BrazilStrategy&’s Potential Productivity Index redefines how national productivity is measured
Global strategy consulting firm Strategy& has teamed up with the World Governments Summit to launch the Productivity Potential Index (PPI), which according to its brainchilds offers countries a groundbreaking new way to manage their strategic planning around sustainable growth.
Productivity has long been the engine of modern economies, influencing global competitiveness, quality of life, and long-term prosperity. Yet traditional measures often fall short, failing to capture the complexity of 21st-century challenges like climate change, biodiversity loss, social transformation, and aging populations.
“Many productivity models also focus on the past, analyzing historic performance rather than identifying future opportunities,” said Dima Sayess, partner at Strategy& and one of the conceptors of the Index.
To meet demands of the new era, Strategy& – with support from the World Governments Summit – set out to expand traditional metrics with the likes of human capital, physical capital, social capital, and natural capital, and factor in an approach that complements fact-based productivity with ‘softer’ measures of advancement.
“The Productivity Potential Index really redefines how productivity is measured, integrating dimensions critical for our age such as environmental sustainability, wellbeing, innovation, and institutional quality,” Sayess explained.
The Index currently has populated baselines for 60 countries, including the world’s largest economies, emerging markets, and several countries in the Middle East. The Index, which is led by Strategy&’s team in the Middle East, will be used by the firm’s consultants around the globe to provide counsel to government leaders and policy makers.
“The Productivity Potential Index offers policymakers critical insights and a practical tool to identify and focus on the areas with the greatest potential to boost productivity, and subsequently their economic growth,” said Chadi Moujaes, partner at Strategy&.
Sayess added: “Our analysis shows that non-traditional measures of productivity are shaping the direction of change regionally and globally. Social trust, the quality of institutions and environmental indicators all play a role in driving, or hindering, economic growth. Understanding these mechanisms can enable policymakers to develop effective and targeted solutions.”
The $87 trillion opportunity
In a statement accompanying the launch of the Productivity Potential Index, Strategy& said that one of the key insights of its report is that the 60 countries assessed could unlock $87 trillion in productivity gains if they put in place the right policies, strategies and roadmaps.
To help leaders identify these opportunities, the Productivity Potential Index pinpoints strengths and weaknesses by country, and offers actionable pathways that can help countries “close gaps, leapfrog performance, and reach the levels of the world’s most productive economies.”
