hr industry benchmark survey 2020

ELMO SOFTWARE | 2021 | Unclassified Public 11

inpartnership

with

HR Industry BenchmarkSurvey 2020:

Australia and New Zealand

Your 2021 Report

ELMO SOFTWARE | 2021 | Unclassified Public 2Monica Watt | ELMO CLOUD HR & PAYROLL | 2018 2

Foreword

ELMO SOFTWARE | 2021 | Unclassified Public

Welcome to ELMO’s second annual “HR Industry Benchmark Survey” Report, conducted in partnership with the Australian Human Resources Institute (AHRI).

When our survey was conducted in September 2020, the world was in the grip of COVID-19. The pandemic has fundamentally changed how organisations operate, perhaps forever. This report offers a rare opportunity to view, compare and contrast data sets from the past two years of data – one from a time before COVID-19, and one since the COVID-19 pandemic was first thrust upon the world.

ELMO has consulted with a range of subject matter experts to examine what the results mean and why they tell the story they do. Herein, we not only provide the results and insights, but provide some handy tips to bridge the gap between theory and practice that organisations can apply in their own environments.

Moreover, in the individual sections of the Appendix covering the respective HR functional areas, we have divided our commentary into the following 3 core distinctions:

Summary | Insight | Action

The results and insights from this report will help establish benchmarks in this “new world of work” using a wide range of qualitative and quantitative data. In this new, uncharted era, such insights are more valuable than ever before.

Happy benchmarking!

02

inpartnership

with


Table of contents


PART 1: Insights summaries

• Introduction and respondent profiles Page 04

• The general state of HR Page 08

PART 2: Full benchmark data

• Appendix A: Respondent profile data Page 62

• Appendix B: The general state of HR Page 69

• Appendix C: Recruitment Page 119

• Appendix D: Onboarding Page 149

• Appendix E: Performance management Page 175

• Appendix F: Succession management Page 198

• Appendix G: Learning & development (L&D) Page 216

• Appendix H: Rewards & recognition (R&R) Page 240

• Appendix I: Remuneration & benefits Page 262

Appendix J: Payroll Page 279

• Appendix K: Rostering / time & attendance 09


Introduction andrespondent profiles



Respondent profiles and sample sizes


n = 1920+

# Refer to next page^ Refer to next page

05

85%

15%

Country

Australia New Zealand

24%28% 26%

19%

3%

Leadership /

C-level

Senior

management

Mid-level

management

Junior to mid-

level (individual

contributor)

Other

Level of seniority

53%34%

14%

Organisation Size

SMB (1 - 199)

Mid-Market (200 - 1999)

Enterprise (2000 +)

We would like to thank all HR & payroll professionals who participated in the 2020 HR Industry Benchmark Survey. Their participation has enabled us to provide comprehensive Australian and New Zealand (A / NZ) HR industry benchmark data that can be broken down into segments such as country, organisation size, seniority level and industry# (referred to in this report as data segments).

In total, over 1800 respondents started the survey and at least completed the first section of questions, with nearly 800 respondents having completed the survey in its entirety. All data captured has been used for the analysis to provide as large a sample size as possible. Questions at the start of the survey have higher numbers of respondents than questions towards the end of the survey due to survey respondent drop-off rates.

Any references to industry segments in this report align with Australian and New Zealand Standard Industry Classification (ANZSIC) codes. Almost every question in this report has been broken down by country, organisation size, industry# and respondent seniority level.

Sample sizes^ per question and data segment are provided for every data point in both Part 1 and Part 2 of this report, denoted by n =. Where the number of respondents varied mid-way through a section of questions, the sample size has been provided for the question with the fewest completions, alongside a plus sign to indicate that some questions may have had a larger sample size. For example, if 765 people completed the first question in a given section but only 745 people completed the last question in that section, the sample size has been given as n = 745+.

In this report, organisations have been rolled up into three high-level categories:

1. Small and medium businesses (SMBs): 1-199 employees

2. Mid-market organisations: 200-1999 employees

3. Enterprise organisations: 2000+ employees


Industry codes and sample sizes


n = 1920+

06

17%10%

10%9%

7%7%

6%6%

5%4%

3%3%3%

2%2%2%2%2%1%

0.5%

Professional, Scientific And Technical Services

Health Care And Social Assistance

Not-For-Profit

Financial And Insurance Services

Education And Training

Public Administration And Safety

Information Media And Telecommunications

Manufacturing

Construction

Retail Trade

Transport, Postal And Warehousing

Accommodation And Food Services

Electricity, Gas, Water And Waste Services

Administrative And Support Services

Agriculture, Forestry And Fishing

Wholesale Trade

Mining

Rental, Hiring And Real Estate Services

Arts And Recreation Services

Other

Industry types (as per the ANZSIC industry list)While industry data has been collected and segmented for each question during our analysis, industry level information is only called out in the event of a clear pattern or trend that is of interest for a given question.

The general rule is that, in order for responses to have statistical significance, they should have a minimum sample size of 30 respondents. Having said that, inferences can still be made from any data points that have less than 30 respondents and we have therefore left the data points with less than 30 responses visible in the report for your perusal. It is only a small subset of the industry-segmented data that will have less than 30 respondents for specific questions.


Respondent involvement in specific HR areas

In the first section of the survey, all respondents were asked to select the areas of HR they are ‘responsible for’ or ‘actively involved’ in. If they were not ‘responsible for’ or ‘actively involved’ in a specific area, they were not asked the questions relating to this area. Apart from payroll and rostering / time & attendance, which can often fall under the remit of finance teams, all other areas of HR had at least 70% of respondents indicating they were ‘responsible for’ or ‘actively involved’ in the respective area.

C-suite leaders are the most likely to have responsibility for every area of HR, apart from rostering / time & attendance and payroll. More responsibility is sometimes given to junior or mid-level HR staff for tasks relating to onboarding and recruitment.


42%

39%

41%

39%

49%

43%

47%

45%

34%

36%

32%

33%

29%

29%

22%

16%

48%

49%

45%

45%

35%

38%

33%

33%

43%

42%

41%

39%

42%

41%

30%

30%

10%

12%

15%

16%

17%

18%

20%

22%

23%

23%

27%

28%

29%

31%

48%

54%

Employee engagement

Organisational culture

Employee wellness

Learning & development

Onboarding

Performance management

Recruitment

Industrial / employee relations

Diversity & inclusion

Rewards & recognition

Workplace health & safety (WHS)

Remuneration / compensation & benefits

Organisational design

Succession management

Payroll

Rostering / time & attendance

Which of the following area(s) are you responsible for or actively

involved in?

Responsible for Actively Involved Not Involved


The general state of HR



Workforce decrease vs increase

The percentage of respondents who expected their workforce to grow in the next 12 months declined since the 2019 survey. Given the impact of COVID-19 and the economic downturn, this general decline in hiring sentiment was not surprising and reflected a drop in overall market and consumer confidence.

