:
•• The number of meals served per day
•• The amount of new customers

To be decreased:
•• The time it takes to prepare and serve each meal
•• The amount of food that is wasted
•• The number of employee absences
•• The cost per meal

Sunshine Restaurant

To be increased:
•• The number of products made per month
•• The number of products made per worker
•• The number of orders per month
•• The number of products completed without
reworking

To be decreased:
•• The cost per product
•• The downtime per item of equipment
•• The number of absences per month
•• The amount of raw materials that are scrapped
Lungu Metal Workshop

The major considerations for selecting productivity indicators:

•• They must relate to the type of business you are running and the way in which you manage your
business (as in the examples above).
•• They must react to the changes in the input and the output of your business.
•• They must rely on the use of existing data that is easy to collect, so that you can easily measure
productivity.
Follow these steps to select the appropriate productivity indicators for your business:
•• Step 1: Take a good look at what is happening in your business - Consider your productivity factors,
examine the financial records of the business, talk with your workers and then choose the areas in
which you want to improve your productivity. It should be in areas that will make a difference when
the changes are introduced.

12 | People and Productivity

•• Step 2: Identify the data needed to measure progress towards achieving your productivity goals
- Remember that the data should be either readily available from your existing records or easy to
obtain. Use information from both the past and the present so that you can measure the improvement
of your productivity over a period of time.
•• Step 3: Choose specific productivity indicators – Note that the indicators should be related to the
improvements you are trying to make.

ACTIVITY 5

Below are examples of some common productivity problems (factors) in a small business. Suggest ways in
which these problems could be overcome and what productivity indicators you would use to measure
improvements.

Problems How to improve? Productivity indicators

The time it takes to make an item is too
long.
Customer complains about delivery time
and quality.
The workplace is overcrowded with work
in progress and goods in stock.
Due to poor quality, goods have to be
reworked before delivery.
A lot of waste is generated due to poor
quality materials and errors in processing.
Work often stops because of hazards and
lack of materials.
Workers are idle while waiting for more
work.
Workers are often absent or they leave the
company and take other jobs.
Suppliers deliver late or they deliver the
wrong quantities.

See the answers on page 16.

3. Monitoring productivity

By continuously measuring productivity indicators, you can get important signals about the success of your
business and, therefore, about the profit you make.

PART II | Influencing productivity | 13

ACTIVITY 6

The owner of Sweet Cake has prepared an action plan to improve his business and he selected the following
productivity indicators to check the progress in the bakery:
•• The number of loaves of bread made per bag of flour
•• The amount of time that the ovens are idle
He measured these indicators every week and achieved the following results over a ten week period:

Week 1 2 3 4 5 6 7 8 9 10

The number of loaves per

48 52 60 58 60 62 62 62 64 62
bag of flour
The number of hours the
10 7 5 4 6 3 2 3 1 2
ovens are idle

1. Make graphs to show the changes in productivity.

2. How do you think the improvements were achieved and why?
3. The idle time for the ovens has decreased. What could that mean?

See the answers on page 17.

ACTIVITY 7

Are you continuously monitoring the productivity of your business? Select your productivity indicators and
keep a record of the changes.

We have studied productivity factors and indicators. In the following parts, we will focus more on how
respecting and treating your employees well will contribute towards the improvement of your productivity,
your performance and your profit.

14 | People and Productivity

SUMMARY

•• Productivity may be improved by increasing output and/or decreasing input. The areas of intervention
must be carefully chosen. To do this, you must first identify the factors that influence productivity, and
then select the specific areas in which improvements are planned and determine productivity indicators
to measure the extent to which improvements are actually made.

•• Both internal and external factors affect productivity, but attention to internal productivity factors can
improve productivity much more quickly.

•• Productivity indicators are chosen to measure improvement. They should be appropriate to the business
and focus on problem areas or areas in which improvements should be made. They should be responsive
to changes in input or output and be based on business records that are easy to obtain.

•• Continuous monitoring of productivity indicators will facilitate the constant measurement of

improvement. New and different indicators may be introduced from time to time for other aspects of the
business.

ASSESSMENT 2

You have just completed Part II of this manual. Do the exercise below to check your understanding. Finish the
exercises before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. Internal productivity factors include problems or issues that can be influenced by…

a. the national economy.

b. the competition.
c. the business owner.

2. Productivity indicators are used to….

a. measure changes of productivity.

b. indicate the business growth.
c. check the workers’ output.

PART II | Influencing productivity | 15

3. Monitoring of productivity indicators means…

a. measuring productivity indicators and assessing whether the productivity is increasing or decreasing.
b. undertaking all possible measures to increase the productivity.
c. finding problems or issues that reduce the productivity.

ANSWERS TO ACTIVITIES

Activity 5

Problems How to improve? Productivity indicators

The time it takes to make an item is •• Reduce the time to make that
•• Time from order to delivery
too long. item
•• Reduce the time it takes to
Customer complains about delivery •• Time from order to delivery
make an item and increase the
time and quality. •• The quality of the item
quality
•• The number of work
The workplace is overcrowded with •• Reduce the work in progress stoppages/interruptions
work in progress and goods in stock. and manage the stock better lasting more than one hour
•• The amount of stock
•• Control the quality when work
Due to poor quality, goods have to is in progress •• The number of goods
be reworked before delivery. •• Check the quality before reworked before delivery
delivery
A lot of waste is generated due to •• Check the quality of the
•• The amount of waste as a
poor quality materials and errors in material at the time of purchase
percentage of the sales
processing. •• Streamline processing
•• Waiting time per worker per
•• Ensure high standards of day because of staff illness or
Work often stops because of occupational safety and health injury
hazards and lack of materials. •• Make sure materials are •• Waiting time per worker
available per day because material is
unavailable
Workers are idle while waiting for •• The organization should be •• Waiting time per worker per
more work. made more efficient day
Workers are often absent or they •• Develop a clear employee •• Absences per month per
leave the company and take other policy and review wages and worker
jobs. benefits •• Staff turnover rate
•• Manage suppliers well to make •• The number of delivery delays
Suppliers deliver late or they deliver sure they deliver on time and •• The number of pending orders
the wrong quantities. that they deliver the correct delayed because the wrong
quantities quantities were delivered

16 | People and Productivity

Activity 6

1. Make graphs:

2. The number of loaves per bag of flour has increased, perhaps because there is less loss of flour through
spoilage, theft, or waste. Also, maybe more loaves of smaller sizes are being made. An increase in the
number of customers for Sweet Cake could have also contributed to a greater number of loaves per bag of
flour and also fewer hours that the ovens are idle.

3. A decrease in the idle time for the ovens indicates a higher production and more sales.

PART II | Influencing productivity | 17

18 | People and Productivity
PART III |

PEOPLE, PRODUCTIVITY
AND PLANNING
You need to organize and lead the people properly for your business to be productive.

1. Setting up an organizational structure

Your business is an organization wherein you and your workers are working together to achieve business goals.
If your business is well organized and all the employees know their positions, their responsibilities, their job
descriptions and who manages them, then the organization is properly structured.
An organization structure refers to the way that an organization arranges people and jobs so that its work can
be performed and its goals can be met.

ACTIVITY 8

How many people are working in your business? What are their positions? Do you have a clearly defined
structure of responsibilities, reporting hierarchy and job descriptions?

When your business is very small and communication is frequent between all the employees, a formal structure
may not be necessary. But when the business grows, you should think about delegating various tasks. The most
appropriate organizational structure for a small business is a functional structure, which reflects the following:
•• The differentiation of the division of labour: Who does what?
•• The hierarchy and authority in the organization. Each position in the organization should have a clearly
defined responsibility for output or results. The amount of responsibility should match the amount of
authority one has over the resources necessary to achieve that goal.

PART III | People, productivity and planning | 19

•• The reporting relationship among employees: Every employee should report to one supervisor. Do not
confuse them with a poorly defined hierarchy.
•• Group tasks into functions or positions.

Functional structure of Dunder Cement and Construction Company

When setting up organizational structures, the following must be taken into account:
•• The structure must be simple, flexible and avoid bureaucratic red tape.
•• It should be built around the job descriptions.
•• The employees should participate in the creation and implementation of work plans.
•• The structure must be properly communicated to all employees.
•• The structure must be continuously reviewed to take into account changes in the environment.

ACTIVITY 9

Set up an organizational structure:

Hassan General Store is expanding to become a retail and wholesale company. Assume that there is a Director
(business owner), a Purchasing & Stock Manager, an Accounting and Financial Manager, a Retail Store Manager
and a Wholesale Manager. There are two retail stores and each store is managed by a supervisor. Both the retail
and wholesale outlets have sales staff.

See the answers on page 23.

20 | People and Productivity

ACTIVITY 10

Develop your own organizational structure and base it on the people employed in your business and the tasks
they are currently performing.

2. Human resources management

In small businesses, the owner is usually the one who takes care of human resource management. Human
resource management is different from personnel administration. Personnel administration has much more
to do with the paperwork involved with hiring people, keeping the employee profiles, recording the hours
that the employees worked, overseeing payroll, processing reimbursements, and terminating employment
contracts. Human resource management is much more than personnel administration, as the job is more
focused on building up a committed and highly productive workforce for the business.
Human Resource Management (HRM) is the strategic process of recruiting people, training and coaching
them, and motivating and rewarding them. It must be in line with your business objectives.

“ The slogan “People are a valuable business asset” is the primary

principle of HRM. The growth of your business depends primarily
on the people with whom you work. If you make them happy, they
will be more productive and your business will continue to grow

“
and be profitable.

An effective HRM should ensure that:

•• The business hires the right people for the right job: Part IV of the manual explains how to recruit
the right people.
•• The people are motivated to be highly productive: Part V will offer techniques for motivating people.

PART III | People, productivity and planning | 21

•• High productivity is maintained by creating a healthy and safe environment at the workplace: In
Part VI you will learn about occupational health and safety.
•• An appropriate workplace culture is created: All of these issues are discussed in Part VII.
•• Problems relating to the employees are addressed quickly and effectively: Part VIII will discuss
how to identify employee problems immediately and how to solve them effectively.

SUMMARY

In this part, you have learned that:

•• An organizational structure refers to the way that an organization arranges people and jobs so that its
work can be performed and its goals can be met. When your business is very small and communication
is frequent between all the employees, a formal structure may not be necessary. However, when the
business grows, you should think about delegating various tasks and making sure that your employees
are clear about their tasks, responsibility and reporting authority in the organization.
•• Human Resource Management is different from personnel management. Human resource
management is a strategic process of recruiting people, training and coaching them, and motivating
and rewarding them.

ASSESSMENT 3

You have just completed Part III of this manual. Do the exercise below to check your understanding. Finish the
exercise before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. A good organizational structure should very clearly define…

a. who the business owner is.

b. how people and their jobs are arranged in a business.
c. the skill requirements for every position.

2. Human resource management aims to…

a. build up a committed and highly productive workforce for your business.

b. record the working hours correctly.
c. supervise people to make sure that they are working effectively.

22 | People and Productivity

ANSWERS TO ACTIVITIES

Activity 9

Organizational structure of Hassan General Store:

PART III | People, productivity and planning | 23

24 | People and Productivity
PART IV |

RECRUITING PRODUCTIVE PEOPLE

The first step in managing productivity through people is recruitment. It is the process of selecting the most
suitable applicants to employ in your business.

Do you want to
serve me? Or Come here and serve
I will go to the Mr. Moyo, as I don’t No, you do it.
opposite shop. have the time. I am on a break.

I can hardly get

to the counter
through all this
rubbish. Don’t
you ever clean
this place!

1. How to recruit the right people?

Your business must have a clear recruitment policy that is based on the needs of the business. The recruitment
policy should very clearly state what skills are necessary for your business, the type of people you would like
to recruit, the number of people that you will recruit and how you will find and hire them. All the people who
are involved in the recruitment process in your business must consistently follow this policy. It must also be
applied to all applicants, including your family members and relatives.
When recruiting people you have to:
•• Determine the work that needs to be done in your business
•• Write job descriptions that specify who is to do what

PART IV | Recruiting productive people | 25

•• Attract suitable applicants and then interview and select the right workers
•• Finally, help the new worker to settle in and to understand your business (induction)

1.1 Determine the work to be done

Your workforce is not only a significant input, but it also comes at a significant cost. Therefore, it is important to
know what work is to be done and then to select and manage your workers so that they do the best possible job.
Follow these steps to determine the work that needs to be done.
Step 1: List the kind of work to be done and the skills and attitude needed - Create a role profile/job
description that will define the overall objective of a position, its reporting relationships and job requirements.
Job requirements include the technical competencies needed for the role, behavioural and attitudinal
requirements, qualifications needed, experience level required, specific demands from the candidate (example:
need to improve sales) and special requirements needed to fulfil the job (example: travelling).
A role profile produces the job criteria against which candidates will be selected and assessed at the interview.
If you have already employed workers, you can observe and evaluate the tasks that they perform based on the
role profile.
Remember, that when setting the role profile, you should act as an equal opportunity employer. You should
not discriminate on the grounds of disability, real or perceived HIV status, or gender. As for all other candidates,
you should focus on the skills and abilities of the applicant.
Step 2: Estimate the amount of work involved - See how much time is spent on each task, keeping in mind
the need for breaks. For example, what is required to provide proper service levels? Are there any slow or peak
workload periods? This will help you to estimate the number of workers you need and the number of hours
they need to work.
Step 3: Determine who does what job - When you have identified the amount of work to be done, think
about the different ways in which you can get the job done. Some possibilities include:
•• Expand your own skills and do some of the work yourself. This would save you money, but may require
that you get more training and experience. For larger businesses that require the owners or managers
to spend more of their time overseeing the operation, this is not the best option. They should think
about delegating tasks and responsibilities to others.
•• Subcontract tasks to other businesses or contract experienced part-time workers. This would help
you to get qualified workers at lower costs and give you enough time to concentrate on supervising
business operations.
•• Train existing staff.
•• Employ full-time workers who have the necessary skills.

“ Employing staff is a serious matter. Being proficient in this job is

part of being a good manager. You can get help, but the

“
responsibility is yours.

26 | People and Productivity

ACTIVITY 11

Hassan General Store is open about 40 hours per week. The owner acts as the supervisor of the store and has
two shop assistants to help him run the business. He has finally understood that he must have the right people
with the appropriate skills and a positive attitude working with him. Therefore, he lists the most important
tasks to be done. Now, he needs to identify who does which job and he wonders whether he should hire
additional staff:

Tasks Hours per week

Purchasing stock 20

Serving customers in the store 70

Keeping records and paying bills 10

Packing shelves 10

Cleaning up 20

Delivering goods 20

Total hours per week 150

1. How many workers are needed?

2. Who should do which job?

3. Can Hassan subcontract any work instead of hiring an employee? Why?

See the answers on page 37.

