"Everything Comes Back to Productivity": Why It's Now a Management Habit, Not Just a Metric

Published January 2026 • 11 min read

For years, productivity was treated as an abstract economic indicator - something governments worried about and economists debated. But after a prolonged period of stagnant or declining productivity growth across developed economies, business leaders are waking up to a stark reality: productivity isn't just a macroeconomic concern. It's a survival imperative.

In boardrooms and management meetings across Australia and globally, productivity has shifted from an occasional agenda item to a central management discipline - a habit that needs to be built into daily operations, not just measured quarterly.

"Everything comes back to productivity. When margins are squeezed, when costs are rising, when competition is fierce - the businesses that have built productivity into their DNA are the ones that survive."

The Productivity Crisis No One Saw Coming

Australia's productivity performance has been declining for over a decade, but the post-pandemic period has accelerated concerns:

• Multifactor productivity (the efficiency with which labour and capital are combined) has stagnated since 2019
• Labour productivity growth has slowed to its lowest levels since the 1990s recession
• Business investment in productivity-enhancing technology hasn't translated into expected gains
• Services sector - now 80% of the economy - has proven harder to automate than manufacturing

The result? Businesses are finding it increasingly difficult to maintain margins without passing costs to customers, leading to the inflation pressures that have defined recent years.

Why Productivity Is Now a "Management Habit"

The shift from treating productivity as a metric to treating it as a habit reflects a fundamental change in management thinking:

1. From Annual Reviews to Daily Practice

Traditional productivity improvement involved periodic reviews, consultancy projects, and one-off initiatives. The new approach embeds productivity thinking into daily management routines:

• Morning standups that identify and remove blockers
• Weekly process audits looking for friction points
• Regular time tracking to understand where effort goes
• Continuous feedback loops between teams

2. From Cost Cutting to Value Creation

The old productivity playbook focused on doing the same with less - often through headcount reduction. The modern approach focuses on doing more with the same - enabling existing staff to create more value:

• Automating repetitive tasks so people focus on high-value work
• Eliminating meetings that don't produce decisions
• Investing in tools that multiply individual capability
• Removing approval bottlenecks that slow execution

3. From Top-Down to Everyone's Responsibility

Productivity used to be the concern of operations managers and efficiency consultants. Now, every team member is expected to think about how to work more effectively:

• Frontline workers are empowered to suggest process improvements
• Teams own their own productivity metrics
• Individual contributors are judged on output, not just effort
• Knowledge sharing is systematised, not left to chance

The Margin Protection Imperative

Why has productivity become so urgent? The answer lies in margin pressure from multiple directions:

Building Productivity as a Management Habit

Start with Measurement

You can't improve what you don't measure. But the right metrics matter more than comprehensive measurement:

• Output per hour worked - the fundamental productivity metric
• Cycle time - how long key processes take from start to finish
• First-time-right rate - work that doesn't need rework
• Capacity utilisation - how much of potential output is achieved
• Value-added time ratio - time spent on value-creating vs administrative work

Eliminate Friction Before Adding Tools

The instinct is often to solve productivity problems with new technology. But most productivity gains come from removing friction in existing processes:

1. Map current processes - understand how work actually flows (not how it's supposed to)
2. Identify wait times - where does work sit waiting for approvals, inputs, or decisions?
3. Find handoff failures - where does information get lost between people or teams?
4. Spot duplicate effort - what work is done multiple times by different people?
5. Question necessity - what activities exist because "we've always done it this way"?

Create Productivity Rituals

Habits are built through consistent rituals. Productivity-focused organisations build these into their operating rhythm:

• Daily: Quick standups focused on blockers and priorities
• Weekly: Process review sessions where teams identify one improvement
• Monthly: Productivity metrics review with the leadership team
• Quarterly: Deep-dive process audits on high-impact areas
• Annually: Strategic review of technology and capability investments

Invest in Force Multipliers

Some investments create disproportionate productivity gains - tools that multiply individual capability:

• Automation - taking humans out of routine, repetitive tasks
• Templates and standards - not reinventing the wheel each time
• Knowledge management - making expertise accessible to all
• Self-service tools - reducing dependency on specialists
• AI assistance - augmenting human decision-making and content creation

Common Productivity Killers to Eliminate

Meeting Overload

The average knowledge worker spends 23 hours per week in meetings - up from 10 hours in the 1960s. Most of this time produces no decisions or outcomes. Ruthlessly evaluate whether each meeting is necessary, who really needs to attend, and whether the outcome could be achieved asynchronously.

Context Switching

Every interruption costs 23 minutes of refocusing time. Email notifications, chat messages, and unscheduled requests fragment attention and destroy deep work. Create protected time for focused work and batch communications into defined windows.

Approval Bottlenecks

Work sitting in someone's inbox waiting for approval is work not getting done. Push decision authority down, create clear escalation criteria, and set approval SLAs that create accountability.

Information Hunting

Knowledge workers spend 20% of their time looking for information or people who can help. Invest in knowledge management, documentation, and making expertise findable.

Manual Data Entry

Any data that's entered more than once represents waste. Integrate systems, automate data flows, and eliminate the double-handling that creates both errors and inefficiency.

The Role of Technology

Technology is an enabler of productivity, not a solution in itself. The businesses seeing real productivity gains follow a clear hierarchy:

1. Eliminate: Stop doing work that doesn't add value
2. Simplify: Reduce complexity in remaining work
3. Standardise: Create consistent, repeatable processes
4. Automate: Use technology to handle routine execution
5. Optimise: Continuously improve with data and feedback

Technology investments that skip the first three steps often fail - automating a bad process just creates faster bad outcomes.

Productivity and People

A critical distinction: productivity is about getting more value from work, not extracting more work from people. Sustainable productivity improvement requires:

• Capability development - helping people do their jobs better
• Tool investment - giving people what they need to be effective
• Environment design - creating conditions for focused work
• Clarity of purpose - ensuring people know what matters
• Autonomy - trusting people to manage their own productivity

Businesses that treat productivity as "doing more with less people" create burnout, turnover, and ultimately lower productivity. The sustainable approach is "helping each person do more valuable work."

Making Productivity Stick

The difference between a productivity project and a productivity habit is sustainability. Projects end; habits persist. To make productivity improvement permanent:

• Make it visible: Display productivity metrics where teams can see them
• Celebrate improvements: Recognise and reward productivity gains
• Learn from setbacks: Analyse why productivity dips occur
• Share best practices: Spread what works across the organisation
• Keep raising the bar: Once one level is achieved, aim higher

Productivity as a management habit isn't about working harder - it's about working smarter, systematically and continuously. In an era of margin pressure and competitive intensity, businesses that build this habit into their culture will be the ones that thrive.