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Making Canada's SMEs More Productive

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Canadian businesses have fallen far behind their foreign counterparts in competitiveness. Private-sector enterprises should increase internal efforts to be more productive and compete internationally. But before this happens, managers must ensure that the organizational factors that nurture productivity growth are aligned. The Three Pillars of Productivity (3POP) framework presented in this article uses strategy, operations and technology as three pillars that stand upon a base of solid organizational culture. <br><br>Strategy, the first pillar, is usually given minimal attention by SMEs, who focus instead on tactical operations. However, SMEs that follow strategy-execution processes almost always outperform those that do not. After clarifying a company’s mission and performing strategic analysis, a firm should execute its strategy through its operations. This pillar is more flexible and open to continual adjustment, especially in smaller firms. Finally, using technology and collecting quantitative and qualitative data to support decisions is critical, but the wrong investment can make or break a business. While aligning the three pillars is key, the first step to significant productivity improvements is creating a supportive culture. Willingness to change, tolerance for failure and acceptance of calculated risk are almost always needed to realize strong productivity gains. Ultimately, culture characterizes a firm more than any other part of the framework.
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