PART IV | Recruiting productive people | 27

ACTIVITY 12

•• What are the tasks to be carried out in your business and how many hours per day or week are required to
complete the tasks?

•• What skills and attitudes are needed by the workers?

•• Are you employing the correct number of workers?
•• Are there other ways you could have the work done?
...........................................................................................................................................................................................................................

1.2 Writing job descriptions

A job description is like a work programme for one person. Job descriptions help you decide who should do
what job and the skills and abilities needed to perform the job. Job descriptions also help workers understand
what is expected from them. A job description should generally contain:

JOB DESCRIPTION
Name of the business: Enables the applicant to know which company he/she is applying
to. The applicant can then find out about the company background,
location and reputation.
Job title: Gives a clear indication of the position of a person in the business
and the main function of the job - e.g.: Marketing Manager.
Reports to: Identifies the reporting relationship between the job holder and
the manager or supervisor to whom the job holder is directly
responsible.
Supervises the following: Identifies which subordinates will report to the job holder.
Main objectives of the position: A concise summary of the job to be performed, its link to other
jobs and its overall contribution to the objectives of the business.
Principal responsibilities and A description of the major duties and responsibilities of the job, in
main tasks: the order of importance, with the standards of performance that
are expected of the job holder.
Job requirements: Summarises the requirements of applicants for the position,
including past experience, education, training and other
qualifications needed to do the job.

28 | People and Productivity

Expected start date, the end Indicates when the applicant will be required to commence duties,
date if applicable and the hours the duration of the contract for the vacant position and whether
of work: the position is full-time or part-time.
Salary: Indicates the remuneration provided for the specific job. It also
includes any benefits that will be given to the applicant.
How to apply: Indicates who the applicant should contact and what details need
to be submitted for the application.

Here is a job description of a Shop Supervisor of a general store.

Name of the business: Express General Store

Job title: Shop Supervisor
Reports to: Owner of the shop
Supervises the
Shop Assistants
following:
Main objectives of the The Shop Supervisor is responsible for ordering supplies, controlling and
position: storing stock, managing the display the goods and service to customers.
Principal 1. Every week, prepare a list of goods to be ordered from the main
responsibilities and supplier. Discuss the list with the owner to get approval.
main tasks: 2. Place the order either every day or weekly, depending on the item.
3. Check the incoming stock against the orders and inform the owner of
any discrepancies.
4. Ensure that all stock is properly displayed on the shelves for customers
to see.
5. Ensure that backup supplies of stock are properly stored in the
storeroom and are easily retrievable.
6. Ensure that customers are treated courteously and that any complaints
are immediately acted upon.
7. Ensure that telephone orders received from customers are properly
prepared and delivered on time.
8. Direct and assist other staff in carrying out their duties.
9. Perform any other duties that may be necessary or are assigned by
the owner of the shop.
Job requirements : Must have completed a secondary education and must have knowledge
about retailing or other relevant trade. Also must have at least four years
of experience in retail (preferably in convenience stores or supermarkets.
In addition, a successful applicant has a friendly and helpful attitude and
exhibits a willingness to help fellow workers when needed.
Expected start date, the This job is full time. The contract will be for one year and is renewable,
end date if applicable depending on the performance. The candidate that has been chosen will
and the hours of work: start the job on June 1st.
Hours of work: 40 hours per week; from 8:00 am to 5:00 pm (includes one
hour for lunch) from Monday to Friday.

PART IV | Recruiting productive people | 29

Salary and benefits: Wage: $2000/month.
Sick leave and holidays: Ten days of paid sick leave and twenty days of
holidays.
Benefits: 7% of the wage is paid to the National Social Security and Health
Benefit program.
How to apply: Send CV to email address: [email protected]

ACTIVITY 13
Hassan has come to the conclusion that additional staff is needed in order to get everything done correctly and
on time. He has decided to employ a person whose responsibility will be to keep the shop clean and orderly,
deliver goods and serve customers whenever the shop assistants need help. Hassan will not be subcontracting
these tasks.

Create a job description for this position.

See the answers on page 37.

ACTIVITY 14
Do you write job descriptions in your business? If so, what do the job descriptions include? Do workers
understand their job descriptions?

1.3 Selecting the right workers

Once you have determined the work that has to be done and you have prepared the job descriptions, you can
then hire the employees. The following steps will enable you to select the right people for the jobs. Even when
your business employs relatives, you should follow these steps to make sure you choose employees in the right
way and select the right ones.

Step 1: Advertise the job and identify possible candidates - You can find suitable candidates by advertising
in newspapers or working with local employment services and/or vocational training centres. Alternatively,

30 | People and Productivity

you might ask colleagues in the industry or friends and family to help find suitable candidates. If formally
advertised, a summary of the job description should be given with the proposed salary, start date, hours of
work per week, contact details for applying for the job and if possible, the documents that should be submitted
for the application. Before setting a date and time for the interview with a candidate, you should check the
candidate’s references and past employment.

Step 2: Interview and test the candidate - The shortlisted candidates should then be called for an interview
or tests if needed. Some applicants find the interview procedure overwhelming, so it is important that you
create a relaxed atmosphere. The interview should be used to:

• Tell the applicant about your business and thoroughly describe the job that has to be done and the
standards of performance that are expected

• Confirm the information on the resume concerning the applicant’s qualifications, knowledge, skills
and experience

• Explore any additional and useful talents that the applicant may have
• Test the skills and knowledge of the applicant by asking how he or she might solve a problem or
perform a certain duty

• Give the applicant the opportunity to ask questions and present his or her views on matters relevant
to the business and the vacant post

• From your general impression of the personality of the applicant, decide if the applicant and you could
work well together

Step 3: Choose the right person - Do not select the person for reasons not linked to the job itself. For example,
is it a good idea to employ family members or friends? It can be a good idea, but it can also create special
problems. Family members or friends sometimes expect special treatment, which can lead to problems with
other workers. So think clearly and do not hire people just because they are friends or family. Additionally,
when hiring, do not assume that women, people with disabilities or HIV status are unemployable. You should
treat them in the same way as you would treat any other applicant. Focus on whether the applicant has the
right skills and attitude for the job. The future of the business depends on having the right people in the right
job.

Step 4: Make an agreement - The agreement should contain the job description and specify the conditions,
including wages, working hours, duration of the contract, sick leave and holidays, social security and health
benefits, relevant company rules, performance reviews and any incentives available. Both the new worker
and the business owner should sign the agreement. If your business employs many workers, you may have a
printed standard agreement, as most conditions of work would be the same for everyone.

ACTIVITY 15

The owner of Hassan General Store is going to employ a new worker for cleaning and organizing the store,
delivering goods and helping to serve customers when shop assistants require help.

PART IV | Recruiting productive people | 31

In the previous activity, you created a job description for this position. Hassan is now ready to interview the
applicants.
1. What questions should he ask?
2. How should he test the applicants?
3. Draft an employment agreement specifying the above mentioned conditions.

See the answers on page 38.

“ Before employing people you should understand the laws and

“
rules of employment in the country.

1.4 Help the new worker to settle in (induction)

On the first day of the job you should help the new worker to become familiar with the working environment.
This process is called induction.

ACTIVITY 16
What should be included in an induction programme?

A good induction programme should cover the following:

•• The vision for the business and the company •• Phone numbers and addresses of the key
values people
•• An organization chart with a description of •• Grievance procedures
the organizational structure
•• Disciplinary procedures
•• Policies, rules and procedures •• Promotion policy
•• Payroll and administration hierarchy •• Training and development issues
•• Work schedule, overtime policy and work •• Confidentiality and conflict of interest
breaks

32 | People and Productivity

•• Annual leave, statutory holidays, special •• Occupation safety and health policy
holidays, sick leave, maternity leave, etc.
•• Discrimination and harassment policy
•• Information about performance reviews and •• Expenses that may be claimed
the timing of such reviews

ACTIVITY 17

How do you know that you have the right people in your organization? Did you choose the right person for the
right reasons? Did you make a contract? How well do the employees know the laws and rules affecting their
employment? Have you helped them to settle in and to understand your business?

2. Avoid discrimination to obtain the best employees

Discrimination occurs in recruitment when a distinction, exclusion or preference is made against an applicant
solely on the basis of characteristics that are not related to the person’s competencies or the inherent
requirements of the job. Discrimination while hiring on the basis of race/colour, sex, religion, political opinion,
nationality, HIV/AIDS status, disability, workers with family responsibilities, etc. prevents equality of opportunity
in seeking employment.
Following are some of the most prominent forms of discrimination in recruitment:
Gender discrimination is when one applicant is treated differently than another based solely on biological
characteristics and functions that distinguish men and women; and on the basis of social differences between
men and women rather than their abilities and the job requirements. Discrimination based on sex also includes
sexual harassment, insults or inappropriate remarks, paternalistic attitudes, unwelcome invitations or requests
and any unnecessary physical contact during the interview.
Be open to applications from both sexes to all jobs in your enterprise; don’t think some jobs are better suited
for men and others for women. The result would be that you lose the ability to find the best person for the job.
Discrimination against persons living with HIV/AIDS is also found to be common while making recruitment
decisions. There should be no discrimination or stigmatization of workers on the basis of real or perceived HIV/
AIDS status. HIV/AIDS screening should not be required of either job applicants or employees and HIV infection

PART IV | Recruiting productive people | 33

should not be a cause for termination of employment. Persons with HIV-related illnesses should be allowed to
work for as long as they are medically fit.
Discrimination against persons with disabilities is a common problem. As a result, disabled people are
disproportionately poor and underemployed. Enterprises should not discriminate against people with
disabilities while recruiting and should take positive steps to accommodate particular workplace needs that
workers with disabilities may have.
There are two types of discrimination: direct and indirect discrimination. Direct discrimination is when the
employer passes over a qualified applicant and recruits another applicant just because he or she prefers to work
with persons of one sex, of a specific ethnic origin or religion, or other similar factors. Indirect discrimination
is more common. It occurs when a recruitment practice appears neutral, but leads to disadvantages that are
primarily suffered by people of one sex, race, health status, or other such characteristics. For example, an
employer may set minimum height and weight requirements that don’t relate to the job performance but set
the bar too high for female applicants.

“ Discrimination does not just harm individuals and society, but also
hurts your business: provide equal opportunities for all to apply in

“
order to obtain a talented and skilled workforce.

To be fair and in order to obtain the best talent in the labour market, you should give all applicants regardless
of sex, race, disability, social origin, etc., an equal opportunity to fill your vacant position.

Your work policies should also allow and encourage all applicants to apply for a job. For instance, providing
female employees with a paid maternity leave, enabling them to travel with their babies, creating an environment
that is free from sexual harassment, providing equal opportunities for women and men for training and career
development and equal remuneration for work of equal value will help you to attract qualified women whose
talents and contributions will be beneficial for your business.

3. Beware of exploitative situations

Child labour is defined as work that deprives children of their childhood, their potential and their dignity. It is
harmful to their physical and mental development.

It refers to work that:

•• Is mentally, physically, socially or morally dangerous and harmful for children
•• Interferes with their education by depriving them of the opportunity to attend school, making them

34 | People and Productivity

leave school prematurely, or requiring them to attempt to combine school attendance with excessively
long working hours
Not all work done by persons under the age of 18 years of age is classified as child labour. Children engaged
in assisting in the family business or earning pocket money outside school hours and during school holidays
in conformity with national legislation on the types of work allowed for different age brackets are regarded as
positive experiences. These types of jobs can contribute positively to the individual’s development and provide
skills and experience that help to prepare that person to be a productive member of society, while at the same
time providing businesses access to valuable talent.
If you recruit people less than 18 years of age, you should make sure that:
•• They have reached the minimum age as specified in the law for that type of work.
•• The job is not dangerous, hazardous, or difficult.
•• The job does not prevent them from attending school.
•• The working conditions are not harmful to their physical and mental health.
•• The wages are not lower than those of other workers doing the same job.
Forced labour is any work or service that people are forced to do against their will, under the threat of some
form of penalty. Freedom from forced labour is a basic human and workers’ right that needs to be respected.
You should also keep in mind that only people who willingly come to work and are not being forced to do so
will be productive employees. In addition to refraining from forcing someone to work, you should make sure
you do not indirectly contribute to forced labour by recruiting someone whose application may not be inspired
by free will but instead is linked to debt bondage, labour trafficking or similar abusive practices.

SUMMARY

•• The success of your business and the amount of profit it makes depends on the productivity of your
workers.
•• Wages are one of the greatest costs of your business. Make sure you know what work needs to be done,
what skills are required, how much time is to be spent doing the work and who will do it.
•• Make a job description for every employee. It should contain the name of the business, the job title, the
person to whom the employee is responsible, people that the employee may supervise, an outline of the
job describing the specific duties of the new employee, the qualifications required, expected start date,
end date if applicable, hours of work, salary and benefits and how to apply for the job.
•• Select the right people by taking the following steps: Advertise the job, interview qualified applicants,
choose the right person and make an agreement.
•• Complete an induction programme to ensure that the new worker quickly settles in and understands
your business.
•• Discrimination is not only illegal, a breach of an individual’s human rights, and costly for the community,

PART IV | Recruiting productive people | 35

but also has a negative impact on business performance, as it means the business may not be able to
obtain the best talent in the market.
•• Child labour deprives children of their childhood, their potential and their dignity. When recruiting persons
under 18 years of age, make sure you are providing decent work in conformity with national legislation.
This means you will benefit from the talent and contributions of these youth who will be gaining valuable
work experience in safe conditions.
•• Do not contribute to forced labour or exploitative labour practices by recruiting persons who you suspect
may not be applying for the job out of free will but because they are victims of trafficking or other abusive
and coercive practices.

ASSESSMENT 4

You have just completed Part IV of this manual. Do the exercise below to check your understanding. Finish the
exercise before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. A job description should contain…

a. the name, address and telephone number of the employee.

b. the title and other details of the job.
c. the title of the job and the name of the employee.

2. To select the right person, you should make sure that…

a. this person must be qualified to do the job.

b. this person must have a good relationship with you.
c. this person must have a lot of work experience.

3. You should conduct an induction programme to help the new person…

a. learn who you are.

b. learn how to treat the other employees.
c. understand your business and settle in quickly.

