How management practices impact productivity and financial performance | The Oxford Review - OR Briefings

How management practices impact productivity and financial performance

Research Briefing

Keywords: managers, management practices, advanced management practices, productivity, organisational productivity, financial performance

A number of recent research studies have shown that much of the variation in productivity that is seen across organisations is due to the differences in use of various management practices. The studies have all found that management practices, such as monitoring the use of incentives and goals, for example, tend to affect employee decision-making and effort and, consequently, productivity.

Where management practices take account of employee skills and knowledge there is a significant improvement in productivity and we find that better managed organisations also tend to recruit higher ability employees and have pay and reward practices that help to retain the better workers.

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