Does having hourly employees stunt innovation?
It's an interesting question. One that admittedly, I have done no quantitative research into (yet!). But this stems from a conversation I recently got into with my husband.
He works in health care as an Occupational Therapist at the hospital. So he is an hourly employee, and his hours are very much measured by productivity (i.e. billable hours). He has to maintain a minimum level of productivity (85%). Which doesn't leave a lot of "extra" time (and in fact, his job is at risk if his productivity drops below the minimum, which is not uncommon in healthcare). Recently however he was injured (not at work, but while he was mountain biking), which prevented him from working with patients.
Fortunately, he could still do some "light duty" things at work such as training his replacement, updating some of their online documentation, and doing some cross training with another department. All of this was considered "non-billable/non-productive" time. But what was remarkable were all the ideas my husband came home talking about with ways to improve certain processes. Once he had the space to spend some "non-billable" time with things, he could step back from being just a worker bee, and think about ways to innovate at the company - especially being someone who is closest to the issues. And now some of these improvements are being implemented.
Now, this isn't the first time he's come home with great ideas for how to improve processes and workflow at the hospital. However in the past, when he's mentioned an idea to me, and I ask "did you bring that up with your boss?". The response has always been: "Well I can't because it will affect my productivity," or, "If I do it, it has to be off the clock". So his employer is missing out on great innovations that are never brought to the table because it's something the employees won't get paid for.
Productivity measurements are not exclusive to healthcare. A lot of companies and industries track their employees' time, and measure it against billable hours. But the moral of the story here is: what would it actually look like for a company's bottom line if they lowered this "productivity standard" to allow for innovation to happen? My hunch (and again, without data and research to back this hypothesis up) is that, by lowering productivity requirements and allowing for more "un-billable" time, thereby allowing employees to have the ability to affect change (without risking it affecting their jobs) - especially if these changes lead to more efficiencies (i.e. higher productivity), or higher client satisfaction, or overall higher employee satisfaction (i.e. higher retention/less turnover) - companies will actually see a higher positive effect on their overall bottom line.
Now I'm not suggesting to make everyone a salary employee (it is just not feasible in many industries - healthcare included) but rather to open up opportunities for innovation among an hourly workforce. Set aside time for creativity, brainstorming, and exploration of ideas, and I'm sure the gains will be worth the "un-billable hours".