However, considering the amount of media hype and speculation about a drastic looming recession and mass workforce culling at the time of the survey (September 2020), these projections were actually rather positive. Roughly half (46%) of respondents thought the size of their workforce would remain the same for the next 12 months. Out of the remaining half, twice as many respondents believed their workforce would grow rather than shrink. In addition, almost every industry surveyed had significantly more respondents who believed their workforce would increase rather than decrease (see the next page for these results in more detail).

Enterprise organisations and respondents from ‘education and training’ and ‘electricity, gas, water and waste services’ were the only sectors where the percentage of respondents anticipating a workforce decrease slightly outweighed the percentage anticipating a workforce increase.

On the whole, it’s apparent that even during the height of the pandemic, most employers in Australia and New Zealand were optimistic that they would weather the storm or continue to grow.


Over the next year, do you anticipate the size of your workforce to:

6%11% 7%

15% 12%

29%

7%15%

38%

45%

41%

48%44%

45%

40%

46%

56%

44%52%

37%44%

26%

52%

39%

2019 2020 2019 2020 2019 2020 2019 2020

n = 633 n = 1016 n = 618 n = 651 n = 259 n = 261 n = 1510 n = 1928

Decrease in size Remain the same Increase in size

SMB (1 - 199)

Mid-market (200 - 1999)

Enterprise (2000 +)

Overall


Workforce decrease vs increase per industry


n = Industry*Net workforce

increase(increase – decrease)

59 Accommodation and food services 17%45 Administrative and Support Services 18%34 Agriculture, forestry and fishing 24%27 Arts and Recreation Services 0%88 Construction 9%

134 Education and training -1%59 Electricity, gas, water and waste services -5%

164 Financial and insurance services 21%202 Health care and social assistance 50%118 Information media and telecommunications 30%117 Manufacturing 27%32 Mining 13%

330 Professional, scientific and technical services 28%126 Public administration and safety 20%29 Rental, Hiring and Real Estate Services 24%71 Retail trade 23%64 Transport, postal and warehousing 27%33 Wholesale trade 9%

187 Not for profit 37%9 Other 44%

25%

16%

9%

26%

24%

28%

24%

16%

7%

19%

12%

22%

12%

10%

14%

17%

19%

12%

7%

32%

51%

59%

48%

43%

46%

58%

46%

37%

33%

49%

44%

48%

61%

48%

44%

36%

67%

49%

56%

42%

33%

32%

26%

33%

26%

19%

37%

56%

48%

39%

34%

40%

29%

38%

39%

45%

21%

44%

44%



* This is calculated by subtracting the % of respondents who anticipated their workforce decreasing in size from the % of respondents who anticipated an increase in the size of their workforce. This question was answered by all survey respondents. Rounded whole numbers can cause what appears to be a -1% or +1% discrepancy.


Workforce growth rates per industry

* This is calculated by subtracting the % of respondents who anticipated a decrease in the size of their workforce from the % of respondents who anticipated an increase in the size of their workforce. This question was answered by all survey respondents. Rounded whole numbers can cause what appears to be a -1% or +1% discrepancy. (See the previous pages for a more detailed view of the data and how this is calculated).

** This question was only answered by respondents who intended to expand their workforce over the next 12 months, hence why there is a much smaller number of respondents per industry.

Overall, these results suggest that Australia and New Zealand will see a net workforce increase of 24% over the next 12 months, with an average workforce growth rate of 19%.

The 3 industries (based on a large enough sample size) expecting to expand their workforce the most in 2021 are:

1. Health care and social assistance: shows a 50% net workforce increase and an average headcount growth rate of 19%.

2. Not for profit: shows a 37% net workforce increase and an average headcount growth rate of 14%.

3. Information media and telecommunications: shows a 30% net workforce increase and an average headcount growth rate of 23%.


Industry ^n=*Net

workforce increase

n=**Average % headcount

growth planned

Accommodation and food services 59 17% 25 14%

Administrative and support services 45 18% 15 28%

Agriculture, forestry and fishing 34 24% 11 12%

Arts and recreation services 27 0% 6 35%

Construction 88 9% 25 19%

Education and training 134 -1% 35 22%

Electricity, gas, water and waste services 59 -5% 11 10%

Financial and insurance services 164 21% 61 21%

Health care and social assistance 202 50% 108 19%

Information media and telecommunications 118 30% 56 23%

Manufacturing 117 27% 45 14%

Mining 32 13% 11 21%

Professional, scientific and technical services 330 28% 132 19%

Public administration and safety 126 20% 36 25%

Rental, hiring and real estate services 29 24% 11 14%

Retail trade 71 23% 27 21%

Transport, postal and warehousing 64 27% 29 23%

Wholesale trade 33 9% 7 8%

Not for profit 187 37% 82 14%

Other 9 44% 4 30%

Average overall growth rate 1928 24% 737 19%

^ The general rule is that, in order for responses to have statistical significance, they should have a minimum sample size of 30 respondents. Having said that, inferences can still be made from any data points that have less than 30 respondents and we have therefore left the data points with less than 30 responses visible in the report for your perusal. It is only a small subset of the industry-segmented data that will have less than 30 respondents for specific questions.


Projected workforce growth rates

As shown by the data on the previous two pages, more organisations planned to increase than decrease their workforce over the coming 12 months. The data on this page focuses on the average headcount growth rates. Please note that this question was only asked of respondents who indicated that their organisation intended to grow its workforce.

While the projected headcount growth rates reduced across all types of organisation, enterprise organisations were the least optimistic, with those expecting to increase headcount dropping from 31% in 2019 to 13% in 2020.

In many ways, COVID-19 presented an opportunity for organisations to take stock of their current workforce and available skill sets, and reconsider how best to use internal resources in a more efficient and cost-effective way, rather than increasing the size of their workforces. Research from McKinsey indicates that adapting employees’ skills and roles to the post-pandemic way of working will be critical to building resilient business models.

ELMO’s own Chief Human Resources Officer, Monica Watt, commented: “We have moved from outputs to outcomes, assessing what we can achieve with what we’ve got.”

It’s likely that, during 2021, some organisations will return employees to their workforces who were furloughed or stood down in 2020. Others may have hired people on a contract and / or casual basis until conditions allow for full-time equivalent (FTE) increases.


The average headcount growth

rates cited in this table are only

based on respondents who said

their organisation intends to grow

the size of their workforce.

SMB

(1-199)

Mid-market

(200-1999)

Enterprise

(2000+)

Overall

average

2019 2020 2019 2020 2019 2020 2019 2020

Average % headcount growth

planned33% 21% 21% 17% 31% 13% 28% 19%

n = 356 440 323 235 113 62 792 737

https://www.mckinsey.com/business-functions/organization/our-insights/to-emerge-stronger-from-the-covid-19-crisis-companies-should-start-reskilling-their-workforces-now


The time and cost of managing people

● On average, it takes 33.4 days to fill a vacant position. Australian organisations typically fill vacant roles within an average of 33 days. The time taken to fill roles is slightly longer in New Zealand, at an average of 36.5 days.

