In 2025, efficiency is not just an operational concern—it is the top agenda item in boardrooms worldwide. A Porsche Consulting leadership survey confirms this: Efficiency-related priorities now dominate corporate strategy discussions. The most frequently cited imperatives—digitalization, process optimization, cost reduction, and artificial intelligence—all converge on a single objective: doing more with less, and doing it smarter.
This focus is not just timely—it is essential. Many companies are falling short of their financial targets, and major strategic initiatives are stalling in execution. Meanwhile, intensifying global competition and persistent geopolitical uncertainties are making revenue growth less predictable. In this environment, efficiency is not an option—it is crucial to sustained profitability and strategic agility.
Despite decades of technological advancement, efficiency levels across industries have been declining. A look at value added per employee—a key efficiency metric—highlights this downward trend. In Germany, labor productivity growth has decelerated from over 2 percent annually in the 1990s to just 0.6 percent in recent years. Across the U.S. and Europe, corporate efficiency gains remain concentrated in factory automation and operational process improvements, while productivity in white-collar roles has stagnated or even declined.
The challenge is not that companies have failed to pursue efficiency. Rather, their efforts have been uneven. While manufacturing and logistics have seen measurable improvements, corporate functions, service roles, and knowledge-intensive work—where a growing share of economic value is created—continue to operate in suboptimal ways. Why do companies struggle to achieve broad-based efficiency improvements? The answer lies in five deeply embedded barriers that persist across industries.
Read the whole article: The Efficiency Gap.