4. As a specific form of discrimination, sex discrimination is…

a. treating male and female candidates differently.

b. not giving favours to female candidates.
c. asking male and female employees to do the same jobs.

36 | People and Productivity

5. When you hire people less than 18 years of age, you should give them jobs…

a. which can interfere with their schooling.

b. which are under the minimum age limit to do the job for working.
c. which are not harmful to their physical and mental health

ANSWERS TO ACTIVITIES

Activity 11

1. The total number of hours required to do the work at the store is 150 per week. Each person works about
40 hours per week. Therefore four people are needed to execute all the tasks efficiently.
2. Supervisor/owner: Purchasing stock, keeping records and paying bills.
First & second staff assistant: Serving the customers in the store and packing shelves.
Messenger: A fourth staff can be hired for cleaning up and delivering goods.
3. Hassan can subcontract the work of cleaning the store and delivering goods as this service is a generalized
skill, so someone who is not directly connected to his store can also do the jobs. Also, subcontracting
might be a cheaper and faster option than hiring an employee.

Activity 13
Job description for Messenger:

Name of the business: Hassan General Store

Job title: Messenger
Reports to: Shop Supervisor
Supervises the following: None
Main objectives of the position: The Messenger is responsible for keeping the shop clean and
orderly, delivering goods, and serving customers whenever the shop
assistants need help and the messenger is not delivering goods.
Principal responsibilities and 1. Every morning, clean the shop floor and shelves
main tasks: 2. Deliver goods to the customers that require delivery
3. Serve customers when the shop assistants need help
4. Perform any other duty that may be necessary or is assigned by
the shop supervisor/owner
Job requirements: Must have completed a secondary education and must have at least
one year of experience in retail, preferably in convenience stores or
supermarkets.
In addition, a successful applicant should have a friendly and helpful
attitude and should exhibit the willingness to help fellow workers
when needed.

PART IV | Recruiting productive people | 37

Expected start date, the end This job is full time. The contract will be for one year and is renewable,
date if applicable and the hours depending upon the performance. The candidate that has been
of work: chosen will start the job on Sep 1st.
Hours of work: 40 hours per week; from 8:00 am to 5:00 pm (includes
one hour for lunch) from Monday to Friday.
Salary and benefits: Competitive monthly salary and benefits will be provided.
How to apply: To make an appointment, call Mr Hassan 056 6823889

Activity 15
1. What system should be used for cleaning? How should the deliveries be checked to make sure that they
are correct?
2. Test by conducting a trail day and observe how applicants clean the store, and by checking how well
applicants know the streets in the town, etc.
3. Employment agreement:

EMPLOYMENT AGREEMENT

Name of employer: Hassan General Store

Title: Messenger
Employment term: One year (renewable depending upon the performance)
Wage: $550/month. Paid in cash on the last day of the month.
Hours of work: 40 hours per week from 8:00 am to 5:00 pm (includes one hour for lunch) from Monday
to Friday.
Sick leave and holiday: Six days of paid sick leave and ten days of holidays.
Benefits: 7% of the wage is paid to the National Social Security and Health Benefit program.
Performance review: A written performance review will be made every six months. A bonus will also
be awarded for good performance.

38 | People and Productivity

PART V |

HOW TO ENCOURAGE
STAFF PRODUCTIVITY
In addition to possessing adequate knowledge to do a job, workers should also be motivated to work. This
will encourage staff productivity. There are many ways to motivate people. There is negative motivation; such
as the fear of losing a job or risking criticism from the boss. There is also positive motivation; such as praise,
financial incentives, additional training and professional development. Positive motivation is more effective in
improving performance and increasing productivity.

ACTIVITY 18

What are the ways in which you can keep your staff motivated?

There are many theories about what motivates people, but one that is widely used is Maslow’s Hierarchy of Needs.

Needs level 5:
People want to develop themselves, to improve their
abilities, to learn new skills and to grow in their jobs. See 5.
Training and development on page 45.
Needs level 4:
People want to be valued for what they do; they want to be
given responsibility for their work and be rewarded for what
they do well. See 4. Performance appraisal and rewards
on page 43.
Needs level 3:
People want to feel part of a group; to belong and contribute
positively to their environment. See 3. Teams and teamwork
on page 42.

PART V | How to encourage staff productivity | 39

Needs level 2:
People need to feel safe and secure in their work. See 2. Job security and workplace safety on page 41.
Needs level 1:
People need to satisfy their basic needs for food, clothing and housing and they need adequate finances for
their family and their children’s education. See 1. Wages and financial incentives on page 40.
You see that there are different levels of needs. The theory is that first the lower level needs must be satisfied,
or at least partially satisfied. After that, the higher level needs can be addressed. This means that, unless people
feel that their salaries and working conditions are satisfactory, and until they feel that they have some sort of
job security, they are unlikely to be motivated to improve their performance for the benefit of your business.

1. Wages and financial incentives

The first step in motivating your employees is to ensure them that they will receive a regular and fair wage. The
wage must be sufficient for meeting the needs of the employees and their families and has to be in conformity
with minimum wage legislation. Maternity leave with pay, sick leave with pay and holidays with pay should
also be provided in accordance with the law. In addition, workers could be offered other monetary incentives,
such as bonuses (for individual as well as group performance), life insurance or matching contributions to a
savings account for their children’s education.
When deciding on remuneration, make sure you evaluate each job objectively and that you provide equal
remuneration for work of equal value. This means you should pay staff the same when they perform the same
work, but also work that may be different, but of equal value. For instance, the job of an account manager may
be different than that of a marketing manager, but they may be similar or the same in terms of expertise levels,
effort, responsibility and working conditions. The evaluation of such objective criteria should be a primary
consideration when deciding on remuneration, rather than stereotypical assumptions about the job or job
holder.

“ You should pay employees a wage that ensures they can meet
their needs, which should under no circumstances be less than
the minimum wage regulated by the government. You should
also pay wages to workers when they take maternity leave,
and make sure you provide equal pay for work of equal value

“
to your employees.

40 | People and Productivity

ACTIVITY 19

Suggest possible monetary incentives other than salary for a shop assistant, a hairdresser and a machine
operator.

See the answers on page 50.

2. Job security and workplace safety

• Job security: If a worker has a well-paid job with good working conditions, he or she would want
the situation to continue and would want to keep the job. The business owner will gain by having
employees work for a longer time in the business so that the business does not have to waste time in
recruiting and training new people time and again.
• Health and safety: A worker who is afraid of being injured will be distracted at work and cannot be
expected to do the job well. Similarly, if the worker is exposed to hazardous materials that affect his or
her health negatively, the productivity of the worker will diminish. The business owner should ensure
that the workplace has health and safety provisions in place and that the workers are taught how to
access it. This will have a positive impact on productivity.

ACTIVITY 20

What can you do to improve job security and workplace safety in your business?

Part VI will explain the link between a safe workplace and productivity
in more detail, as well as how to create a safe workplace.

PART V | How to encourage staff productivity | 41

3. Teams and teamwork

Teamwork increases productivity as it improves coordination and interaction between workers, produces
better ideas and improves the involvement of individuals in the success of the whole process.
See the following example:

The owner told me

the whole thing would It is nice to be appreciated
Perhaps we
break down if I didn’t and I don’t mind helping my
will have a
do the delivery on time. colleagues.
get together
I must be important! after work.
I really like working
I look forward
with my colleagues.
to the company
outing on Sunday.

Nice to be in
charge of this
team. They all
do their best.

“ All team members must be treated equally and fairly, irrespective

of age, gender, disability and ethnic background. The basics
of equality of treatment are equal pay for work of equal value,

“
equality of opportunity and equal conditions.

42 | People and Productivity

ACTIVITY 21

How can you facilitate the use of teams and teamwork to help improve your business productivity?

4. Performance appraisal and rewards

The fourth step on the ladder of motivational needs says that people want to be valued for what they do; they
want to be given responsibility for their work and be rewarded for what they do well. The worker is already
motivated by having a well-paid, secure job and has the feeling that he or she is part of a team. The employees
would be further motivated by being appreciated and rewarded for the work done by them.

ACTIVITY 22

How do you show appreciation and reward your workers so that they improve their performance?

To encourage workers to perform better, you should:

• Make clear the standards of performance that are expected of each worker
• Continuously assess the performance of the workers
• Give them feedback on both the positive and the negative aspects of their performance
• Encourage workers by rewarding their good performance
• Let workers encourage and appraise each other

PART V | How to encourage staff productivity | 43

“ If a worker does something particularly well, you must show
your appreciation as soon as possible. It motivates him or her to

“
continue in this way.

You need to take time to listen and to give feedback. If you are busy, tell the employee that you would like
to talk later and immediately make an appointment for the discussion. Unresolved work issues or personal
problems keep people distracted from their work, which slows productivity.

How to give daily feedback?

• Do it soon after the activity if possible, whether it is praise or admonition
• Think before you speak
• Be specific. For example, say things like: ‘I didn’t think it was proper to interrupt while the person was
speaking.’
• Be direct and try to be as helpful as possible, without being sarcastic or negative
• Focus on important issues
• Choose the right time, the right place and the right words
• Remain calm

Feedback about poor performance should be given in a constructive way and should focus on the behaviour,
not on the person. The discussion should be about finding the reason for the poor performance and about
finding ways to improve it. This could include training, different tasks, new tools or equipment, or even a short
leave from work to recover from an illness. Continuous poor performance, even after various solutions have
been offered, forms the basis of termination of the contract of the worker.
In addition to the daily feedback, a performance review meeting should be held once or twice a year. In
this meeting, you would assess the performance of each employee. You should ask the employees to answer
questions about the goals that were set in the previous meeting, such as:
•• Was it a realistic goal? If not, what target would have been better?
•• On a scale of one to ten, how well do you believe that you have achieved the goal?
•• How do you know that you have reached this level of achievement?
•• What have you done to reach the goal?
Then the future goals should be discussed and agreed upon.
As the manager of your business, you should ask your workers to give you feedback on your own performance.
Workers can help you to improve productivity by identifying both the negative and the positive aspects of the
actions you take and the decisions you make. Workers should be able to give honest feedback to owners or

44 | People and Productivity

managers without fear of punishment. Also, use the performance review meeting to discuss bonuses and/or
possible promotions for your best employees.

ACTIVITY 23

At Sunshine Restaurant, the workforce is made up of cooks, waiters and cleaners. Their job descriptions consist
of buying and storing stock, cooking, serving and cleaning.
How would you assess the performance of the cook, the waiter and the cleaner? What rewards would you give
for exemplary performance?

See the answers on page 50.

ACTIVITY 24

How do you assess and control worker performance in your business? What rewards do you give for good
performance?

5. Training and development

Training
You have selected your workers carefully, so they should have the skills needed to do their jobs. However, your
business might be a bit different than the other businesses in which they worked, so on the job training will
enable the workers to perform to the best of their abilities. Additional training may be needed as your business
develops or if there are new trends in the market and new skills are required.

PART V | How to encourage staff productivity | 45

You should not put too
much jam and cream on
top of cakes.

The Sweet Cake owner is aware that his new employee needs to be taught what to do
in order to maintain the standard of quality that he has set.

In small businesses, employees learn from experienced co-workers or supervisors while they are on the job.
Therefore, most of the training will be done on the job and by coaching.
Coaching will provide workers with the skills they need to perform their jobs better. Normally the business
owner acts as a coach, but you can also assign workers who have experience and skills to coach new workers.
To provide an effective coaching session, you should:
•• Identify the new skills that the workers need by comparing their current performance with the
requirements of the job.
•• Involve the workers in the planning of the coaching sessions to help you decide what skills they need
to be taught and when and where the sessions will take place.
•• Explain very clearly what skills are needed and what you expect to achieve.
•• Demonstrate the skills so that the workers can observe them.
•• Make it a requirement for the workers to practice the new skills.
•• Observe their performance and give them feedback so that they can improve their skills.

46 | People and Productivity

ACTIVITY 25

There is a new trend for fruit icing in the bakery business but none of the employees at Sweet Cake bakery know
how to make fruit icing. How does the Sweet Cake owner provide this skill to the employees?

See the answers on page 50.

ACTIVITY 26

Can you identify the workers that need training? How do you provide on the job training for them?

Employee development
The top step on the motivational ladder concerns the need for people to develop themselves, to improve their
abilities, to learn new skills and to grow in their jobs. If the need is met, your workers will be happier and more
motivated to contribute to making your business more productive.
How do you respond in the right way? Some examples:
•• Have workers perform a different job for a short period of time in order to add to their skills and
qualifications and to create a pool of workers who are able to perform different tasks when you need
more help in different departments.
•• Promote workers from within your business rather than bringing in people from the outside. This
should be a stated policy. When employees know that performing well may result in promotions, they
are motivated to do the best job possible. Talk to them about promotions and career possibilities
during performance reviews.

PART V | How to encourage staff productivity | 47

ACTIVITY 27

What training and other development incentives do you offer to workers employed in your business?

In this part, you have learned several ways to encourage your employees to be more productive and
consequently be happier in their work. Remember that all of this will help you to improve productivity and
earn higher profits.

SUMMARY

•• Staff productivity is higher if people are motivated by having their needs fulfilled. The first need is to earn
enough money to provide for themselves and their family, the second is to have job security and workplace
safety, the third is to feel part of a group and work together, the fourth is to be given responsibility and
to be rewarded for good work and the fifth is to be able to develop themselves and grow in their jobs. By
considering these needs, you can motivate your workers and make them be more productive.
•• Pay decent salaries/wages which satisfy the basic needs of your workers, ensuring that these payments
are in line with national legislation on wages, maternity protection, and other relevant legal provisions.
Consider offering other financial incentives to motivate staff.
•• Make your workers feel secure and safe in their job. A safe and secure working environment makes
people more motivated and more productive.
•• Encourage teamwork and give your workers the opportunity to be part of the team that makes up your
business.
•• Provide daily feedback and periodically appraise the performance of your workers in a performance
review meeting. Demonstrate the linkage between performance and reward.
•• On the job training is needed to ensure that your workers perform to the best of their abilities. Additional
training may be needed as your business develops and new skills are required.
•• When your workers don’t know how to do the job correctly, coaching is needed. The purpose of coaching
is to provide workers with the skills needed to do a better job.
•• Employee development is crucial to productivity gains and includes:
–– Having workers perform a different job for a short period of time in order to add to their skills and
qualifications
–– Promoting workers from within your business, rather than bringing in people from the outside

48 | People and Productivity

ASSESSMENT 5

You have just completed Part V of this manual. Do the exercise below to check your understanding. Finish the
exercise before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. Step one on the ladder of motivational needs refers to…

a. the need to feel part of a team.

b. the need for being part of a group and contributing to the business.
c. the need for a salary that is sufficient to ensure a decent standard of living.