● The average cost to hire a new employee is ~$10,500 and is over twice as much for C-level executives.

● The majority of the time that HR spends onboarding new employees is dedicated to ‘conducting role-specific training’. This takes an average of 7 hours per week.

● On average, managers spend 76 hours per year conducting performance appraisals (either ad hoc or formal), compared to 67 hours invested by employees and 39 hours by HR team members.

● For payroll, ‘gathering required data’ and ‘payroll calculation’ are the tasks that take up the most time, requiring an average of 7 hours and 6 hours per month respectively.

● On average, employees spend 7 days per year undertaking formal training. This has an average annual cost of ~$6,600 per employee. Mid-market organisations spend the most money on learning, at ~$8,700 annually per employee (enterprise organisations spend ~$8,200 and SMBs ~$5,400).


33.4 days

It takes 33.4 days to fill a vacant position

$10,500

It costs $10,500 to fill a vacant position

7 hours per week

The majority of the time that HR spends onboarding new employees is dedicated

to ‘conducting role-specific training’,at 7 hours

76 hours per year

Managers spend 76 hours per year conducting performance appraisals,

compared to 67 hours per year investedby employees

7 hours per month

For payroll, the task that takes up themost time is gathering required data,

which takes 7 hours per month

$6,600 per year

Employees spend 7 days per year undertaking formal training, at an

average cost of $6,600

Respondent data confirmed that on average:


Turnover rates

The overall A / NZ employee turnover rate decreased from 17% in 2019 to 15% in 2020. A possible reason for this result is that voluntary turnover (whereby an employee willingly chooses to leave their job) decreased because people were opting to hold onto the security of their current job rather than risk moving to a new job, where they would be more vulnerable to job cuts.

In Australia, concerns about finding a new job were amplified by the rise in unemployment across the country. In September 2020, when this survey was conducted, the Australian unemployment rate was 6.9%. This September 2020 figure was 1.7% higher than September 2019 and is the equivalent of nearly one million people out of work.

Interestingly, the average employee turnover rate in New Zealand decreased to 14%, even though the NZ unemployment rate barely changed and in fact slightly decreased from Sept 2019 (4.2%) to Sept 2020 (4.0%).

Another hypothesis about the decrease in employee turnover is that government wage subsidy schemes have worked. Such schemes meant that employees who were stood down or had their hours reduced were able to hold onto existing jobs while still being paid rather than scrambling to find new jobs. According to the rules of one scheme, Australia’s JobKeeper, if an employee resigned or terminated their employment after 1 July 2020, they were unable to receive JobKeeper payments from a new employer. It’s likely that many people stayed with their existing employer in order to access JobKeeper payments and other support.


Organisation size n= Average turnover rate 2019 n= Average turnover

rate 2020

Australia 868 17% 998 15%

New Zealand 118 17% 164 14%

SMB (1-199) 439 16% 589 14%

Mid-market (200-1999) 408 17% 444 16%

Enterprise (2000+) 139 17% 129 18%

Overall 986 17% 1162 15%

https://www.abs.gov.au/statistics/labour/employment-and-unemployment/labour-force-australia/latest-release

https://www.stats.govt.nz/indicators/unemployment-rate

https://www.aigroup.com.au/resourcecentre/hr/QA-HR/covid-19-jobkeeper-payment-scheme-frequently-asked-questions/


2020 turnover rates per industry


The decrease in employee turnover was fairly consistent across most industries. The only industries that reported an increase in turnover (with a large enough sample size in 2019 and 2020 to make a reasonable comparison) were ‘public administration and safety’, ‘financial and insurance services’, and ‘education and training’.

Although the survey question did not specify voluntary or involuntary turnover, given the uncertain conditions of 2020, it is surprising that the overall employee turnover figures were not higher. However, the true test may be yet to come as the economy improves, the job market rebounds and people opt to explore employment opportunities elsewhere. Indeed, research from Deloitte following the global financial crisis in 2009 showed that voluntary turnover tends to increase during periods of economic recovery. The research found that those organisations that look after their people well (or as well as they can) during a downturn, tend to fare better in the long-run in terms of employee retention.

While pay increases and bonuses may not be an option, employers should consider non-financial rewards, including cost-effective learning & development such as special projects or mentoring programs. Employers should also aim to optimise the employee experience (e.g. wellbeing initiatives and flexible work options). A total rewards strategy is one way to emphasise and promote everything an employer can offer an employee.

Industry

2019 2020% pt.

change since 2019

986 resp.

1162 resp.

Accommodation and food services 30% 27% -3%

Retail trade 25% 21% -4%

Administrative and Support Services 18% 17% -1%

Health care and social assistance 19% 17% -2%

Not-for-profit 19% 17% -2%

Information media and telecommunications 20% 16% -4%

Construction 18% 16% -2%

Financial and insurance services 14% 15% 1%

Arts and Recreation Services 15% 15% 0%

Education and training 12% 14% 2%

Professional, scientific and technical services 14% 14% 0%

Mining 11% 14% 3%

Transport, postal and warehousing 16% 13% -3%

Public administration and safety 11% 13% 2%

Manufacturing 13% 13% 0%

Electricity, gas, water and waste services 11% 13% 2%

Rental, Hiring and Real Estate Services 27% 12% -15%

Wholesale trade 15% 10% -5%

Agriculture, forestry and fishing 16% 8% -8%

A/NZ Overall 17% 15% -2%

Highest value

Saturation map scale:Lowest value

https://www2.deloitte.com/us/en/insights/deloitte-review/issue-5/where-did-our-employees-go.html

https://elmosoftware.com.au/resources/ebooks-guides/whitepaper-developing-a-total-rewards-strategy-post-covid-19/


2020 turnover rates for new hires


55%45%

Provided a new hire turnover rate

Didn't know the answer to the question

n = 813

n = SegmentNew hire turnover

rate within probation period

%pt. change from 2019

393 Australia 7% 0%

50 New Zealand 6% 1%302 SMB 5% -1%119 Mid-market 9% 0%22 Enterprise 13% 4%

15 Accommodation and food services 9% -1%

6 Administrative and support services 4% -1%

12 Agriculture, forestry and fishing 6% -10%

8 Arts and recreation services 5% 0%

22 Construction 6% -1%

35 Education and training 6% 0%

10 Electricity, gas, water and waste services 7% -2%

38 Financial and insurance services 9% 3%

41 Health care and social assistance 7% -2%

29 Information media and telecommunications 7% -3%

30 Manufacturing 7% -6%

7 Mining 7% -1%

49 Not for profit 6% -2%

1 Other 0% -1%

82 Professional, scientific and technical services 4% 0%

17 Public administration and safety 3% 0%

8 Rental, hiring and real estate services 13% -1%

11 Retail trade 7% -1%

14 Transport, postal and warehousing 10% 8%

8 Wholesale trade 8% -3%

Average new hire turnover rates within probation period:

The survey asked a question about turnover rates for new starters within their probation period. Despite the unsettled business conditions in 2020, the results were similar to the 2019 results. The average turnover rate for new hires in Australia was 7% (the same as for 2019), and 6% in New Zealand (up from 5% in 2019). The 2020 results mirrored the 2019 results for mid-market organisations (9%), while enterprise organisations saw an increase from 9% in 2019 to 13% in 2020. Conversely, SMBs saw a decline from 6% in 2019 to 5% in 2020.

