A mere 6% of Canadian SMEs use formal comprehensive metrics to measure and benchmark their productivity
MONTREAL, Oct. 17, 2016 /CNW Telbec/ - The Business Development Bank of Canada (BDC today launched a free and easy-to-use online benchmarking tool to support businesses looking to improve their productivity and scale up operations. The tool, which is the world's most comprehensive productivity benchmarking instrument, is available at BDC.ca and was developed in collaboration with Statistics Canada.
In just a few minutes, entrepreneurs can compare themselves for the first time to industry peers in Canada and identify new areas to improve their productivity. Companies will be able to benchmark their productivity performance against five key indicators: overall efficiency level, revenue per employee, profit per employee, productivity of labour and productivity of capital.
The tool's launch follows a new BDC study that found just 6% of Canadian entrepreneurs comprehensively measure their productivity and benchmark against competitors—vital first steps to optimizing performance and improving competitiveness at national and international level.
"We are excited to premier this leading-edge tool during BDC Small Business WeekTM and empower Canadian entrepreneurs to benchmark themselves for the first time against their industry, direct competitors and partners," says Pierre Cléroux, BDC's Vice President, Research and Chief Economist. "Business competition is fiercer than ever and we believe our productivity benchmarking tool will incite entrepreneurs to take action."
According to the findings of the new BDC study, which surveyed more than 1,500 Canadian small and medium-sized enterprises (SMEs) in July, eight in 10 entrepreneurs believe it's important to measure and benchmark productivity. Yet, less than half (46%) formally measure their productivity.
"Measuring productivity and comparing your performance levels to those of your industry peers is critical for boosting efficiency and profitability," Cléroux says.
"Small business owners put all their energy and resources into growing their companies, and BDC wants to make sure they have the resources they need to succeed," said the Honourable Bardish Chagger, Minister of Small Business and Tourism. "Through collaboration, BDC and Statistics Canada have created an important tool for our country's entrepreneurs. This is another great example of what we can achieve by working together."
BDC's study also found:
- SMEs that measure their productivity against formal metrics expect faster growth. One in three entrepreneurs who expect 10%-plus annual growth over three years comprehensively measure their productivity.
- Canada is far less productive today than 35 years ago, when compared to the U.S. For example, the GDP per hour of Canadian companies is 73% of that of U.S. companies. This figure is significantly down from over 90% levels experienced in the 1980s.
- Canadian SMEs are relatively less productive than their U.S. counterparts. Small and medium-sized firms productivity in Canada is 47% that of large businesses active in our country. In the U.S., stats show that small and medium-sized firms productivity is 67% that of large businesses.
- Canadian businesses invest just over half (56%) of the amount of U.S. companies in information and communications technology (ICT).
- Entrepreneurs identify employee training as their leading strategy for improving productivity, followed in order by: reduction of waste, better operations management, new products or services development, and investments in ICT.
BDC already offers a wide range of financial and advisory services to entrepreneurs looking to increase their productivity. Free resources include an eBook on how to create a leaner, more profitable business and an operational efficiency webinar. A second webinar on productivity practices is scheduled to air on November 22.
BDC is the only bank devoted exclusively to entrepreneurs. It promotes Canadian entrepreneurship with a focus on small and medium-sized businesses. With its 110+ business centres from coast to coast, BDC provides businesses in all industries with financing and advisory services. Its investment arm, BDC Capital, offers equity, venture capital and flexible growth and transition capital solutions. To find out more, visit bdc.ca.
About BDC Small Business WeekTM
BDC Small Business WeekTM is a Business Development Bank of Canada (BDC) trademark whose origins date back to 1979 when BDC business centres in British Columbia's Lower Fraser Valley pooled their resources to organize a week of activities for entrepreneurs. This first event and the one that followed in 1980 were so successful that BDC officially launched BDC Small Business WeekTM across Canada in 1981. The initiative was quickly adopted by Canada's business community. In 2015, close to 300 activities across Canada attracted around 10,000 business people to BDC Small Business WeekTM. This BDC flagship event celebrates entrepreneurship at the local, provincial and national levels.
SOURCE Business Development Bank of Canada
Video with caption: "Video: New BDC benchmarking tool aims to give businesses a productivity boost". Video available at: https://youtu.be/r3Ontl8_53s
For further information: Maria Constantinescu, Senior Advisor, Media Relations, BDC, [email protected], (514) 518-1577