2. Job security means…

a. a job which the employee can keep for a long period of time.
b. a full-time job.
c. a well-paid and relaxed job.

3. People like to work in a team, because…

a. they can share job responsibilities.

b. they can become more productive.
c. they feel that they are part of a group.

4. When you give feedback to people about their poor performance, you should show them…

a. how bad they are.

b. which behaviour is inappropriate.
c. how much better the others are.

5. Training and development helps people…

a. to develop competencies and improve performance.

b. to become experts at their jobs.
c. to only learn new knowledge and skills.

PART V | How to encourage staff productivity | 49

ANSWERS TO ACTIVITIES

Activity 19

Shop assistant:
•• Give a bonus based on the total sales per week, month or year
Hairdresser:
•• Give a bonus based on the total number of customers per week, month or year
•• Plus give an extra incentive based on those customers who specifically ask for him or her to serve them
Machine operator:
•• Give a bonus based on the units produced

Activity 23

Cooks: Wait staff: Cleaners:

–– Food quality –– Attitude towards both –– Cleanliness of the restaurant
customers and fellow workers –– Cleanliness of the utensils and
–– Food presentation
other equipment used
–– Number of complaints –– Speedy service –– Speed of cleaning
–– Food hygiene –– Remembering orders
–– Tidy appearance
Rewards can include praise and bonuses based on the total amount of sales or the number of customers per
week, month and year.

Activity 25
Sweet Cake owner can provide the skills by:
•• Inviting someone who has experience to train and coach the employees
•• Sending employees to attend training

50 | People and Productivity

PART VI |

WORKPLACE AND PRODUCTIVITY

How you set up and manage your workplace will affect the performance of your workers, the productivity of
your business, and ultimately the profits you will earn.

1. The link between workplace and productivity

Productivity at the workplace includes all processes and activities of the business. The presence or absence
of non-essential materials and equipment cluttering the workspace, the proper storage of materials and
equipment, cleanliness and order, occupational health and safety standards and standardization of procedures
are all common aspects affecting productivity at the workplace.

ACTIVITY 28

What are the benefits that a safe and healthy workplace brings to your business?
...........................................................................................................................................................................................................................

Remember the need “to feel safe and secure in their work” in the Maslow’s Hierarchy of Needs.
A safe and healthy workplace includes the presence of mechanisms to avoid occupational safety or health
hazards in the workplace. Safety hazards include faulty electrical wiring, lack of fire escape provisions,
unguarded machinery or equipment with sharp edges, improper storage of flammable substances, etc. Health
hazards include the lack of equipment to be held or worn by employees to protect them against dust, high
noise levels, fumes, radiation, smoke, etc.
It is also the responsibility of the business to put into place a proper waste management system. This involves
the optimal use of resources like raw materials, water and energy, plus providing for proper waste disposal and,
whenever possible, recycling waste. These measures protect the employees from any waste related toxins that
can damage their health, and they also benefit the environment.
A safe and pleasant workplace brings the following benefits to your business:
•• It helps to reduce the rates of injury and illness, resulting in less staff absences, less staff turnover, and
consequently less productive time lost, which improves the quality of the work.

PART VI | Workplace and productivity | 51

•• It prevents the loss of productive time owing to staff accidents and illnesses, resulting in improved
service quality. It also averts customer dissatisfaction and loss of future business.
•• It prevents damage or loss of equipment, materials, or shop facilities.
•• It helps improve the reputation of the business.
•• Along with provisions for access and movement for employees or customers with disabilities, it ensures
better working conditions.
•• It enables a business to comply with the legal requirements for workers’ safety and also helps in the
identification and rectification of situations that are likely to be raised during regulatory inspections.

“ A business owner who places an emphasis on the conditions of

“
the workplace will have a more productive business.

2. Improving the workplace for higher productivity

Effectiveness is about doing the right things. Efficiency is about doing things right. Productivity is about doing
the right things right. It is not just about working harder, but about working smarter. Working smarter also
means working more safely. The following sections will describe the steps to undertake to make continuous
improvement of productivity.

2.1 Describe your current workflow

Start by looking at what you are doing and at how you are working. Make a diagram of the workflow or list the
operations in the order they are performed.
Lungu from Lungu Metal Workshop describes the operation of his business as illustrated in the pictures on the
next page:

52 | People and Productivity

1 - Buy different types of metal from the wholesaler 2 - Transport materials to the shop

3 - Store materials until they are needed 4 - Make various carts and tools (each item has
a separate workflow)

5 - Display the ready items in the shop and outside 6 - Selling the ready items, taking orders for
new items and receiving payment

PART VI | Workplace and productivity | 53

ACTIVITY 29

How can productivity be improved in each of the six operations? Lungu decides to discuss this in a meeting
with his workers and has the following questions for each of the workflow items:
•• Workflow item 1: Is our present wholesaler the best one available? Should we change our metal
supplier? Which supplier do our competitors use?
•• Workflow item 2: Presently, Lungu owns a truck which is used for collecting supplies. He questions
whether the business should sell the truck and let the suppliers deliver the materials?
•• Workflow item 3: Does our business buy too few or too many raw materials? How can we control the
stock better so that business money is not tied up? How can materials be stored safely and in a way
that they are more easily accessible?
•• Workflow item 4: Is the workstation design comfortable for the employees? Is there a need for any new
equipment? Are occupational safety and health standards maintained in each production process?
How can the business reduce waste in the production process?
•• Workflow item 5: Are the finished products stored and displayed properly?
•• Workflow item 6: Is there a change in the sales volume or selling price? Is it affecting our profit? Are we
keeping adequate records of costs, credit or cash sales and profits?
How do you think Lungu and his workers decide to improve their current workflow?

See the answers on page 63.

2.2 Less waste at the workplace = more efficiency at the workplace

Efficiency is the comparison between what is actually produced or performed and what can be achieved,
consuming the same amount of resources (money, time, labour, etc.). To be more efficient, you should implement
improvements which lead to the reduction of waste in your business. This will increase your productivity.

ACTIVITY 30

One of the measures of increasing efficiency is reducing waste. Make a list of all the waste at your business.

54 | People and Productivity

There are seven common types of waste:

1. Waste from over-production: Producing more than what is needed.
2. Waste of labour and overhead: High worker and machine idle time.
3. Waste of processing: Any operation that does not add value to an item or a service.
4. Waste of stock: Any stock in excess of that required to produce the item or provide the service.
5. Waste due to defects: All repairs or replacement of products made as a result of customer complaints.
6. Waste of employee time and energy: This occurs due to either a lack of skills and/or motivation on
the part of the employees, or because employees are having personal problems.

2.3 Material storage and handling

Efficient storage and handling of parts and products ensures that work flows smoothly and helps to avoid
many delays and bottlenecks. Poor storage and inefficient transport operations, on the other hand, can cause
materials to be damaged or to become old and obsolete before they are used. Improved material storage and
handling will free up space, reduce the time spent searching for tools and materials, lower the capital costs and
provide a smoother flow of materials through the workplace.

2.4 Choice of equipment

For some types of work, manual labour can be

difficult and time consuming. In such cases,
using equipment or machines can not only
reduce the amount of time taken to create
goods or services, but can also reduce waste, The work will be done faster and
improve the quality of the goods and result easier and the drill is safer to
in better working conditions. Purchasing use, so it will pay in the long run!
equipment may be more expensive than
employing labour to do the task manually, but
if the use of equipment can improve worker
safety, then the equipment may be worth more
than just the value of the labour cost.

PART VI | Workplace and productivity | 55

2.5 Workstation design

Most work is carried out at workstations where

workers perform the same task many times My back is hurting. The desk needs
each day. When analysing the workflow at a to be lower in height in order to
workstation, you will note that awkward work match the height of my wheelchair.
posture and unnecessary movement results
in lower productivity and quality, as well as
greater work fatigue and long-term health
problems. Look for simple improvements, such
as stable work surfaces or good chairs. Put
tools and materials within easy reach. If you
have employees with disabilities, make sure
that they have the right equipment needed to
execute their tasks.

3. Good housekeeping

Good housekeeping practices involve what is normally referred to as the five ‘S’s:
•• Sort: The separation of things that are different and the elimination of things that is not necessary.
•• Systematize: The systematic arrangement of items for easy storage and retrieval. Having a place for
everything and having everything in its place.
•• Sweep: The regular cleaning of the workplace and non-essential materials.
•• Standardize: Set clear procedures for different work processes so that the employees are aware of
their responsibilities.
•• Self-discipline: The development of an attitude that will ensure that everyone will spontaneously and
continuously make the five ‘S’s a way of life.

ACTIVITY 31

Using the concept of the five ‘S’s, analyse the Sukuma Cycle Shop:
1. Is this an efficient workplace? What is your opinion?
2. Do you think it can be turned into an efficient workplace? If so, how?

56 | People and Productivity

.............................................................................................

.............................................................................................
Sukuma’s shop is dirtying the
............................................................................................. neighbourhood. We will not use
his services.
.............................................................................................

.............................................................................................

See the answers on page 63.

“ Maintaining a productive workplace requires continuous monitoring

“
and improvements.

4. Preventing workplace related accidents and illnesses

A safe work environment helps to prevent accidents and illnesses. Accidents and illnesses negatively impact
performance and affect worker motivation, which further reduces productivity. As an employer you should
always be alert to any potential causes of accidents, unsafe physical conditions or bad work practices.
The causes of accidents and illnesses may be divided into the following two groups:
•• Unsafe conditions (hazards)
•• Unsafe actions (work practices)
A workshop can operate for some time with unsafe conditions and unsafe actions, without an accident
occurring or an evident sign of health problems. This could give the owner a false sense of security. But, it is
only a matter of time before something in the workplace causes an accident or the workers are affected with a

PART VI | Workplace and productivity | 57

health issue. The following illustrations depict some of the common causes of accidents and long term health
damage that workers are exposed to in businesses:

1. Uncovered electric cables on the floor can 2. Unguarded machines can increase exposure of
electrocute workers and paralyse them for life. its moving parts and increase the
possibility of accidents.

3. Not providing welding helmets exposes the 4. Electric cable on a wet floor can lead to short
workers’ eyes, faces and necks to flash burns, circuits and fire at the workplace,
heat, and ultraviolet and infrared light. Adequate causing fatalities.
hand protection, such as gloves, should always
be provided, as hand injuries are very common.

58 | People and Productivity

5. Manual hoisting and moving of heavy objects, 6. Lack of proper storage of chemicals can result
instead of providing the right equipment for in their leakage and expose workers to
minimizing handling, will expose workers to joint adverse health effects, such as radiation,
and muscle problems in the long run. lung and skin damage.

To reduce the likelihood of accidents and illnesses in your business, pursue the following steps:
Step 1: Plan to prevent accidents and illnesses at the workplace - The prevention of accidents and illnesses
is the most efficient way to maintain a safe workplace. This involves the following:

•• Do maintenance on the equipment

regularly. Poorly maintained machines are
This is dangerous! hazardous. Without proper maintenance,
If this wire becomes
completely loose, parts could come loose, protective guards
somebody can get could become ineffective, the machines
electrocuted. Better might generate a lot of fumes and smoke,
stop the machine, and the operation of the machine can cause
we should fix this
right away! accidents or long-term health damage to the
employees.
•• Improve workstation design and limit
exposure to hazardous materials. This can
be done by setting conditions governing
the design, construction and layout of the
workstation. Ensure that the procedures
defined by the competent authority are
enforced. It is important that the business
owner identifies work processes, substances
and agents which are to be prohibited, limited
or made subject to authorization, taking into
consideration the possibility of exposure to several substances. All containers with such items should be
labelled.
•• Provide protective equipment without any cost to the workers and make sure that the workers use
it correctly. This includes special clothing and devices used to protect the workers from hazards such as
dust, smoke, fumes, chemicals, or high noise levels which can cause health problems in the immediate or

PART VI | Workplace and productivity | 59

near future. These safety devices also protect
the workers from injuries. Ear protection Eyes protective
guards
•• Train your workers to work safely. Every
worker needs to know how to recognize
safety hazards, to be able to report them to Mouth and nose
management and to know what to do in an protection
emergency. This is an essential part of every
worker’s training.
•• Organize your workers to work safely. Protective
Ensure that work organization, particularly gloves
with respect to hours of work and rest breaks,
does not adversely affect the health and safety
of workers. Working long hours is tiring and
increases the risk of workers making mistakes.
It also causes physical and mental fatigue
which might result in health problems for the Steel-tipped
boots
workers. Rotation of work within a team helps
to avoid stressed and tired workers; a recipe
for preventing accidents and illnesses.

Step 2: Carry out regular safety inspections - A safety inspection is a review of the workplace to identify any
hazards or unsafe working practices and conditions. In a small business, this may regularly be accomplished by
the owner and should be done daily. The owner should ask the workers if there are any issues or if they have
suggestions to make about the safety of the workplace.
Step 3: Correct problems immediately - When hazards and unsafe working practices are identified, they
should be corrected immediately. This will reduce the risk of accidents or health problems and increase worker
motivation.
Step 4: Have a plan of action for treating accidents or illnesses - Unfortunately, accidents or illnesses can
occur despite taking all the precautions. It is the responsibility of the business owner to make sure that first-aid
is available and that the workers are taught what to do in an emergency. Here are some questions you should
ask yourself:
•• Do your workers know what to do if there is a fire in your workshop?
•• Do you have a first-aid kit to treat minor injuries or illnesses?
•• How far is the nearest doctor or hospital? What is the address and telephone number?
•• Is your business insured for damage?
•• Are your workers insured for personal injury or illness?
••
••
•• ACTIVITY 32

In a workshop with five employees producing wooden furniture and using hand tools and electric machines:
Name the five safety measures that you consider to be the most essential.

60 | People and Productivity

1. .......................................................................................................................................................................................................................

2. .......................................................................................................................................................................................................................

3. .......................................................................................................................................................................................................................

4. .......................................................................................................................................................................................................................

5. .......................................................................................................................................................................................................................

See the answers on page 63.

ACTIVITY 33

Consider the four steps necessary to create a safe workshop. Prepare a list of actions that you could take to
make your working environment safe. What are the most important safety measures? Have you taken these
measures?

This part has dealt with the workplace and what you can do to improve productivity by creating better working
conditions and by introducing measures to help prevent accidents and illnesses. However, a safe workplace
only creates a good physical environment for the workers. In the next part, we will discuss how workplace
culture can create a good working environment, boost worker morale and promote productivity.