Certain industries fared better than others in 2020, with reductions in new hire turnover rates. Among the best performing were ‘agriculture, forestry and fishing’, ‘manufacturing’, ‘information, media and telecommunications’, and ‘wholesale trade’. Other industries struggled. Among those that saw an increase in new hire turnover were ‘transport, postal and warehousing’ and ‘financial and insurance services’.

Alarmingly, over a quarter (27%) of respondents who are ‘responsible for’ or ‘actively involved in’ recruitment responded that they did not know the answer to this question. Even more interestingly, 36% of C-suite leaders and 38% of senior management respondents also indicated they did not know the answer to this question.


Top 3

Top challenges for the next 12 months


26%

26%

23%

22%

22%

20%

20%

19%

17%

16%

16%

13%

13%

12%

12%

11%

6%

3%

2%

26%

37%

N/A

34%

30%

30%

28%

23%

N/A

19%

16%

16%

N/A

N/A

18%

16%

6%

N/A

3%

Upskilling, cross-skilling or reskilling employees

Leadership development

Increase in remote working

Cultural change

Change management

Upgrading technology

Lack of resources

Automating administrative tasks

Employee wellness

Low employee engagement

Boosting productivity

Succession planning

Recruitment


Rapid growth

High employee turnover


Offboarding / standing down

Other

Please select the top three items that you believe will challenge your organisation over the next 12 months:

2020 (n = 1240)

2019 (n = 1043)

ELMO SOFTWARE | 2021 | Unclassified Public 18ELMO SOFTWARE | 2021 | Unclassified Public 18


The anticipated challenges facing business leaders in 2021 was quite different to those identified in our 2019 survey. Many of these changes were linked to the impact of COVID-19, such as the decline in challenges associated with rapid growth and high employee turnover, both of which were somewhat stunted during the economic downturn.

Of particular note is the fact that two learning & development-focused challenges dominate: the upskilling / cross-skilling or reskilling of employees; and leadership development, which ranked as the top challenge back in 2019. It’s possible that employers at the time the survey was conducted (September 2020) were forecasting ahead to the rebuilding / recovery phase following the uncertainty of 2020. In order to do this, there will be a strong need to focus on employee skills.

It’s also worth noting that challenges related to cultural change, change management, the upgrading of technology and a lack of resources all declined, possibly due to many organisations switching focus from long-term strategy to functional, ‘day-to-day’ issues. In addition, in many cases, dealing with change became part of every worker’s life for most of 2020.

There were only subtle differences in the top anticipated challenges based on organisation size. Enterprise organisations expected to be slightly more challenged than their smaller counterparts by issues such as diversity and inclusion, employee wellness, remote working, a lack of resources and high employee turnover. Mid-market organisations and SMBs expected more challenges relating to rapid growth, performance management and leadership development. SMBs also anticipated challenges relating to productivity.

By industry, several key trends stood out:

➢ Leadership development challenges were more prevalent in the ‘health care & social assistance’ and ‘manufacturing’ industries, having been cited by 1 in 2 respondents working in these industries

➢ Upskilling, cross-skilling and reskilling employees was the top challenge for respondents from the ‘information media and telecommunications’, ‘construction’ and ‘manufacturing’ industries

➢ Change management was the top challenge for the ‘administrative and support services’ and ‘arts and recreation services’ industries➢ The increase in remote working was particularly challenging for respondents from the ‘wholesale trade’ industry, with 1 in 2

respondents having selected this, followed by the ‘agriculture, forestry and fishing sector’, with just over 1 in 3 respondents having selected this as a challenge1 in 5 respondents said upgrading

technology was a top challenge

1 in 2 respondents from the ‘healthcare and social assistance’ industry said leadership

development was a top challenge

1 in 4 respondents said up-skilling, cross-skilling or reskilling employees

was their top challenge


Top 3

Areas that take up too much of HR’s time

71%

30%

25%

24%

23%

23%

18%

16%

16%

11%

10%

10%

9%

8%

6%

74%

31%

27%

19%

33%

21%

21%

12%

23%

#N/A

7%

8%

7%

9%

#N/A

General admin work

Operations management


Workforce management (rostering / time & attendance)

Recruiting and executive search


Driving and managing organisational culture / behaviour

Meeting with senior leaders / business partners

Onboarding / induction


Other

Employee engagement

Learning & development (L&D)

Developing HR strategy

Employee wellness

Please select the top three areas that you believe to be taking up too much of HR's time in your

organisation, relative to the value they deliver:

2020 (n = 1251)

2019 (n = 1053)



Similar to 2019 results, ‘general admin work’ once again dominated responses to this question. This was consistently selected as the area that takes up too much of HR’s time, regardless of job role, company size or location. It’s an indication that, despite the time-saving benefits of automation, there’s still a long way to go until the paperwork associated with people management becomes lessonerous. It’s also possible that due to COVID-19 and heightened government rules and regulations, general administrative work increased for employers during 2020.

When compared to the 2019 results, far fewer respondents said they were spending their time undertaking ‘recruitment and executive search’ or ‘onboarding / induction’. Given the more subdued hiring levels seen in most industries throughout 2020, this was not surprising. It’s also worth noting the impact of technology on these areas. There has been an increase in fully implemented recruitment and onboarding technology (which increased by 17% and 16% respectively).

By streamlining manual processes, HR has more time to devote to other areas.

One of the biggest increases was seen in the amount of time spent meeting with senior leaders / business partners. Again, COVID-19 was likely responsible for this rise as HR and executive teams scrambled to roll out processes and strategies to keep their organisations operational. This was more of an issue for larger organisations: 1 in 4 respondents from enterprise organisations said meetings with senior leaders / business partners took up too much of HR’s time, compared to just 1 in 7 respondents from SMBs and mid-market organisations. This was the only significant difference in results between organisation sizes for this specific question.

‘Industrial / employee relations’ saw a slight increase in 2020. As mentioned elsewhere in this report, this may be attributed to more redundancies having to be made throughout 2020 and the need to navigate the complex industrial landscapes. For further information, download ELMO’s guide to HR compliance in Australia and New Zealand.

When analysed by job role, many senior managers and C-suite leaders selected ‘operations management’ as something taking up too much of HR’s time. In the earlier stages of the COVID-19 pandemic, HR was often responsible for providing strategic direction, but also for ensuring day-to-day operations continued. It also often fell to this cohort to train junior managers on how to manage remote or geographically dispersed workforces. Other areas that C-suite leaders felt took too much time for HR included industrial / employee relations and functional areas such as workforce management (rostering / time & attendance) and performance management.

