How does a government kickstart productivity improvement?

Well one possible answer Is to benchmark and challenge.

A government can set up benchmarking across specific sectors it thinks are important for future growth.

It starts by asking firms in the sector what is important in creating future growth – and then setting up a measurement scheme to establish comparative measures for each of those factors.

A summary of these measures is then issued to participating firms – say, the average across the sector and the ‘best’ for each factor.  (This can, of course, be anonymous.)

Firms can then see how their own performance compares to these average and best scores.  They now know the art of the possible and are faced with the challenge of raising their own performance to beat the average and strive to equal the best for each factor.  They do this in the knowledge that established firms in their sector are reaching these levels of performance already – they are realistically achievable.

The benchmarking process can be repeated annually to see how performance is shifting.

Realistic targets establish a meaningful challenge.