SUMMARY
•• A safe and efficient workplace results in happier workers who do better work, and have higher
productivity.
•• Productivity is about doing the right things correctly. It is not just about working harder, but also about
working smarter. To do this in your business, describe or illustrate your workflow, analyze each operation,
identify obstacles, and look for ways to make improvements.

•• Good housekeeping practices involve what is normally referred to as the five ‘S’s: Sort, Systematize, Sweep,
Standardize and Self-discipline.

PART VI | Workplace and productivity | 61

•• A safe work environment helps to prevent accidents that stop performance and negatively affect worker
motivation. It minimizes the causes of accidents, unsafe physical conditions and bad work practices.
•• To reduce the likelihood of accidents and illnesses in your business, follow the following steps:
–– Step 1: Plan to prevent accidents and illnesses at the workplace
–– Step 2: Carry out regular safety inspections
–– Step 3: Correct problems immediately
–– Step 4: Have a plan of action for treating accidents or illnesses

ASSESSMENT 6

You have just completed Part VI of this manual. Do the exercise below to check your understanding. Finish the
exercise before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. A safe and healthy workplace means…

a. a nicely decorated place.

b. a workplace with minimal occupational and health hazards allowing workers to be productive.
c. a place where people can do whatever they want.

2. Good housekeeping refers to…

a. ensuring that the workshop is well kept and all materials are tidy.
b. the separation and elimination of all things that are not necessary.
c. maintaining an efficient and productive workplace.

3. Accidents may be caused by…

a. hazards only.
b. working practices only.
c. hazards and working practices.

62 | People and Productivity

ANSWERS TO ACTIVITIES

Activity 29

1. Lungu decides to conduct market research and make inquiries about other wholesalers operating in the
market.
2. Lungu needs to analyse the current cost of delivery using his own truck and compare that with the cost of
delivery by the supplier. He will also look into the possibility of using his truck for other operations.
3. Lungu will analyse how much raw material his business uses per week and per month. After that, he will
consider whether he should make smaller or larger purchases and how much the transport will cost if
smaller purchases are made.
For material storage, he will consider renovating the existing space and constructing a shed for protection
from the rain and heat, rather than building a new storage room if the latter is more costly.
4. Lungu gets feedback from his workers and realizes that he needs to expand the workspace, which he can
do by clearing the area of non-essential materials. He also needs to provide more safety equipment to his
workers, such as the much needed eye protective gear. Green technology needs to be incorporated to
reduce waste.
5. Lungu already has descriptions and price labels on his products. However, he will need to sort and display
similar products together so that they can easily be found.
6. Lungu finds that he already has concise and updated records of costs, sales and profit. He does not need to
make any changes in record keeping.

Activity 31
1. It is not an efficient workplace because it is untidy: The non-essential items have not been sorted from the
essential items and are lying on the floor, plus the products are not stored properly so there is not enough
workspace to do the repairs.
2. The workspace can be made efficient by cleaning up, discarding anything that is not necessary, arranging
workbenches and placing tools logically and in a proper order.

Activity 32
1. Machines and tools have proper protection shields.
2. Electric cables are not exposed.
3. Workers have proper safety equipment.
4. Fire extinguishers and a first-aid kit are readily available.
5. All workers have been taught safety procedures.

PART VI | Workplace and productivity | 63

64 | People and Productivity
PART VII |

WORKPLACE CULTURE
AND PRODUCTIVITY
Your workers spend many hours at the workplace. A comfortable workplace culture can make your workers
more efficient and productive.
Workplace culture is a combination of visible and non-visible components. Visible components include
the physical arrangement of your business and the dress code of your workers. Non-visible components
include the values, code of conduct, principles of your business and the relationship between workers and
supervisors.
Normally, the business owner is the person who creates, defines and refines workplace culture. Therefore,
workplace culture usually reflects the personality and management style of its owner. You should make sure
that the workplace culture in your business:
•• Promotes your business growth
•• Focuses on customer satisfaction
•• Makes people feel comfortable doing their jobs
•• Promotes productivity

1. Business values

Business values are important beliefs and ideas

that are shared and committed to by all the people in
your business. These values will have an influence on
employee behaviour and serve as a guideline for all
situations at the workplace.
Different businesses have different values, depending on
the purpose of the business. Business values which can
be applied to every business are loyalty, commitment,
integrity, accountability and respect for the individual.
Values specific to different types of businesses might
be innovation and continued improvement for a
production company, outstanding customer service for a
service business, creativity for a design and art business,
community service for a charity business, etc.

PART VII | Workplace culture and productivity | 65

A business owner needs to decide what values are the most important for the business and should communicate
those values to the workers. He or she needs to lead by example and should use these values in the daily
operation of the company. For instance, if you decide that outstanding customer service is a core value of your
business, you should require that your workers always provide excellent service to customers and you should
use customer satisfaction as an important criterion for performance evaluation.

ACTIVITY 34
What are your business values and how do you communicate them to your workers?

2. Code of conduct

Descriptions of business values are usually very short

and general.

The code of conduct is the set of behavioural rules that

workers should follow to ensure that the business values
are reflected in every activity at the workplace. In other
words, the code of conduct is a detailed description of
the business values. For example, one of your business
values is excellent customer service. You may stipulate
that value in the code of conduct by telling your staff to
respect customers and listen to their feedback.

“ A clearly defined and closely monitored code of conduct should

prevent your business from violating laws and make it a work

“
place where employees feel comfortable about being ethical.

66 | People and Productivity

ACTIVITY 35

Create a code of conduct from the business values that you have defined in the previous activity.

Here are examples of the code of conduct:

•• All people are treated with the same amount of respect, regardless of their race, religion and culture.
Discrimination and harassment in any form will not be tolerated.
•• Innovation and creativity are encouraged. Do not criticize anybody’s ideas.
•• Rule number one: Customers are always right.
•• Everything we do should lead to the goal of increasing productivity.
•• Waste is our enemy. Conservation is our friend.
Usually, as a business owner, you are responsible for creating the code of conduct. But it would be more
effective if you involve workers in the creation of the code. In this way, your workers will not only understand
the code, but will be more responsible for its practice.
If you create the code of conduct by yourself, you should make sure that all your workers understand its
principles. One of the best ways to communicate the code to the workers is through training.

3. Non-discrimination

A good workplace culture is a culture in which there is no discrimination.

Discrimination occurs when one person or a group of people are subjected to unfair treatment based on race,
skin colour, sex, sexual orientation, religion, age, disability, or ethnicity.
Such unfair treatment creates dissatisfaction among the staff, and may lead to either a diminishing motivation
to do a good job, or to them leaving their jobs in exchange for fairer treatment in another workplace. To
ensure that you retain your workforce and that you keep your workers motivated, make sure you are treating
everyone fairly.
Discrimination can occur in recruitment, job assignments, work schedules, compensation, benefits, and
promotion. Here are some examples of discrimination:
•• Hiring and promoting only men and failing to give equal opportunities to women to obtain jobs and
to access training and other career development measures
•• Terminating the contract of a female worker because she is pregnant
•• Terminating the contract of an HIV/AIDS infected employee

PART VII | Workplace culture and productivity | 67

•• Compensating a disabled person at a salary lower than others who perform work of the same value
•• Giving more benefits to a family member who works in your business
•• Showing favouritism to people who are the same race as you
To make sure equal treatment becomes and remains a reality in your business, it is useful to codify the business’
commitment to equality into one or more written documents (such as a policy or code of conduct), and to
involve your staff in monitoring its implementation.
Note that positive action, i.e. action taken to remedy unequal situations which have arisen from past
discrimination, does not constitute discrimination. For example, encouraging women to apply for a job or for
a position on a company’s all-male board would not be discrimination.

“ Discrimination has a negative impact on workers and increases

turnover, which reduces productivity. Moreover, discrimination is
illegal and, therefore, may cause you to spend a lot of time and

“
money to settle a non-discrimination lawsuit.

ACTIVITY 36

Review all the activities in your business. Is there discrimination? How can you remedy it?

4. Engaging in dialogue with your employees

Officially registered workers’ unions or more informal groups act as intermediaries between business owners or
managers and workers. A union or group can be the link between owners and workers who wish to contribute
ideas or offer feedback about policies or treatment at the workplace.
The right of employees to join an association or union is a basic human right that should in all cases be
respected, and their membership in a union or activities carried out as part of their union membership should
never give rise to discriminatory treatment.

68 | People and Productivity

In cases where unions or other official bodies that represent workers do not exist, business owners and managers
should keep in mind the benefits of dialogue with employees and make sure that there are other avenues for
employees to convey their needs, concerns or opinions to the management. For instance, they can schedule
regular meetings between management and employees, suggest that the employees meet to discuss their
experiences and views in private and then appoint a spokesperson to share those ideas with management,
or ask for feedback or ideas anonymously through suggestion boxes or feedback forms. When you ask for
feedback or suggestions, be sincere. Make sure you show your staff that you have seriously considered their
contributions and be open about what action you can or will realistically take on the basis of the suggestions.

5. Managing conflict

When conflict occurs, people are disturbed, time is wasted and productivity decreases. If you ignore conflict,
relations between the workers become strained and your business suffers. Therefore, managing conflict will
improve morale and productivity.
There are several causes of conflict in the workplace:

•• Miscommunication: This is a frequent cause of

The previous
conflict, which might occur because of insufficient worker used to
do this job. Since I was not told to
or incorrect information, or rumours that can result
you have replaced complete this work
in misrepresentation of reality. To eliminate this, when I was hired!
him, you have to
you should regularly communicate with staff about complete the work.
the status of the business and the reasons for the
decisions that you make. Also, you should always be
available to address their concerns.

•• Unclear roles and responsibilities: Uncertainty

about the roles and responsibilities of workers,
supervisors and managers creates conflict. This is
because tasks that are not clearly defined can make
people feel that their co-workers are infringing on
their responsibilities. This type of jealousy and anger
does not occur when there are clearly defined roles
and responsibilities within your business.

•• Personality differences: People have different personalities. Some people are open and friendly, while
others keep to themselves and seem aloof. If people do not accept the different personalities of their co-
workers, conflicts occur. To prevent this type of conflict, you should train workers to be accommodating
and work cooperatively.

PART VII | Workplace culture and productivity | 69

ACTIVITY 37

There is a conflict between an experienced, but slow worker and a new, but more active worker in your
workplace. What would you do to manage this conflict?

See the answers on page 72.

When a conflict between your workers occurs, handle it with the following steps:
1. Take the conflicting parties aside and speak with each of them separately.
2. Give each party a chance to explain the situation. You should listen to their explanations independently.
3. Analyse the situation and determine the root cause of the conflict.
4. Decide on the best way to solve the problem in order to satisfy all the parties involved. For example,
if two workers are not comfortable working together, you might assign one of them to work another
shift or with another team.
5. Follow up to make sure that the root causes are eliminated and the conflict does not reoccur.

ACTIVITY 38

Has conflict ever occurred at your workplace? How did you solve it? Were the workers happy with the solution?

So far, you have learned how to create a safe workplace and a workplace culture that creates a productive
working environment. In the next part, we will discuss how it also pays to look after employees who are in
trouble.

70 | People and Productivity

SUMMARY
•• The ways that people do their jobs, serve customers, communicate and interact with each other are as-
pects of the workplace culture. A comfortable workplace culture can make your workers more efficient
and productive.

•• Business values are important values, beliefs and ideas that are shared and committed to by all the people
in your business. These values will influence all behaviours and serve as a guideline for all situations in the
workplace.

•• The code of conduct is a concrete description of the business values. It is a set of behavioural rules that
workers should follow to ensure that the business values are reflected in every activity at the workplace.

•• A good workplace culture is a culture in which there is no discrimination. This means treating everyone
equally. In addition to equal treatment, a workplace can also practise equitable treatment, which may
mean providing extra incentives or support to persons who have suffered from discrimination in the past.

•• Engaging in dialogue with your workers and respecting freedom of association and their right to or-
ganize does not only make your workers happy but also helps you to communicate and to create better
relations with them.

•• Conflict may occur when people work together. When conflict occurs, people are uncomfortable, time is
wasted and productivity is diminished. Therefore managing conflict will improve morale and productivity
at the workplace.

ASSESSMENT 7

You have just completed Part VII of this manual. Do the exercise below to check your understanding. Finish the
exercises before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. Workplace culture presents the way that…

a. people work together.

b. people interact with customers.
c. people do the job, serve customers, communicate and interact with each other.

PART VII | Workplace culture and productivity | 71

2. Business values are important beliefs and ideas that should be…

a. shared and committed to by all the people who work in the business.
b. created and kept by the business owner.
c. created by customers.

3. The code of conduct tells the people in your business…

a. how they should treat customers.

b. what they should do and shouldn’t do.
c. how they should communicate with each other.

4. Discrimination occurs when…

a. someone is given a favour because he or she performs well.

b. one person or a group of people are subjected to unfair treatment.
c. compensation rates are different for different jobs.

5. One cause of conflict is that…

a. people are unclear about their roles and responsibilities.

b. people receive different salaries for different jobs.
c. people do the same jobs.

ANSWERS TO ACTIVITIES

Activity 37

You can manage the conflict by taking the following steps:

1. Listen carefully to the explanation from each side
2. Analyse the advantages and disadvantages of each side
3. Talk to the conflicting parties about how to work together so that the advantages of one side can
compensate for the disadvantages of the other. For example, experience is an advantage of the
older worker, while enthusiasm and drive is an advantage of the younger employee. If they can work
together, their mutual advantages will translate into higher productivity.
4. Follow up to make sure that conflict does not reoccur

72 | People and Productivity

PART VIII |

MANAGING
EMPLOYEE COMPLEXITIES

1. Do we have a problem?

Two of your staff members are not doing as well as they used to.

Nicolas – smelling of alcohol, late from lunch Henry – coming in late, absenteeism on
breaks, leaving early, taking days off Mondays, calling in sick, sleeping on the job.
without prior notice.

We all have problems. But sometimes the problems of an employee are serious enough to affect his or her
work performance. When this happens, he or she is considered a troubled employee. The most common
problems experienced by employees are:
•• Family and personal difficulties, including financial, marital and health problems
•• Alcohol and drug abuse, often developed as a result of other problems
When you realize that one of your employees is disturbed, you are probably annoyed and uncertain about
what to do, wishing the problem would just go away. Perhaps your first impulse is to dismiss the employee.
But don’t take the easy way out.