3 in 4 respondents said ‘general admin’ took up too much of HR’s time

1 in 7 respondents from SMBs and mid-market organisations said ‘meetings with

senior leaders / business partners’ took up too much of HR’s time

https://elmosoftware.com.au/resources/ebooks-guides/hrs-duty-of-care-your-guide-to-workplace-compliance-australian-edition/

https://elmosoftware.com.au/resources/ebooks-guides/the-ultimate-guide-to-hr-compliance-new-zealand-edition/


The implementation of HR technology


69%

78%

65%

59%

54%

51%

53%

35%

41%

51%

46%

48%

39%

27%

21%

20%

9%

14%

17%

21%

23%

19%

32%

25%

15%

19%

16%

19%

23%

22%

2%

4%

7%

7%

9%

10%

11%

11%

11%

7%

11%

9%

11%

15%

16%

2%

2%

5%

4%

8%

5%

8%

9%

10%

6%

6%

8%

10%

12%

14%

4%

4%

7%

7%

5%

6%

7%

9%

8%

15%

14%

12%

14%

13%

17%

2%

4%

3%

5%

4%

4%

3%

5%

4%

7%

5%

7%

7%

9%

11%

Communication / collaboration platforms

Payroll

Recruitment


Core HR (e.g. employee data management, leave management)

Onboarding


Employee wellness programs

Learning management


HR surveys



Workforce planning


Which of the following stages best describes your organisation's current state

of HR & payroll technology?

Fully implemented Currently implementing Less than 12 months away More than 12 months away Not considering at all I don't know


The implementation of HR technology


The graph on the previous page shows how prominent communication / collaboration platforms have become, with 69% of respondents indicating this type of technology is fully implemented in their organisations and an additional 20% indicating that it’s currently being implemented. In terms of being fully implemented, this is second only to payroll. The rise of remote working is no doubt why this type of HR technology was in such high demand throughout 2020. At the height of the pandemic, research from AON indicated that communication was the biggest challenge facing HR leaders. Different research from Forrester showed that 63% of Australians admitted to being less productive at home, and only 54% believed their organisation had the technology and resources to enable effective remote working.

Another direct impact from COVID-19 was the uptake of employee wellness technology. In this graph, employee wellness shows the largest percentage of respondents who are ‘currently implementing’.

Current and future technology adoption is seen most prominently in recruitment, onboarding and core HR. Less prominent is succession management and workforce planning.

69%of respondents have

already fully implemented a communication /

collaboration platform

20%are currently

implementing a communication /

collaboration platform

78%of respondents have fully

implemented payroll technology

54%of Australians believe

their organisation had the technology and resources to enable effective remote

working

https://www.aon.com.au/getmedia/8da6b62e-a453-4a8f-8a1b-76cdefd07f0a/Australia-and-New-Zealand-Overall-Results-for-Aon-COVID-19-Workplace-and-Rewards-Pulse-Survey-April-03-2020-(2).pdf.aspx

https://go.forrester.com/blogs/how-australian-employees-feel-about-covid-19-forresters-pandemicex-survey/


HR technology implementation trends


Data from the 2019 survey that projected the level of technology implementation levels in 2020 proved to be overly optimistic. In reality, the actual levels of fully implemented technology in 2020 were significantly lower than the 2019 projection. However, there has still been a steady rise in the implementation of HR technology.

The projection of fully implemented technology in 2020 and 2021 is based on the combination of respondents:

• With fully implemented technology the year the survey was conducted

• Who were in the process of implementing their technology the year the survey was conducted

• Who said their technology was less than 12 months away the year the survey was conducted

2019 (Fully implemented)

2020 (Projection of fully implemented

from 2019)

2020 (Fully implemented)

Change from 2020 actual to 2020

projection

2021(Projection of fully implemented from

2020)

Payroll 73% 89% 78% -11% 90%Communication / collaboration platforms N/A N/A 69% - 92%Recruitment 48% 76% 65% -11% 86%Workplace health & safety (WHS) 41% 67% 59% -8% 84%Core HR (e.g. employee data and leave management)

49% 81% 54% -27% 84%

Performance management 37% 71% 53% -18% 82%Onboarding 35% 76% 51% -25% 84%Rostering / time & attendance 46% 67% 51% -16% 72%Remuneration / compensation & benefits 32% 58% 48% -10% 72%HR surveys 40% 71% 46% -25% 75%Learning management 32% 72% 41% -31% 78%Rewards & recognition 25% 57% 39% -18% 69%Employee wellness programs 26% 62% 35% -27% 77%Workforce planning 18% 50% 27% -23% 66%Succession management 15% 47% 21% -26% 59%

Highest value



% change in HR technology implementations

The table on the previous page showed that the uptake of various types of HR technology is steadily rising and is forecast to boom during 2021. This table presents the same data but also includes the ‘% point change’ and ‘% change’ in HR technology implementation levels.


2019 RESULTS 2020 RESULTS CHANGE IN METRICS

Ranked by the*% change in

implementationHR technology type

% fullyimplemented in

2019

Projected implementation in

2020(based on 2019 data)

% fullyimplemented in

2020

Projected implementation in

2021(based on 2020 data)

% point difference in fully implemented

technology between 2019 and 2020

% change in fully implemented

technology between 2019 and 2020

1 Rewards & recognition 25% 57% 39% 69% 14% 56%

2 Workforce planning 18% 50% 27% 66% 9% 50%

3 Remuneration / compensation & benefits 32% 58% 48% 72% 16% 50%

4 Onboarding 35% 76% 51% 84% 16% 46%

5 Workplace health & safety (WHS) 41% 67% 59% 84% 18% 44%

6 Performance management 37% 71% 53% 82% 16% 43%

7 Succession management 15% 47% 21% 59% 6% 40%

8 Recruitment 48% 76% 65% 86% 17% 35%

9 Employee wellness programs 26% 62% 35% 77% 9% 35%

10 Learning management 32% 72% 41% 78% 9% 28%

11 HR surveys 40% 71% 46% 75% 6% 15%

12 Rostering / time & attendance 46% 67% 51% 72% 5% 11%

13 Core HR (e.g. employee data and leave management) 49% 81% 54% 84% 5% 10%

14 Payroll 73% 89% 78% 90% 5% 7%


Key insights about the uptake of HR technology

The data on the preceding charts indicate that the uptake of various types of HR technology is rising rapidly and is forecast to boom next year. Overall, the top 5 largest increases in fully implemented technology relate to:

1. Workplace health & safety – an increase from 41% in 2019 to 59% in 2020

2. Recruitment – an increase from 48% in 2019 to 65% in 2020

3. Onboarding – an increase from 35% in 2019 to 51% in 2020

4. Remuneration / compensation & benefits – an increase from 32% in 2019 to 38% in 2020

5. Performance management – an increase from 37% in 2019 to 53% in 2020

Larger organisations are more likely to have fully implemented HR technology due to the complexities of managing large workforces. However, there are a number of HR technology types where the implementation levels across SMBs are almost comparable to implementation levels for larger organisations. For example, work health & safety, payroll, core HR and onboarding.


