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The Productivity Myth

Americans are working 10 percent fewer total hours than we did before the recession, but are producing nearly as many goods and services as we were back in the full employment days of 2007. Is this increase in efficiency good news?
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Do you work for a company in which there have been significant layoffs during the last 18 months? Are you working harder as a result? Is it taking a toll?

Productivity numbers are up. Overall, Americans are working 10 percent fewer total hours than they did before the recession, due to layoffs and shortened workdays, but we're producing nearly as many goods and services as we did back in the full employment days of 2007.

These sorts of gains are typically viewed as a good thing for companies, and therefore for the economy. It's called efficiency. Advances in technology account for many of the productivity gains over the past two decades.

In this case, fewer people are getting more done.

But is it good news? Is more, bigger, faster for longer necessarily better?

Americans already put in 350 hours a year more than our counterparts in Western Europe -- some nine weeks a year. And that doesn't include the uncounted shadow work that technology -- most of all email -- makes possible after the regular workday ends.

Here's the bigger point. Just as you'll eventually go broke if you make constant withdrawals from your bank account without offsetting deposits, you will also ultimately burn yourself out if you spend too much energy too continuously at work without sufficient renewal.

Consider this:

 The average American sleeps 6 ½ hours a night -- and the costs include not just much higher rates of illness, but also significantly worse performance.

 A comprehensive study by Ernst & Young showed that the longer the vacation their employees took, the better they performed. Yet more than half of all Americans now fail to take all of their vacation days and 30 per cent of Americans use less than half their allotted vacation time.

 Working more than 50 hours a week has been correlated in a raft of studies with less sleep, less physical activity, higher job dissatisfaction and ultimately worse performance.

 In our own work in companies, we've consistently observed that the longer and more continuously people work, the less marginal return they get from each additional hour -- and the more alienated and disengaged they become.

When I first wrote about this subject in an HBR blog last week, a number of readers fired back that the real reason for productivity gains is that recession has allowed companies to eliminate low performers.

That's almost certainly so, but is there any doubt that tens of thousands of high performers have also been laid off?

The unseen driver of high performance may well be fear. If colleagues around us are being laid off and cut back, we can't help worrying that our jobs may be next. Our survival instincts kick in, and we push ourselves harder, so we're not the next one to go.

Getting more tasks accomplished -- say, writing and responding to scores of emails in between other activities -- may technically represent higher productivity, but it doesn't necessarily mean adding greater value. Fear is a poor source of long-term fuel.

To the contrary, the ethic of more, bigger, faster ultimately generates value that is narrow, shallow and short-term.

Did Toyota do itself or its customers any good by finding a way to accelerate production and expand sales over the past decade? As its president Akio Toyoda acknowledged in a speech to his own leaders: "Some executives just got too big headed and focused too excessively on profit." What suffered was the reliability and quality of Toyota's cars -- a reputation that took years to build but only days to unravel.

Did it serve us well that bankers and brokers sold an unprecedented number of mortgages during the years of the housing boom, with minimal background checks, or that they created all kinds of new financial instruments that generated huge profits before they crashed and burned in 2008?

When you're running as fast as you can, what gets sacrificed is attention to detail and time to step back, reflect on the big picture, and truly think strategically and long-term.

If you operate at high intensity, under high pressure, for long hours, you inexorably burn down your own best resources -- your energy reservoir -- and you begin to rely instead on the physiology of fight or flight: adrenalin, noradrenalin, and cortisol. In fight or flight, the prefrontal cortex shuts down, your perspective narrows, and your primitive instincts begin to take over.

We need a better way of working. It's not about generating short-term, superficial productivity gains by using fear as a motivator and then squeezing people to their limits. Rather, it depends on recognizing that more is not always better, and that renewal, reflection, and a long-term perspective are also critical to fueling value that lasts.

It may seem counterintuitive, but the best way to work more effectively and sustainably is to find ways to intermittently renew during the day (and on weekends and over vacations).

That's what will make it possible for you to work at your best when you are working. It's also the path to sustainable productivity.

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