PART VIII | Managing employee complexities | 73

“ Problems seldom disappear by themselves. Realize that
employees sometimes have personal problems and that you

“
should try to help them.

2. Identifying the problem

How will you know if one of your workers has family problems, is suffering from alcohol or drug abuse, or has
developed AIDS? Some of the indications that an employee is troubled include:
•• Job performance: Increased absenteeism, declining job performance, wasting time while on the
job, prone to accidents and injuries, disregard for safety, unstable work patterns.
•• Health: The employee is often sick; he or she does not eat at regular intervals and has poor
concentration.
•• Physical appearance: Untidy physical appearance, physical signs of drug use or constant hangovers
from alcohol abuse, unwashed hair and clothing, body odours.
•• Emotions/feelings: Unusually sensitive to advice, resentful of criticism, argumentative and
aggressive, irritable and nervous, moody, uncaring attitude, a change in personal values and beliefs,
passive and/or unresponsive.
•• Social habits and relationships: The employee is visited at the workplace by new ‘friends’, he or she
leaves work to go to places where illicit drugs are available, avoids interaction with supervisors and
work mates, is less communicative, has increased conflict with others and always has excuses for not
performing well.
This employee should know that he
•• Financial: Borrows money from people, is not allowed to drink at work. What
constantly receives phone calls from makes him not follow workplace
rules? I should speak to him.
people to whom he or she owes money
and asks for salary advances.
•• Family: The employee has family
problems, such as fights between family
members, separation from his or her
spouse, divorce, or physical abuse by a
spouse or parent.
•• Legal: The employee is arrested for
drunken driving or illegal drug use or
exhibits aggressive or violent behaviour
which results in legal actions or court
cases.

74 | People and Productivity

“ HIV/AIDS is a big problem in some countries. It is a workplace
issue and should be treated like any other serious illness/
condition in the workplace. This is necessary not only because
it affects the workforce, but also because the workplace, being
part of the local community, has a role to play in the wider
struggle to limit its spread and effect. You should read any

“
available literature and take courses on this issue.

ACTIVITY 39

What do you think are the five most common reasons that an employee is troubled?

See the answers on page 81.

“ Be aware of the symptoms and indications of a troubled employee

“
at your business.

PART VIII | Managing employee complexities | 75

3. Dealing with problems

ACTIVITY 40

You have recognized the signs. You have a troubled employee. So how do you deal with the problem in such a
way that your employee resolves the problems and your business and productivity are not affected?

The following guidelines may help you to achieve both of the above objectives:

Get your facts. Prepare your case

•• Pay attention to changes in job performance and behaviour
•• Establish that the work performance of the employee has fallen below the standards you have set
•• Record the incidents of performance and attendance problems (what has happened? how has it
happened? when did it happen?)

Discussing the problem and seeking solutions

First, ascertain the degree to which you are entitled to receive and act upon confidential information. This
is particularly relevant for health related troubles, including HIV/AIDS. Inform the employee of the extent to
which you will disclose the information to others, for
legal reasons. In the case of HIV/AIDS, job applicants
or workers should not be obliged to reveal HIV-related
Your work is falling behind. Is
personal information. Access to such information there something troubling you?
should be strictly limited to medical personnel and Would you like to talk about it?
such information may only be disclosed if legally
required or with the consent of the person concerned.
Then:
•• Discuss the performance problems with the
employee when they occur
•• Explore ways to solve the job performance
problem. Insist that the employee must
improve

76 | People and Productivity

•• Offer to help to identify the underlying problem, but recognize the pitfalls in taking on the role of a
counsellor
•• In case there are personal problems or health related issues, refer the employee to any community
resources, counselling services or affordable health services that may be available

Acting on the problem

•• Solidarity, care and support should guide the management of employees who are facing problems.
•• Take disciplinary action if it is required by company policy, but make sure it is legal. Note that as with
many other health conditions, HIV infection is not a cause for termination of employment. Affected
persons should be able to work for as long as they are medically fit to execute tasks.
•• Refer the employee to relevant community resources for assistance. For health related issues,
particularly HIV/AIDS, employers can encourage the workers to either take counselling outside the
enterprise, or if the company has an occupational safety and health unit, with a company counsellor.
•• Reach an agreement with the employee on a plan to resolve the problem.
•• Put the agreement in writing and have it signed by both parties.
•• Implement the written plan according to the terms of the agreement.

Providing follow-up and support

•• Stick to the terms of the written agreement
•• Support the employee with open communication
•• Continue to evaluate the changes in job performance
•• Keep in contact with relevant referral resources for feedback on any progress
•• Provide counselling
In dealing with complexities related to employees, mechanisms should be created to encourage openness,
acceptance and support for those workers who disclose their personal problems, especially their HIV status
and ensure that they are not discriminated against nor stigmatized.

ACTIVITY 41

The newly married employee of Hair and Beauty Salon tells the owner that she is regularly beaten by her
husband when he comes home drunk. She doesn’t want to go to the police as she thinks this will make it
worse. Meanwhile, her job performance is suffering, she does not complete her assignments on time and she
cannot concentrate. The owner of Hair and Beauty Salon is worried about the health of her employee and also
concerned that she may have an accident if she does not concentrate on her job.
What would you advise the owner of Hair and Beauty Salon to do?

PART VIII | Managing employee complexities | 77

See the answers on page 81.

4. Preventative measures

You can help your employees by taking preventive actions to deal

with problems from which they could potentially suffer.
Code of conduct: You can prepare a small pamphlet welcoming
employees to your business and spelling out the rules of the
workplace. It should be positive and include sections on dress
code, behaviour, attitude, safety and health. It would be good to
include HIV/AIDS information, the extent to which the owner or
manager can help with personal problems, plus the addresses of
counselling centres.

78 | People and Productivity

Staff meetings: You may arrange staff meetings or training and information events which focus on the
problems of troubled employees, such as alcohol and drug abuse, child abuse, HIV/AIDS, violent spouses and
personal financial issues. You might also send your staff to participate in community meetings where these
issues are discussed.
Make yourself available: Sometimes problems can be averted if the employee in question has someone to
talk to. In some cases that person may be you; the owner or manager of the business. Some troubles may be
averted if you make yourself easily accessible and the workers are not afraid or shy to talk to you.

ACTIVITY 42

You have probably experienced a troubled employee, or perhaps you currently have one employed in your
business. What did you do in the past or what do you intend to do now?

PART VIII | Managing employee complexities | 79

In this part you have learned to deal with employees with complexities and you have been taught that paying
more attention to your staff will help your business to prosper. In the final part, you will learn that good
relationships with people who are not necessarily connected to your business will also benefit your economic
performance.

SUMMARY

•• Your employees may have problems that affect their work performance. When this happens, they are
considered to be troubled employees.
•• Being responsible for the productivity of his or her business, the employer should be able to deal with
troubled employees in a way that helps the employees and keeps the business productive.
•• Learn to read the signs that indicate that you may have a troubled employee working in your business.
•• Deal with the problem by: 1) recognizing that the employee is troubled, 2) discussing the problem with
the employee and seeking solutions, 3) acting on the problem, and 4) providing follow-up and support.
•• Avoid the problems related to troubled employees by taking preventative action, by making a code of
conduct, by providing training and information about how to deal with common problems and by being
easily accessible to employees so that they can discuss their problems with you.

ASSESSMENT 8

You have just completed Part VIII of this manual. Do the exercise below to check your understanding. Finish the
exercise before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. ‘Troubled employees’ is a term used for…

a. employees who always make trouble in the workplace.

b. employees who have a tendency to get into trouble wherever they go.
c. employees with personal problems that negatively affect their work.

2. The first step in dealing with a troubled employee is…

a. acting on the problem right away.

b. asking if he or she needs any help.
c. observing and identifying any changes in job performance and behaviour.

80 | People and Productivity

3. To prevent problems of troubled employees, you should…

a. tell them to never bring their personal issues into the workplace.
b. be available to listen and talk to them about their personal problems.
c. tell them to solve their personal problems at home before going to work.

ANSWERS TO ACTIVITIES

Activity 39

The reasons for troubled employees:

•• Financial problems
•• Emotional problems, depression
•• Drug or alcohol addiction
•• Health problems
•• Family problems, unhappy marriages or partnerships

Activity 41
Dealing with problems:
•• The owner should communicate her concern for the employee’s safety. She should be open to listening
to the employee’s problems and be clear that her role is to try to help and not to judge.
•• The owner should try to get the employee to go to a counselling service and/or to the law enforcement
agency for domestic violence to seek help, and also encourage her to concentrate on the work and the
customers.

PART VIII | Managing employee complexities | 81

82 | People and Productivity
PART IX |

BUSINESS RELATIONS
AND PRODUCTIVITY

1. What about these people?

The relation between people and productivity goes beyond those people who are working directly for you. It
relates to all the people who are in contact with your business. Good external relations and a good reputation
can help a business attract more customers, more investors, good suppliers, good employees and will result
in higher profits. Good relationships with key individuals and institutions in the community also promote the
development of your business.

ACTIVITY 43

Which external relations are important to your business? Make a list.

The following agencies and groups of people are very important to your productivity. In this part, we will
discuss them and identify why they are important:
•• Customers
•• Suppliers
•• Competitors
•• Your family
•• Your neighbours and the community
•• Government agencies, business associations, training institutions, trade unions, financial institutions

PART IX | Business relations and productivity | 83

ACTIVITY 44

Sukuma Cycle Shop employs eight workers, builds a small range of cycles and does some repair work. The
business is located 40 kilometres from the city, where half of its products are sold to retail shops. The other half
is sold to a business in a neighbouring town. A buyer from that business visits the shop every month. The buyer
is always very specific about what he wants and pays promptly on delivery.
Buyers from the city retail shops come to Sukuma Cycle Shop when they want to make a specific order. Lately
sales to the city retail shops have become erratic and unreliable. On a visit to the city, Sukuma noticed that all
the retail shops selling his cycles also sold cycles supplied by other workshops.
Most of the metal and other parts used for producing the cycles at Sukuma’s shop are bought from a dealer in
the city. This is not a problem. But maintaining his welding and metalworking machines is difficult because he
has to depend on unreliable suppliers for spare parts.
Waste is also a problem for Sukuma Cycle Shop. Every month, the shop’s employees dump waste and used parts
in a nearby field. The manufacturing process is dusty and noisy, which sometimes results in complaints from
neighbours.

1. Identify the external relations that the Sukuma Cycle Shop might have.

2. What advice would you give Sukuma with regards to his external relations?

See the answers on page 94.

2. Customer relations

Customers are essential to any business. Without customers there will be no revenue and the business will fail.
Customers will most probably come from the same community as your workers. Their family and friends may
even be customers.
Therefore, it is helpful if your workers also witness that the business has a good relationship with its customers.

84 | People and Productivity

Thank you for
your hospitality!

Some important advice and information about customers:

•• Satisfied customers usually return to do business with the company or store again and are likely to
recommend the business to their family and friends.
•• Dissatisfied customers tell their family and friends about their bad experience and advise them not to
patronize the business.
•• It takes more effort to find a new customer than it takes to keep an existing one.
•• Losing a customer is not just losing the value of an individual sale. It is a permanent loss which may
include the loss of other potential customers.
•• Some unhappy customers will complain, but others will not. When a customer complains, he or she is
giving the business a chance to make things right.
•• When a customer’s complaint is dealt with correctly and the customer is satisfied with the response,
that customer will usually return to do business with the establishment again.

ACTIVITY 45

Jane has a small pottery business. She sells to foreign buyers as well as to local shops, tourists and people
passing by. She visits some major customers, but most of her customers come to her shop, where their first
contact is with her two shop assistants. Pots are arranged in a disorderly manner and shop assistants are very
passive to the customers’ needs. She wants to improve customer relations.

PART IX | Business relations and productivity | 85

1. How can she improve relations with her local customers?

2. How can she improve relations with her foreign customers?

3. How should she improve things in the workshop when customers arrive?

See the answers on page 94.

ACTIVITY 46

Do you have a good relationship with your customers? How do you know? Are these relationships contributing
to higher sales?

To learn more about your customers and how to build and maintain a
good relationship with customers, you should study the IYB MARKETING
MANUAL.

3. Relations with suppliers

Establishing and keeping good relations with your suppliers means that you will receive good quality supplies
and on time, have a higher productivity and earn more profit.
Some important information and advice about suppliers:
•• Like any business, the suppliers want to keep good customers. They seek to do this by providing good
service and quality goods.

86 | People and Productivity

•• Suppliers are a good source of information about business trends. They know about new products,
possible material shortages and price rises.
•• Equipment suppliers can help with good after-sales service and offer good advice and regular supplies
of spare parts.
•• Maintain good relations with suppliers by placing your order early, by properly displaying his or her
goods, and most importantly, by paying on time.
•• Keep checking to make sure that your suppliers are offering the best value for your money. Providing
feedback on their products may result in better quality products being provided, better prices for the
products and better conditions being offered.

ACTIVITY 47

Sukuma uses mostly metal supplies to produce his bicycles. However, he also needs tyres, inner tubes, saddles
and other non-metal items. For these products, he usually shops around for the cheapest prices and buys from
different suppliers.
Is this a good approach? If it is not, then why is it not good?

See the answers on page 94.

ACTIVITY 48

How are your supplier relations? Do you get the best deals possible? Can they be improved by developing
better relations?

See the IYB BUYING AND STOCK CONTROL MANUAL for the purchase
of supplies and managing your suppliers.

PART IX | Business relations and productivity | 87

4. Your family

Your family is also an important business contact. Consider these points:

•• Members of your family may provide you with the capital needed to start or expand your business, or
guarantee bank loans for the needed capital.
•• Some of your family members may work for you and others may be your customers.
•• Family members may help you to contact important customers and suppliers.
•• Your family is important in providing the moral support needed to start and improve your business.

To benefit from your family relations, you should remember this advice:
•• Tell your family members that you want your business to be self-sustainable and that you do not want
to rely on family support forever.
•• Make sure that your family understands that the business is yours and that, although their advice is
important, their influence on business decisions is limited.
•• Separate the money that belongs to the business from your own money and that of your family.
•• If you employ family members, treat and pay them the same as any other member of your staff.

If you maintain good, constructive relations with your family, you can be assured that they will be good
ambassadors for your business. This will help you to achieve improved productivity and higher profits.

5. Your neighbours and your community

Your business operates within your community.