n = 1570 844 533 192

% of respondents who have HR technology fully implemented:

OverallSMB Mid-market Enterprise

(1 - 199) (200 - 1999) (2000+)

Communication / collaboration platforms 69% 64% 77% 71%

Core HR (e.g. employee data management, leave management) 54% 52% 56% 59%

Employee wellness programs 35% 30% 36% 52%

HR surveys 46% 36% 57% 55%

Learning management 41% 32% 46% 67%

Onboarding 51% 49% 54% 56%

Payroll 78% 76% 80% 77%

Performance management 53% 49% 54% 65%

Recruitment 65% 58% 72% 75%

Remuneration / compensation & benefits 48% 45% 49% 56%

Rewards & recognition 39% 37% 38% 48%

Rostering / time & attendance 51% 49% 50% 61%

Succession management 21% 21% 18% 29%

Workforce planning 27% 27% 23% 40%

Workplace health & safety (WHS) 59% 57% 60% 67%

Highest value



Use of software / technology to minimise challenges


Over the following pages, the survey data is analysed to determine which challenges in specific functional HR areas are assisted by the use of software / technology.

Recruitment:

Respondents with fully implemented recruitment software / technology showed a reduction in roughly half of the challenges listed.

There were some surprising results. For example, even with technology implemented, 50% of respondents still found competition for talent to be a challenge (versus 43% for those without technology implemented). While more automation helps to reduce the time and resource challenges associated with each step in the talent acquisition process, it cannot by itself help employers find the right talent. However, with process-related tasks handled more effectively, the focus can shift to enhancing the employer brand, which in turn can be used in the war for talent.

Technology also streamlines processes such as making job offers, which can enhance the candidate experience. The latter became an even more critical element to consider during the remote working conditions seen throughout most of 2020.

It’s also worth noting the significant impact technology can have on easing the burden of manual or inefficient recruitment processes. In enterprise organisations, for example, 44% of those using recruitment technology indicated this was a challenge; this was selected by 70% of those without technology.

Has fully implemented technology

Does not have fully implemented technology

% pt. change

What are your organisation's key recruitment challenges?

Total resp. Total resp.

n = 600 n = 308

Creating a positive candidate experience 18% 20% 2%

Building a stronger employer brand 31% 30% -1%

A manual or inefficient recruitment process

18% 40% 22%

Reducing the time to hire 26% 24% -2%

Competition for talent 50% 43% -7%

Skills shortage 43% 39% -4%

Slow decision making / too many stakeholders

28% 23% -5%

Lack of HR resources 16% 19% 3%

None - we have no challenges 6% 6% 0%

Highest value





Onboarding:

Respondents who use onboarding software / technology selected fewer challenges than those who don’t. In particular, they reported a significant reduction in challenges relating to ad hoc or informal onboarding processes. There was also double the amount of respondents who selected ‘none – we have no challenges’ for those who had onboarding technology implemented compared to those without onboarding technology.

However, it’s also apparent that technology does not resolve all challenges. For example, challenges relating to the lack of regular check-ins with new hires was only marginally reduced for those who use technology. This may be due to the fact that the success of onboarding remains tied to interpersonal relationships, such as that between manager and employee. While technology may provide reminders and prompts to undertake certain tasks, it has limited impact on enhancing those relationships.

Certain challenges were amplified by technology. For example, ‘too much information for new hires’ was cited as a challenge by 33% of those who have technology but only 24% of those without technology. This reinforces how critical it is to have structured onboarding steps with the right information disseminated at the right times throughout the process.



% pt. change

What are your organisation's key onboarding challenges?


n = 415 n = 376

Ad hoc steps / lack of formal processes 18% 44% 26%

Too little information for new hires 8% 19% 11%

Too much information for new hires 33% 24% -9%

Lack of role clarity for new hires 16% 20% 4%

Lack of orientation for new hires 16% 32% 16%

Lack of training for new hires 22% 27% 5%

Lack of training for you / your team 9% 10% 1%

Length of onboarding process 19% 19% 0%

Lack of regular check-ins with new hires 31% 40% 9%

Integrating new hires into teams / culture 32% 33% 1%

None - we have no challenges 14% 7% -7%

Highest value







% pt. change

What are your organisation's key learning & development challenges?


n = 297 n = 432

Aligning training with corporate goals 23% 30% 7%

Difficulty demonstrating the return on investment (ROI) of training

21% 22% 1%

Difficulty scaling 9% 11% 2%

Finding the right external partners 18% 19% 1%

Lack of budget / funding 36% 46% 10%

Lack of resources 22% 33% 11%

Lack of senior leadership buy-in 25% 24% -1%

Low learner engagement 25% 22% -3%

Meeting compliance obligations 20% 18% -2%

Providing access to learning content 15% 27% 12%

Training program logistics 16% 20% 4%


Learning & development:

Technology reduced challenges in certain areas relating to learning & development, among them: a lack of resources, providing access to learning content, aligning training with corporate goals, and training program logistics.

However, technology will not resolve all learning & development challenges. Indeed, certain challenges remained in place regardless of whether or not technology was utilised. For example, ‘lack of budget / funding’ was cited by 36% of those with technology and 46% of those without technology, so it remains a significant challenge for all. ‘Low learner engagement’ was also selected as a key challenge by those with technology and by those without technology, indicating that effective instructional design and course content are critically important regardless of the delivery method.

‘Senior leadership buy-in’ was selected as a challenge by roughly a quarter of respondents, regardless of their technology status. This indicates that improvements may still need to be made in terms of quantifying the value of L&D to the business. Being able to provide key metrics or return on investment statistics can also assist with securing budgets and funding for learning initiatives.

Highest value







% pt. changeWhat are your organisation's key performance management challenges?


n = 365 n = 361

Lack of a formal performance framework 12% 33% 21%

Lack of appropriate recognition & rewards 21% 32% 11%

Lack of consistency between managers, departments, etc.

56% 57% 1%

Lack of formal processes 9% 32% 23%

Lack of manager training 46% 51% 5%

Lack of personal development plans 31% 43% 12%

Lack of recognition for high performers 27% 30% 3%

Lack of support for underperformers 20% 27% 7%

Lack of timely or meaningful feedback 42% 47% 5%

Manual processes 25% 45% 20%

Unclear goals / KPIs / OKRs 35% 49% 14%


Highest value


Performance management:

’Lack of formal processes’ and ‘lack of a formal performance framework’ were the two challenges most likely to be helped by the adoption of performance management software / technology. Indeed, all performance management challenges were reduced for those respondents using technology.

