New Zealand is struggling to keep up with its peers in wealth generation and its leaders are struggling to understand the root causes and how to change them.
The easy measure of business activity is productivity - and business owners are often criticised for the lack of it. Does this mean we don't work hard enough? Are we complacent; settling for the "bach, boat and BMW" rather than striving for the national good?
My view is that, aside from our small local markets not offering the aspirations and hardening fire of strong competition, our productivity problem is a capital problem. New Zealand's venture capital is broken, such that passionate entrepreneurs often have to seek offshore funding to grow.
Capital enables investment in machines, and machines work. Automation is what accelerates processing and output speed far more than flogging people - particularly in a country where skills are scarce. The paradox, in fact, for people is that they will output more if given the chance and not treated like computers. Better to recognise the importance of thinking time and the process of creative focus - especially for people charged with making new things or solving problems.
The solution to our productivity problem is to invest in automation, to release our intelligence to focus on human touch-points and high return fixes by enabling machines to run the repetitive tasks. The challenge is our approach to investment; maybe there are big answers in our capital market system (med report - pdf), but at an individual business level, the answers lie in recognising the different time value of machines vs people:
Machines should work, people should think (IBM Pollyanna principle).