The following is important information and
advice about community relations:
•• People living in your community may be
customers and may either recommend
your business or discourage their friends
from supporting your business.
•• People will form a negative opinion
of your business if it is damaging the
environment.
•• Providing good jobs increases the income
for the people in your community. This
leads to greater purchasing power, more
customers and satisfied employees.

88 | People and Productivity

“
“
Being a good neighbour is good for your business.

ACTIVITY 49

1. What can make a business a good neighbour?

2. What can make a business a bad neighbour?

See the answers on page 94.

ACTIVITY 50

Sukuma Cycle Shop has a large stock of second hand parts, which are often displayed on the pavement. Sukuma
is aware that this does not make him popular with his neighbours and the pedestrians, but thinks that his
business must come first.
1. What risks might he be taking?

2. What might be the cost of his attitude?

PART IX | Business relations and productivity | 89

3. What would you advise him to do?

See the answers on page 95.

ACTIVITY 51
How good are your relations with your neighbours? How can you improve the relations?

6. Competitors

Often your competitors live in the same community. This is a good reason for keeping good relations with
them. In addition, consider this:

•• Your competitors also want their businesses to succeed. You can learn a lot from them by analysing
how they operate.
•• Businesses of the same type are often located on the same street, which helps customers easily find
what they need, brings them to your street and encourages competition as well as cooperation
between the businesses.
•• Competitors may find that the only way to fill a large order is to work with other similar businesses.
•• Competitors may get a quantity discount by joining together to place a large order. In other words:
Cooperate in order to compete in the overall marketplace.
•• Competitors may agree to change their stock range, so as to serve slightly different needs or markets.
This would be advantageous to both businesses.

“ Be careful not to involve your businesses in price fixing or joining

“
together to reduce competition. These practices are illegal.

90 | People and Productivity

7. Other support institutions

A business owner must be aware of the conditions of trade union agreements and must conform to the laws
of the country in which the business is operating. There are several laws and standards that may affect your
business:
•• Laws that don’t allow child labour
Maria, don’t hesitate
•• Laws regarding safety and health to call me if you have
arrangements in the workplace any concern on taxes
and licences.
•• Laws dealing with employment,
discrimination and working conditions
•• Laws to protect the environment,
including laws regarding the proper
handling of hazardous products
•• Laws about paying taxes and
purchasing licences
•• Laws regarding competition
•• Sector specific standards
You need to know the legal standing of your
business. You don’t need to know the details of
all laws and regulations, but you should have a
good knowledge of those that directly concern your business. Good relations should therefore be maintained
with government agencies and trade unions in order to know exactly what should be done to comply with the
relevant regulations. Once such relations are established, they can become a source of valuable information
and advice and may help you to save both money and time.
There are different types of business associations: The owner of a business may find that it is advantageous to
be a member of one or more business associations. Through these associations, you will be able to voice your
concerns and possibly to influence government policy decisions.
Good relations should also be maintained with financial and technical training institutions, as they are an
excellent source of skilled workers.

ACTIVITY 52

Lungu Metal Workshop employs eight workers. The workers do the heavy work. Lungu supervises the workers,
does the more intricate work, makes sure the quality of his products is maintained and attends to the customers.
His sales are good, so Lungu is planning to expand his business. In order to do so, he needs to find more reliable
suppliers, recruit skilful workers and possibly take a loan from bank.
How can better relations with support institutions help Lungu’s business and its expansion?

PART IX | Business relations and productivity | 91

See the answers on page 95.

ACTIVITY 53

Which institutions affect your business? How can you improve relationships with other support institutions to
access their services?

SUMMARY

•• The relationship between people and productivity goes beyond the relations with people working directly
for you. It includes all the people that are in contact with your business. Customers, suppliers, your
neighbours, the community, your competitors, government agencies, business associations, and training
institutions are all important groups with which you should keep a good relationship.
•• Without customers there will be no revenue. Good relations with customers are of the utmost importance.
•• Suppliers are essential to your business as they deliver the goods and materials you work with and/or
sell to your customers. Keeping good relations with suppliers helps to maintain steady supplies of good
quality products at a good price, and therefore higher productivity and profit for your business.
•• Your family is also an important business contact. If you maintain good, constructive relations with your
family, you can be assured that they will be good ambassadors for your business.
•• Businesses that degrade the neighbourhood and cause problems for the neighbours will increasingly
face problems. No worker wants to work for a business that is unpopular with neighbours. Businesses that
care about the impact they have on the neighbourhood will enjoy the support of their community.
•• It pays to keep good relations with competitors in your community. You need to cooperate in order to
compete in the marketplace. There are several things that similar businesses can do together that can
benefit of all of them.

92 | People and Productivity

•• All businesses operate within a regulatory framework. Non-compliance can result in the closure of the
business. Government and trade union officials and agencies can provide useful information and advice
on cost effective ways to comply with regulations. There are also benefits to joining business associations
and keeping in contact with relevant training institutions. Of course, good relations with banks are very
important to your business.

ASSESSMENT 9

You have just completed Part IX of this manual. Do the exercise below to check your understanding. Finish
the exercise before comparing your answers with those on page 103.

Which one is correct?

Circle the correct or best ending for each sentence.

1. To maintain a good relationship with suppliers, you should…

a. contact them every day.

b. visit them regularly.
c. pay them on time.

2. A business can be a good neighbour by…

a. taking care to minimize waste and to dispose of it responsibly.

b. always greeting people.
c. giving gifts on holidays.

3. Good relations with competitors are important because…

a. otherwise they will not be interested in selling their goods to you.

b. you can help and learn from each other.
c. they would want to share the market with you.

PART IX | Business relations and productivity | 93

ANSWERS TO ACTIVITIES

Activity 44

1. Sukuma’s Cycle Shop has good relations with buyers and metal parts suppliers from the neighbouring town.
Relationships are not quite developed with buyers and suppliers of spare parts in the city. The relations
with people in his village are not good.
2. It would help Sukuma’s business if he developed better personal business relations with the buyer from the
neighbouring town and the shop owners in the city. In order to tackle the problem of unreliable suppliers,
Sukuma should investigate the market for spare parts and develop good relationships with other suppliers.
He should clean up the outside of the shop and try to limit pollution. He should listen to his neighbours
and try to address their complaints as soon as possible, because the members of his community are also
customers of his business.

Activity 45

1. She needs to be in the shop often enough to get to know her customers and their needs better and to tell
them that she will always be available if they need her. Train the staff on customer service and sales skills.
2. Unless the owner is the only one speaking the language, she should train the staff to serve the foreign
customers and to call her immediately when a foreign customer arrives. Encourage foreign customers to
make appointments in advance. Her business should be in a position to ship the items to the address of the
customers if needed.
3. The workshop should always look busy, but orderly, with lots of pots on display. The staff should be alert
and helpful, and should know how to answer the questions a customer may ask.

Activity 47

It is not the best approach, as he is not likely to get good service unless he places regular orders and gets to
know the suppliers. Also, he should explore the option of buying in bulk by placing a large order with one or
two reliable suppliers in order to receive cost advantages. Moreover, always buying the cheapest products may
not be the best idea. It is important to buy good quality products.

Activity 49

1. A business can be a good neighbour by:

•• Providing regular employment and good working conditions
•• Minimising waste and disposing it responsibly
•• Controlling emissions of gas, dust and liquid waste
•• Ensuring that any liquid waste does not contaminate local water supplies
•• Controlling excessive noise near people’s homes

94 | People and Productivity

2. A business can be a bad neighbour by:
•• Exploiting the workers by not paying them adequately
•• Discriminating against applicants at the time of recruitment or during their employment
•• Not providing safe and healthy working conditions
•• Dumping waste, particularly toxic waste irresponsibly and in open land or waterways
•• Causing excessive noise and dust
•• Clogging the drains with hard waste
•• Creating safety hazards for local people and especially children

Activity 50

1. By not clearing the pavement, Sukuma is occupying the sidewalk and creating an inconvenience for his
neighbours and for pedestrians. Additionally, the pavement is cluttered with bicycles and spare parts,
which annoys the people living close to his shop. The risk is that the members of the community will be
upset and never buy things from his shop. Also, they might not recommend his shop to their friends and
family members.
2. The cost of being negligent towards his neighbours is that he may lose them as customers.
3. Sukuma should completely clear the sidewalk. He should organize the items and make a clear path for
pedestrians. While he is clearing the path, he should place a sign in front of the shop apologizing for the
inconvenience.

Activity 52

Better relations with business associations may help Lungu to find good suppliers. These business associations
might also link him with banks or other financial institutions and government programmes that provide funds
to small and medium enterprises. Additionally, the associations might be able to help Lungu develop a good
business plan which would enable him to get loans from the banks. By contacting technical training institutions
and receiving students as apprentices he can create a good resource for skilled workers.

PART IX | Business relations and productivity | 95

96 | People and Productivity
WHAT DID YOU LEARN IN
THIS MANUAL?
Now that you have studied the entire manual, try these practical exercises. The exercises will recap the things
that you have learnt and will help you to improve your business by managing your staff better.

The exercises will help you to:

•• Use what you have learnt to solve practical problems (Can You Help?).
•• Take action to improve your business by using what you have learned (Action Plan).
Compare your answers with the Answers at the end of the exercises on pages 103 - 107. If it is difficult for
you to work out an answer, read that part of the manual again. The best way to learn is to finish each exercise
before you look at the answers.
Check the list of Useful Business Words on pages 109-110 to quickly find the meaning of a terminology.

“ You have learned about the relationship between people and

productivity in this manual. But what you have learned does not
help you until you use this knowledge in the daily operation of

“
your business. Remember to prepare the Action Plan on page 82.

What did you learn in this manual? | 97

1. Can You Help?

1.1 Wood’s Carpentry Shop

Wood owns a small carpentry shop and he produced the following table to show how the business has been
performing in the last two years.

Revenue (US$) Units produced

Products
2012 2013 2012 2013
Chest of drawers 1,080 1,150 18 20
Wardrobes 1,200 1,300 6 10
Double beds 27,300 16,500 78 76
Sets of tables and chairs 16,400 21,000 41 45
Doors 20,650 18,200 59 52
Windows 23,600 24,000 118 120
Total 90,230 82,150

Expenses (US$)

Labour 15,380 19,500

Materials 17,500 18,375
Energy 2,750 3,025
Capital 1,050 1,200
Other 1,490 1,639
Total 38,170 43,739

He knows that his production has been increasing, but he is not able to get a clear picture by just looking at
rows of figures. He wants his profit to increase accordingly and he wants to make sure that he gets as much as
possible from the resources he puts into the business.

By answering the following questions, you can help Wood get a better idea of how things are going and what
can be done to make it better:
Question 1: What was Wood’s profit in 2012 and 2013?
Question 2: Which was the most productive year, 2012 or 2013?
Question 3: Give some examples of how Wood can improve the productivity of his business and what
productivity indicators he could use.

1.2 Trader’s Gift Shop

Trader operates a small gift shop and her only employee is a 22 year old man. Trader does most of the work
herself, including buying stock, displaying and stacking shelves and serving customers. Trader’s husband helps
her with the accounts. The young employee is doing very well, but Trader realizes that she has no definite
work schedule for him. He is just doing odd jobs and Trader is worried that he will become bored and leave

98 | People and Productivity

her business. Trader doesn’t want this to happen, as she had hoped that the young employee will get more
involved in the business activities, learn more about the business and eventually take over most of the tasks
currently performed by Trader. Trader would then have more time to spend on activities to expand the business.
With this objective in mind, you can help Trader by doing the following exercises:
Exercise #1: Write a job description that would prepare the young man to take over most of Trader’s work.
Exercise #2: Describe a training programme that Trader could use to develop the young worker’s skills.

1.3 Staff problems in Baker’s Bakery

Baker runs a bakery and employs three people to make the bread and cakes, two to attend to customers and
make sales, and one messenger who helps to clean up. She and her husband organize everything and try to
keep everyone working. Baker is not paying top wages as she doesn’t believe that she gets much value for her
money. She is a tough taskmaster. Employee turnover is constant. However, she hasn’t worried about it too
much as there are enough people wanting a job. Therefore, she usually finds someone else right away. But
Baker is beginning to realize that her business does suffer. Lately production is down, so sales are down and
therefore, there is less income for the bakery. The pastry chefs seem to do as little as possible. They just let the
orders pile up without working harder to fill them. The shop assistants seem to spend more time talking to
each other than attending to customers. The messenger seems to be increasingly unhappy with his job. At first,
he worked very hard, but he is the lowest paid employee and he no longer seems to be motivated.
Baker hopes her staff could be encouraged to work harder so the business would pick up again. She is getting
worried about the slump in sales and she knows that if it continues, she will not earn a profit.
You can help Baker by answering the following questions:
Question 1: What are the most likely reasons for the behaviour of Baker’s staff?
Question 2: Suggest the steps that could be taken to make the staff work harder and take more interest in their
jobs. In what way could the people in the kitchen and those in the shop be treated differently?
Question 3: What about the messenger? Suggest a way to encourage him to do a better job and to get more
involved.

1.4 Problems in Fixit’s Workshop

Fixit has realized that his car repair business is not operating as efficiently as it could be and that there are safety
issues in the shop. One evening, he watched the workers in the workshop and then discussed how the work
was being done. He made the following list of things to consider:
•• Though the workshop was quite large, most of the activities, including spray painting, oil changes,
repairs, maintenance, tyre changes, etc. was being done in one small area of the workshop. The rest
of the space was taken up by both old and new parts, a couple of old cars, tools and general rubbish.
•• There were no particular rules or guideline for how the work should be done.
•• Most of the parts being worked on were placed on the floor and none of them were secured or fastened.
•• The workshop layout left little room for the storage of spare parts and tools. They were usually left near
the door and quite often it would take some time to find the right tool.
•• There was a lot of oil that had spilled on the floor, the lighting was generally poor and the workers had
often complained about a lack of space and uncomfortable working conditions.

What did you learn in this manual? | 99

Fixit would like to make the workshop more efficient and productive. He also wants to make sure that none of
his workers get hurt while on the job. He wants to do something, but he doesn’t know what to do.
You can help him if you can answer these questions:
Question 1: Why are the above-mentioned factors a problem for Fixit’s business? How do they affect
productivity? What accidents could result at the workshop?
Question 2: What can he do about each of these situations in order to improve safety and productivity? Analyze
the cost and benefit of each of your suggestions and evaluate the value of each action.