However, it’s also apparent that technology can only assist so much. Many of the ‘human’ elements of performance management remain challenging, regardless of software / technology usage. For example, ‘lack of manager training’ was cited as a challenge by 51% of those without performance management technology implemented, and remained high at 46% for those with technology. Similarly, ‘lack of timely or meaningful feedback’ was cited by 47% of those without fully implemented technology, and this only dropped to 42% for those with technology. This may suggest that although technology can streamline processes and provide prompts and reminders to undertake tasks, it has minimal impact on actual performance appraisals: this remains very much reliant on the skills and competence of managers.

It’s also interesting to note that challenges relating to performance outliers, i.e. those who are high performers and those who are underperformers, do not benefit greatly from the use of technology.




Succession management:

Most challenges relating to succession management were significantly reduced by the use of software / technology. It’s significant that more than twice as many respondents with software / technology implemented selected ‘none - we have no challenges’ than those without (13% vs. 6%).

Of all the challenges relating to succession management, keeping a record of current employees’ skills, experience and qualifications benefitted the most from the use of software / technology. 12% of respondents who use succession management software / technology cited this as a challenge, as opposed to 32% of respondents who do not use technology. Knowledge about existing employees’ skills and experience is fundamental to any succession plan. It’s difficult for managers to select possible successors without this knowledge.

In other areas, the use of software / technology had minimal impact on the challenges encountered: ‘weak talent pipeline’ was only marginally improved by the use of software / technology, while ‘weak bench strength’ was not improved at all with software / technology. Perhaps this is an indication that a succession plan requires an underlying strategy with a clearly articulated purpose and scope. For example, will only senior leadership roles have a succession plan in place, or will technical roles also have one?



% pt. changeWhat are your organisation's key succession management challenges?


n = 121 n = 524

External talent shortage 21% 19% -2%

Lack of budget 19% 23% 4%

Lack of professional development opportunities 21% 36% 15%

Lack of resources 15% 27% 12%

Lack of time 20% 26% 6%

New or emerging roles 25% 16% -9%

No buy-in from senior leadership 9% 19% 10%

No record keeping of current employees' skills, experience or qualifications

12% 32% 20%

Weak bench strength 17% 17% 0%

Weak talent pipeline 26% 30% 4%


Highest value







% pt. change

What are your organisation's key rewards & recognition challenges?


n = 249 n = 383

Discretionary effort is not recognised or rewarded

18% 34% 16%

High performers are not recognised or rewarded 17% 29% 12%Inconsistency (e.g. across managers, departments, etc.)

37% 47% 10%

Lack of budget 28% 35% 7%Lack of insight into what rewards employees would value

19% 34% 15%

Lack of peer-to-peer recognition 12% 22% 10%Lack of personalised rewards & recognition 20% 32% 12%Lack of resources 12% 21% 9%Lack of time 8% 15% 7%Low engagement with program 23% 16% -7%Over-reliance on financial reward 20% 23% 3%Recognition is not timely 20% 26% 6%None - we have no challenges 13% 8% -5%

Highest value


Rewards & recognition:

Inconsistency across managers, departments, etc. was the biggest challenge for respondents when it came to rewards & recognition, regardless of whether or not software / technology was utilised. However, there were several areas where it was clear that software / technology does help to overcome challenges. Examples include:

● Recognising or rewarding discretionary effort (cited by 18% of those with technology and 34% of those without technology)

● High performers not being rewarded or recognised (cited by 17% of those with technology and 29% of those without technology)

● Lack of insight into what kinds of rewards and recognition employees would value (cited by 19% of those with technology and 34% of those without technology)

It’s also apparent that technology assists in the delivery of peer-to-peer recognition and personalised rewards & recognition.

The only challenge that was not selected less by those with technology was ‘low engagement with program’, which may indicate that employers can’t fall into a ‘set and forget’ mentality when it comes to rewards & recognition. Any rewards & recognition program needs to be regularly updated and communicated to employees.






% pt. changeWhat are your organisation's key remuneration & benefits challenges?


n = 268 n = 334

Can't compete with external market rates 32% 31% -1%

Lack of flexibility 10% 14% 4%

Lack of transparency 15% 24% 9%

Misalignment between performance and remuneration

32% 41% 9%

No structured management process 14% 34% 20%

Process is too complicated 9% 8% -1%

Process is too lengthy 7% 10% 3%

Remuneration budget is frequently over 7% 6% -1%

Remuneration budget is frequently under 11% 11% 0%


Highest value


Remuneration & benefits:

Compared to the other functional areas, remuneration & benefits challenges were not as greatly impacted by the use of software / technology. However, it’s telling that a fifth (20%) of respondents with software / technology indicated they have no challenges at all, while only 11% of those without software / technology made the same claim. It’s also apparent that software / technology reduces challenges relating to not having structured processes in place.

It’s also clear that technology can only do so much. For example, ‘misalignment between performance and remuneration’ remained a challenge for 32% of those respondents with technology, which was only slightly better than the 41% of those without technology who cited this as a challenge. This might indicate that the gap between performance and remuneration can be closed more effectively by ensuring that there is meaningful feedback between managers and employees and by encouraging realistic key performance indicators (KPIs) and objectives & key results (OKRs) to track and encourage better performance.

Another example is the inability to compete with external market rates, which was cited by 32% of those with technology and 31% of those without technology. However, while software / technology by itself cannot improve market competitiveness when it comes to remuneration, it can help ensure remuneration budgets are being optimised through budget modelling and other tools, and help managers make more informed decisions by providing them with greater access to remuneration data.






% pt. change

What are your organisation's key payroll challenges? Total resp. Total resp.

n = 350 n = 80

Accurate reporting 15% 23% 8%

Compliance breaches 5% 14% 9%

Ensuring employee confidentiality 6% 3% -3%

General payroll and legislative knowledge by myself or the team 17% 20% 3%

Geographic differences (e.g. culture, language, legislation) 6% 11% 5%

Inaccuracy of data supplied to or input into payroll system 17% 28% 11%

Interpretation of Awards / Enterprise Agreements 24% 40% 16%Keeping up to date and understanding legislative changes affecting our business

20% 23% 3%

Lack of flexible reporting tools 18% 28% 10%

Lack of training 5% 16% 11%

Manual processes and workarounds 40% 50% 10%

Meeting deadlines 8% 15% 7%

Not having self-service tools for employees and managers to use 20% 30% 10%Number and frequency of ad hoc payments outside regular pay run

15% 18% 3%

Overpayment of staff 6% 11% 5%Poor or no integration between employee systems across HR vs. rostering / time & attendance, and / or payroll systems

29% 44% 15%

Staff not utilising self-service when available 17% 21% 4%

Underpayment of staff 6% 8% 2%


Highest value


Payroll:

Those who are using payroll software / technology are faced with significantly fewer challenges than those who are not. However, technology cannot resolve all issues.

For example, while roughly a third (29%) of respondents with payroll software / technology implemented said that ‘poor or no integration between employee systems across HR vs. rostering / time & attendance and / or payroll systems’ was a challenge, this escalated to 44% for those respondents without fully implemented software / technology. Having some parts of the payroll process automated, and other parts not (yet) automated can result in manual workarounds and increase the likelihood of data errors. Similarly, ‘general payroll and legislative knowledge by myself or the team’ remains a challenge for roughly a fifth of all respondents regardless of technology usage. This indicates that technology is just one component of payroll success. Adherence to compliance obligations and continuous upskilling of payroll staff are just as critical.

