How Collaboration and AI are Boosting Business Productivity

As 2024 nears its end, a clear shift in priorities is emerging: performance and productivity is no longer a top-four focus. Instead, according to our State of Employee Engagement 2024/25 research, performance and productivity as an HR priority has dropped from 4^th place to 7^th place. But don’t be mistaken–this isn’t a sign that productivity is being neglected. Rather, it reflects a broader movement towards employee well-being and enhancing the overall employee experience, which has now taken the top spots.

But can organizations afford to take their foot off the gas when it comes to productivity? The reality is that while well-being takes centre stage, productivity still, and always will, remain a vital concern that no organization can ignore. The key challenge lies in finding a balance that fosters both.

Key Points:

• Adapting to Changing Conditions is Crucial: Economic recovery and AI integration are reshaping productivity strategies.
• Collaboration is Key: Cross-functional teamwork is emerging as a critical driver to improve productivity.

Productivity: Challenges and Opportunities

While both the UK and the US have faced historical productivity challenges, recent trends show some promise. In the UK, productivity growth notably slowed between 1974 and 2008, with little improvement since​. The US has experienced similar issues, with the US Bureau of Labor Statistics revealing that labour productivity growth shrank to 1.3% annually between 2005 and 2018, down from a peak of 3.3% in the early 2000s​.

Despite these setbacks, our research offers hope. 45% of HR professionals have reported improvements in performance and productivity over the last year, a major leap from just 18% in 2023. These gains are likely driven by two factors: improving economic conditions and the rapid integration of AI technologies. In fact, AWS reports that AI adoption has increased by 31% from 2022 to 2023 in the UK alone, streamlining tasks and making work processes more efficient than ever before.

Is Collaboration the Secret Weapon to Boost Productivity?

Additionally, our State of Employee Engagement 2024/25 research shows that collaboration between teams and departments is increasingly being recognized as a critical driver of productivity. Fostering cross-functional communication and promoting interdepartmental projects can unlock hidden potential, enhancing team dynamics which leads to greater organizational performance.

And it’s no surprise—research by Gallup indicates that organizations with highly engaged workforces are 21% more profitable and 17% more productive compared to those with disengaged teams. When employees feel connected and supported by one another, they are not only more productive but also contribute significantly to the overall profitability of the business. Engaging employees through collaboration truly is the ultimate win-win.

For deeper insights into the shifting dynamics of performance and productivity, explore our latest findings in our full report, The State of Employee Engagement 2024/25.