1.5 Steely, the Head Mechanic

James started his car repair shop because he had a good eye for business and was on very good terms with
Steely who became his head mechanic. James himself is not as qualified a mechanic as Steely and only Steely
knows about electronics. So James relies heavily on Steely for the success of his business.
But lately, Steely’s behaviour is causing James to be concerned. In the past, Steely was always very punctual,
but recently he has been late for work. He arrives at the shop looking tired and smells of alcohol. He has started
to socialize with a group of people who have been in trouble with the police. Steely’s wife has complained to
neighbours that her husband spends most of his salary and doesn’t bring much money home for the family.
James has observed these changes in Steely’s behaviour for some time, but did not pay too much attention
until Steely made a major mistake while repairing a car belonging to one of his good customers. Since that day,
James noticed more mistakes being made and a general decline in the quality of Steely’s work.
James cannot afford to let his business go downhill because of Steely’s mistakes. He is worried that an accident
could happen if the situation does not improve. He wants to do something about it, but he doesn’t know what
to do.
You can help James if you can answer the following questions:
Question 1: What are the most likely causes of Steely’s behaviour and poor work performance?
Question 2: What steps would you take to resolve the situation?

1.6 The Unpopular Workshop

Brown has operated his workshop for five years. During that time profits increased every year. He has always
used every opportunity to save money: his workers are paid as little as possible and he pays very few taxes
because of his friendship with the local tax official. Despite several complaints by neighbours, he never did
anything to keep his pile of old cars and spare parts covered and to reduce the noise level.
But now he faces three problems. A group of neighbours are threatening to report the mess and the noise to
the local authorities, his workers are threatening to quit because they are paid less than the minimum wage
and a new tax official is going to take over the job of Brown’s friend.
Question 1: Where did Brown go wrong in his external relations? How could his business ethics affect
productivity?
Question 2: What is the best advice you can give Brown at this stage?

100 | People and Productivity

2. Action plan

HOW WHO WHEN

WHAT
do you solve the will solve the will the problem
is the problem?
problem? problem? be solved?
It should be done
My employees I will find out I will do it, but
before the busy
don’t seem to exactly what each I will have to
season starts, so
know what they employee should discuss it with
I will do it before
are supposed to do and then make my employees so
May.
do. They don’t a job description that we can make
feel responsible. for each job. appropriate job
descriptions for
each one.

How can your business improve productivity through better relations with people and through human resource
management? Start by making an Action Plan. In your plan, record:
1. What are the main problems that your business has in people management?
2. How will you solve each problem?
3. Who will solve each problem (you or someone else)?
4. When do you plan to solve each problem?

Write down your action plan on the next page. Remember these suggestions:
•• Make a plan for a three or six month period
•• Be realistic. Only write down what you think is possible to do
•• Try to solve the most urgent problem first
•• Keep this manual at your business so that you and others in your business can use it when you need it
•• Check regularly to make sure that you are following your action plan. It is a good idea to check every
week
•• Consider putting your action plan on the wall so it is easy to see and check

What did you learn in this manual? | 101

Plan to improve your people and productivity
Use this page to write down your own plan to improve the people management and productivity in your business.
WHAT HOW WHO WHEN
is the problem? do you solve the problem? will solve the problem? will the problem be solved?

102 | People and Productivity

ANSWERS

Assessment 1

1b; 2c; 3c

Assessment 2

1c; 2a; 3a

Assessment 3

1b; 2a

Assessment 4

1b; 2a; 3c; 4a; 5c

Assessment 5

1c; 2a; 3c; 4b; 5a

Assessment 6

1b; 2a; 3c

Assessment 7

1c; 2a; 3b; 4b; 5a

Assessment 8

1c; 2c; 3b

Assessment 9

1c; 2a; 3b

Can you help?

Wood’s Carpentry Shop

Question 1:
$52,060 and $38,411
Question 2:
2012 ($90,230/$38,170 = 2.36), and 2013 ($82,150/$43,739 = 1.88). The calculation shows that it costs much
less to earn higher revenue in 2012 than in 2013.
Question 3:
Wood received $200 for each wardrobe in 2012, but only $130 in 2013. The price of double beds dropped from
$350 in 2012 to $217 in 2013. Perhaps prices can be increased. On the other hand, the price per set of tables

What did you learn in this manual? | 103

and chairs had increased from $400 in 2012 to $466 in 2013. While the higher price may result in more income,
it could also be too high as compared to the competition and therefore reduce sales. Production has remained
just about the same over the two years, but expenses have increased by 15%, largely due to a 27% increase in
the cost of labour. Productivity has dropped and action should be taken in this regard. Possible productivity
indicators could be 1) the total number of units produced per week or month, 2) the number of units produced
per week or month per worker or team of workers, 3) the number of returns and reworks due to poor quality,
and 4) the number of units sold per month due to better marketing efforts.

The Trader’s Gift Shop

Exercise 1:
A possible job description could look like the following, but should be more elaborate and detailed:

Title: Shop Assistant

Responsible to: The shop owner (Trader)
Description of the job: As directed by the shop owner, the shop assistant is responsible for
ordering and receiving stock for resale, displaying stock on shelves,
attending to customers, and maintaining the general order and
cleanliness of the shop.
Specific duties: 1. Once a week, prepare a list of goods to be ordered from the major
supplier. Discuss the list with the owner and then place the order
2. Ensure that all stock is stored properly and attractively displayed in
the selling area of the shop
3. Attend to the customers and call for assistance if needed. Don’t let
the customers wait
4. Keep the shop tidy and clean at all times. Once a week do a
thorough clean-up
5. Carry out any other duties that may be assigned by the owner
Qualifications required: Must have completed a secondary education, relevant courses related
to retailing or other relevant trade, and must have at least one year of
experience in retail, preferably in one or more gift shops or supermarkets.

Exercise 2:

As it is a small business, the skills training and development of the young worker would mostly be on the job
training. The approach might be as follows:
•• First the owner would show the worker exactly how the following jobs are to be done: Purchasing,
stacking of shelves, displaying gift items, daily and weekly cleaning.
•• Then the young man would gradually be told to take over the responsibility for these duties one at a
time. In the order of difficulty, he should start with cleaning, and then stacking shelves, displaying the
items and, lastly, purchasing. To supplement the on the job training, Trader could also arrange for the
young man to attend short, practical courses related to the stocking and operation of a gift shop. If
she wants him to take over the full management of the shop in the future, she should also have him
attend management related courses which include subjects such as accounting, financial control,
marketing, etc.

104 | People and Productivity

Staff Problems in Baker’s Bakery

Question 1:
As she does not make much effort to try to find the best workers, Baker has most likely hired the wrong people
in the first place. Combine this with low wages and with constant harassment by Baker, it is no wonder that
they are not motivated and that they take no interest in the job.
Question 2:
Baker should start by being more careful when employing her staff. She should make proper job descriptions
for all the employees and she should pay more reasonable wages. She could then encourage her staff to work
harder by offering salary incentives for good work, such as a bonus for high sales. She should appraise the
staff’s individual performance, reward good work, and by doing that, make the staff feel responsible for their
part of the business. Baker shouldn’t just boss them around. She can also arrange for them to attend training
courses or call experienced bakers to teach the chefs new recipes or icing techniques to further develop their
capabilities. Two teams may be established among the staff; one consisting of the people in the kitchen who
are rewarded for quality and speed, and the other consisting of the shop assistants and messenger who are
evaluated on how orderly they keep the shop and treat the customers. At the end of each month, both teams
could receive a bonus based on their performance and the total sales for the month.
Question 3:
The messenger has done his job very well for quite a long time. He is obviously unhappy because he is still
paid the lowest wage and has not been promoted to a better position. He could be motivated in several ways.
One way is to increase his pay. Another way of making him feel appreciated would be to let him learn to do the
other jobs at the shop. Apart from developing the messenger’s abilities and increasing his job satisfaction, this
would also serve Baker’s Bakery by providing the opportunity to the messenger to take one of the jobs when
a vacancy occurs.

Problems in Fixit’s Workshop

Question 1:
The factors highlighted in Fixit’s workshop are a problem for his business because it indicates that his workshop
is disorganized. There is also lack of basic health and safety measures. These problems reduce the efficiency of
his business and workers and thereby, reduce the productivity of his business. Each of the problems highlighted
in Fixit’s workshop affect the productivity in the following ways:
•• The lack of an organized system for storage and the space taken up by rubbish would leave too little
room to do the work properly.
•• When there is no guideline for how the work should be done, the workers may not know what
equipment to use and which protective gear to wear while working. This puts the safety and health of
workers at risk and negatively impacts their productivity.
•• Working on parts that are unsecured on the floor is unsafe. They can move around and cause tools or
machines to slip and hurt the workers.
•• When storage of equipment is not organized, time is wasted looking for tools and spare parts.
•• Oil spills on the floor can cause workers to slip, fall and hurt themselves. This is particularly dangerous
when there are heavy metal items being carried or worked on near the spills.
•• Quality work is difficult to accomplish due to an uncomfortable work environment and poor lighting.

What did you learn in this manual? | 105

Question 2:
Various solutions may be suggested for the productivity and safety problems of Fixit’s workshop. Some obvious
ones are listed below:
•• Sketches and a diagrams of workflow related to the different operations should be made. Then it
should be possible to arrive at an overall plan of how best to utilize the workshop area.
•• After creating such plan on paper, the next job would be to undertake a major reorganization and
clean-up of the workshop. Each operation and job, along with the necessary work benches and
equipment, would have a specific area in the workshop. Separate areas would be assigned for storage
of equipment, used parts and rubbish.
•• Tools and equipment associated with specific operations would also have their designated places on
special shelves or wallboards.
•• The lighting would also be upgraded as part of the reorganization of the workshop. It would be brighter
and would be placed so as to provide correct illumination for each of the various workstations.
•• Work routines aimed at maximizing production would be discussed and agreed upon by both
management and employees.
•• Rules relating to safety would be introduced and made clear to all employees.
•• The cost of introducing these changes would mainly relate to the new work benches, the upgraded
the lighting system and the shelves or wall boards for the tools. Considering the greater productivity
and safety that would be achieved, the cost would be justified.

Steely, the Head Mechanic

Question 1:
Observing Steely’s behaviour it seems certain that he is a troubled employee. He has probably become the
victim of some kind of substance abuse. He probably keeps the wrong company, with friends that encourage
him to be involved in such activities. This is affecting his work and he has, therefore, become more prone to
making mistakes.
Question 2:
As Steely’s employer, your productivity and income will suffer because of his problem and poor work
performance. To avoid this you could do the following:
•• Recognize that the employee is troubled and keep a record of number of times he comes late to work
and his poor work performance.
•• Meet privately with the employee to discuss his poor performance. Inquire if there is something
troubling him to help identify the root cause of the problem. Insist that he improve, but also offer to
help by providing solutions to the problem.
•• Act on the problem by reaching an agreement with Steely that he will improve his work quality to
meet acceptable standards. Also, refer him to a doctor or to a relevant community resource that can
help him overcome his problem.
•• Follow-up by monitoring his work performance and support him by checking that he has taken your
advice and is seeing the counsellor or is going to the community service agency for help. Make yourself
available to talk when necessary so that Steely never feels alone while dealing with his problem.

106 | People and Productivity

The Unpopular Workshop
Question 1:
He has maintained good relations with an obviously corrupt tax official and by paying a bribe has avoided a
large tax bill. While it is positive to have good relations with government offices and officials, such personal
arrangements are illegal and are likely to backfire in the long run. He is paying his workers poorly and it
seems that he is not aware of the consequences. No effort had been made to develop good relations with his
neighbours and this has led to a simmering grievance that has come to the surface. The survival of his business
is now at stake, as his productivity and profits will be disastrously affected if he is made to pay back taxes to the
government, as well as compensate the workers and the neighbours.
Question 2:
His relations with the neighbours can perhaps be re-established if he builds a wall to screen off his old cars and
spare parts, reduces the noise as much as possible and combines this with some kind of goodwill gesture, like
inviting the neighbours to a party when the wall is completed. He may then win their friendship and support.
With regards to his workers, he should contact the local government office to find out about the minimum
wage or the industry standards for paying people in that profession. If he increases the wages accordingly,
the workers should be willing to keep working for him. The tax problem will be more difficult to overcome.
He would probably have to pay the full amount, plus penalties and maybe everything that he owes from
previous years.

What did you learn in this manual? | 107

108 | People and Productivity
USEFUL BUSINESS WORDS
MORE ON
WORD THE WORD MEANS
PAGE
Business values Important beliefs and ideas that are shared and committed to by all the 65
people in a business

Code of A set of behavioural rules that people should follow to ensure that the 66
conduct business values are reflected in every activity at the workplace

Discrimination One person or a group of people that are subjected to unfair treatment 33-35, 67

Financial Awards that make people want to do certain things. Incentives are most 40
incentives effective when linked to performance

Good Maintaining an efficient and productive workplace 56

housekeeping

Human A strategic process of recruiting people, training and coaching them, 21-22
resource motivating and rewarding them, etc.
management

Input What is required to produce the output 1

Job description A work programme for one person 28-30, 35

Motivational Needs that, if satisfied, motivate people to do certain things 39-40

needs

Organization The way that an organization arranges people and jobs 19-20, 22
structure

Output What is produced or sold by a business 1

Performance Evaluation of the performance of an employee 43

appraisal

Productivity Indicates the degree to which your resources are put to good use 1, 15

Useful business words | 109

MORE ON
WORD THE WORD MEANS
PAGE
Productivity Things and actions that affect productivity positively or negatively 9-10, 15
factors

Productivity Factors of productivity that are specific and used for measuring and 11-13, 15
indicators monitoring changes in productivity

Troubled An employee with personal problems that affect his work performance 73
worker negatively

Workflow A sequence of actions taken to produce a given result 52-54

Workplace The way that people in a business do their jobs, serve customers, 65
culture communicate and interact with each other

Workstation A place at work for performing a specific job, often by one worker 56

110 | People and Productivity

People and Productivity
Started your business already, but have troubles in some aspects of business management?

Improve Your Business (IYB) is the existing entrepreneurs’ guide to good principles of business
management. The IYB People and Productivity manual helps businesses to select the right
people and motivate them to be more productive by providing a ‘decent work’ environment.

IYB is part of the ‘Start and Improve Your Business’ family of management training courses for
start-ups and small entrepreneurs. The programme builds on 25 years of experience working
in 100 countries, partnering with 2500 local institutions, 200 certified Master Trainers and a
network of over 17,000 Trainers. It has reached 6 million clients to date and these numbers
are only increasing!

The IYB training is supported by a set of six manuals:

IYB Costing
IYB Marketing
IYB Record Keeping
IYB Buying and Stock Control
IYB Planning For Your Business
IYB People and Productivity

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