Article at a glance:

How good management raises productivity

Competition tends to boost productivity in an economic sector. Does good management help, too? A new McKinsey study finds that it does. Managers who employ high-caliber people, reward performance, and minimize waste also raise productivity, especially in competitive environments.

The take-away

Companies often lobby for tax breaks on capital investments to boost productivity, but better management would achieve the same results at no cost to governments.