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Understanding and Explaining Management Practices to Promote Higher Productivity in UK Businesses

Funder: UK Research and InnovationProject code: ES/S012729/2
Funded under: ESRC Funder Contribution: 498,125 GBP

Understanding and Explaining Management Practices to Promote Higher Productivity in UK Businesses

Description

Our Management and Expectations Survey (MES), cited in the ESRC call, arose from a partnership between the ONS and ESCoE: it is the largest ever survey of UK management capabilities, executed on a population of 25,000 firms across industries, regions, firm sizes and ages documenting the variable quality of management practices across UK businesses. Our analysis found a significant relationship between management practices and labour productivity amongst UK firms, and examined whether certain types of firms have poor management practices and stagnant productivity, drawing conclusions about the links between them, ONS (2018). This team, with two seminal contributors to management practice and performance (Bloom, Stanford, and Van Reenen, MIT) who initiated the World Management Survey, partners from the ONS (Awano, Dolby, Vyas, Wales), and the Director and Fellows of the ESCoE (Riley, Mizen, Senga, Sleeman) at the NIESR, will investigate five issues: 1. Longitudinal changes in management practices and performance The initial MES offers a cross section of variation in management practices and expectations between firms, but it does not explore variations within businesses through time due to the missing longitudinal dimension to the data. A second wave of the MES will expand our scope of analysis so that we can interpret how management practices in the UK have varied over time. This extension addresses the 'broad consensus' from the recent ESRC-ONS workshop that 'there is not enough longitudinal data around productivity that allows for consistent, ongoing analysis, and in particular data that enables researchers to identify, isolate and accurately measure changes over time.' 2. International comparisons Drawing on our links through Bloom and Van Reenen with the US Management and Organizational Practices Survey (MOPS) at the US Census Bureau will enable us to i) test identical hypotheses using their methods and variables to draw research insights that help identify causal drivers of productivity at the firm level, and compare and contrast the UK and US data; ii) draw together a unique joint ONS-Census Bureau methodological forum for collecting the most useful micro-data for measuring management, investment and hiring intentions for UK and US firms. Similar data collection exercises have been taking place across other countries. We have established links with German and Japanese teams and we intend to discuss key differences, e.g. between the US and European business environments, and similarities, e.g. the Japanese experience of low productivity. 3. Analysis of linked business surveys and administrative data Partnership between academic researchers and ONS facilitates the matching of data from other sources to answer key questions around: a) management and firms' ability to cope with uncertainty by linking MES responses to trade data, administrative data on VAT, R&D expenditure, and patenting data, and exploiting variation across firms in exposure to EU markets through supply chains and export destination of goods; b) evidence of superior innovation, R&D and export performance from evidence of how business innovation and exporting varies across firms and over time in response to management practices and cultures. This will directly inform practical lessons for UK businesses. 4. Experimental analysis using big data We will use natural language processing and machine learning to investigate big data from job-search companies to objectively identify the factors that affect staff satisfaction and performance in the UK. Matching to the MES and other micro datasets we will examine links between mental health and management practices. 5. Randomised control trials Nearly 9,000 responding businesses in the MES sought 'feedback' on their management score. By varying feedback to respondents we will observe in collaboration with BIT (the 'Nudge Unit') and CMI the impact on firm's subsequent adaptation and performance.

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