The words “productivity” and “efficiency” are often used interchangeably in business strategy. But new studies have found that businesses and business leaders must adopt a “productivity” rather than “efficiency” mindset if they want to remain in the game, Michael Mankins argues in a piece for HBR. “Continuing to wring out greater profits through efficiency has become the managerial equivalent of attempting to squeeze blood from a stone,” he says. But what exactly is the difference? The article defines efficiency as “doing the same with less,” whereas productivity is defined as “doing more with the same,” which means that where the efficiency mindset would entail reducing manpower during periods of slow growth for example, a productivity mindset demands better utilization of existing resources to propel growth.

…and why does productivity now have more weight? A good look at the S&P 500 sees earnings growth running “nearly three times the rate of inflation over” the 1990s and 2000s but beginning to slow as of the end of 3Q2015, suggesting that “today’s business environment requires a different worldview.” HBR and the Economist Intelligence Unit’s interviews with 300 senior executives from around the world complemented the findings of a comprehensive Bain & Company study into workforce productivity, which found that there are ways to “unleash” a company’s productive power by limiting what is known as “organizational drag.” In other words, removing the obstacles in the way of productivity that consume valuable time and over time “limit employees’ ability to innovate and do deep work,“ according to Divinge. Those include slow and lengthy decision making processes, drained or unenthused employees that could be toxic to others, constant interruptions during the work day, and meetings that tend to run longer than they should, to name but a few. HBR’s studies found that a company loses an average 20% of its productive capacity each week — which translates into more than a whole day out of the five-day workweek.

“Most employees want to be productive, but the organization too often gets in their way” and talented employees are too often placed in roles that limit their effectiveness, suggesting that caution must be taken to employ your “star players” where they can really make an impact. That alone isn’t enough though. “Virtually every employee can bring more to their job, but many don’t invest the additional ingenuity and creativity that they could” because they are uninspired, even though an inspired employee is 125% more productive than one who is just satisfied. The best companies, according to HBR, are over 40% more productive than others and the difference is in their adherence to those “fundamental tenets.”