It may also be surprising to see that ‘manual processes and workarounds’ was still deemed a challenge by 40% of respondents with payroll software / technology (and 50% of those without), however, this may be attributed to payroll professionals double-checking figures through the use of spreadsheets.






% pt. changeWhat are your organisation's key rostering / time &

attendance challenges?


n = 205 n = 151

Ability to monitor shift and roster costs 13% 17% 4%

Communication to employees about rosters and changes 19% 17% -2%

Compliance 13% 19% 6%

Data input errors 19% 23% 4%

Ineffective leave management 17% 26% 9%

Ineffective reporting 9% 20% 11%

Ineffective rostering 12% 23% 11%

Keeping up to date with industrial awards, etc. 17% 13% -4%

Lack of flexible reporting 11% 15% 4%

Manual processes or workarounds 29% 42% 13%Monitoring certification eligibility to do particular shifts (e.g. licences, RSAs)

7% 8% 1%

No or ineffective integration of employee systems across HR vs. rostering / time & attendance, and / or payroll systems

16% 31% 15%

No real-time reporting 14% 27% 13%

The effort to fill a roster 13% 19% 6%

Too much absenteeism 16% 12% -4%

Too much overtime 11% 14% 3%

None - we have no challenges 19% 22% 3%

I don't know 9% 6% -3%

Highest value


Rostering / time & attendance:

Those who are using rostering / time & attendance software / technology are faced with fewer challenges than those who are not.

The challenges that were selected significantly less by respondents who use a form of rostering / time & attendance software / technology were:

● Manual processes● No real-time reporting● A lack of alignment with their payroll system

In addition, ineffective rostering was selected by 12% of those who have software / technology implemented and 23% of those who do not. Compliance-related challenges were also fewer for those who use software / technology.

Conversely, ‘keeping up to date with industrial awards, etc.’ was selected more by those respondents utilising software / technology, as was ‘too much absenteeism’. The latter is possibly due to absenteeism being easier to track with software / technology, thus making it more transparent if / when absenteeism levels increase.

The ratio of respondents who said that they do not have any challenges is roughly the same, regardless of whether or not rostering / time & attendance software / technology was implemented.


Collaboration tools / software

With COVID-19 forcing many organisations to operate remotely throughout 2020, a major challenge was maintaining collaboration and communication. To mitigate the risk of decline in these critical areas, nearly 1 in 2 organisations implemented or increased their investment into collaboration software. Indeed, there was a significant uptake of video conferencing technology and other forms of instant messaging technology in the wake of COVID-19 as organisations looked for ways to keep employees informed of a situation that was changing on an hourly or daily basis. One report suggested Zoom’s daily users jumped from 10 million to over 200 million in just 3 months.

Results from this survey indicate the top 5 collaboration platforms being used were:

1. Microsoft Teams – 77%2. Zoom – 58%3. Skype for Business – 26%4. Yammer – 15%5. Slack – 11%

Note: Respondents could select more than one type of software.


22%

26%

49%

3%

Did your organisation implement or decide to increase investment into your

connection / collaboration platform(s) in response to COVID-19?

Yes, we implemented this type of technology in response to COVID-19

Yes, we increased investment in this type of technology in response to COVID-19

No, we were already in the process of implementing or considering it prior to March 2020

I don't know

https://www.reuters.com/article/us-health-coronavirus-zoom/zoom-pulls-in-more-than-200-million-daily-video-users-during-worldwide-lockdowns-idUSKBN21K1C7


Priorities for FY20/21

2020 proved just how adaptable and agile organisations need to be in order to survive in a VUCA (volatile, uncertain, complex and ambiguous) world. Here are the top 3 priorities identified by respondents, based on a combination of their ‘high’ and ‘medium’ priorities:

1. Employee wellness: Half of respondents said this was a high priority for their organisation and roughly another third said it was a medium priority. This means that almost 90% of organisations plan to focus on employee wellness in 2021. In 2019, employee wellness was a high or medium priority for almost 75% of organisations, so there was a priority shift between 2019 and 2020. This was likely linked to the impact of COVID-19 on employee mental health and wellbeing (view Australian research here and New Zealand research here).

2. Compliance: In 2019, 76% of respondents said compliance was a high or medium priority. This increased to 84% in 2020. This can be attributed to many factors. For example: the introduction of various government support initiatives, especially wage subsidy programs, new work health and safety obligations relating to COVID-19, and the many compliance obligations related to workforce downsizing.

3. Learning & development: In 2019, learning & development was the top priority, with 80% of respondents saying it was a medium or high priority for their organisation. While this figure was similar in 2020 (77%), employee wellness has become a greater priority than learning & development. However, it stands to reason that professional development would remain a key way to increase employee capability, productivity and retention. Many employees were also required to upskill or reskill in new areas in order to take on the roles left by their departed colleagues. Research from McKinsey suggests that employers who committed to employee professional development during the pandemic will emerge stronger from the crisis.


50%

55%

34%

43%

31%

33%

24%

31%

25%

29%

30%

20%

24%

29%

17%

15%

7%

37%

29%

44%

35%

44%

36%

44%

37%

42%

37%

34%

40%

36%

31%

41%

39%

22%

9%

10%

18%

15%

17%

18%

24%

23%

23%

24%

21%

26%

24%

24%

29%

32%

41%

4%

6%

4%

8%

7%

13%

8%

9%

10%

11%

15%

14%

16%

16%

13%

13%

30%

Employee wellness

Compliance





HR reporting & analytics


Workforce planning

Recruitment

Managing a remote workforce

Onboarding

Infrastructure to better support remote working

HR technology implementation or consolidation



Offboarding

HR Priorities

High Medium Low Not a priority

https://www.pwc.com.au/health/health-matters/why-mental-health-matters-covid-19.html

https://www.nzma.org.nz/journal-articles/the-mental-wellbeing-of-new-zealanders-during-and-post-lockdown

https://www.mckinsey.com/business-functions/organization/our-insights/to-emerge-stronger-from-the-covid-19-crisis-companies-should-start-reskilling-their-workforces-now


Budgets in FY20/21

Below are the top 5 areas where respondents indicated that HR budgets had increased from 2019. All of these reflect the impact of COVID-19 and the way in which organisations had to reprioritise their spending to align their strategy with the current climate.

1. Infrastructure to better support remote working (40%)

2. Employee wellness (34%)

3. Communication / collaboration platforms (34%)

4. HR technology or consolidation (34%)

5. Management of a remote workforce (31%)

Below are the top 5 areas where HR budgets decreased from 2019:

1. Remuneration / compensation and rewards (15%)

2. Learning and development (14%)

3. Recruitment (14%)

4. Rewards & recognition (13%)

5. Onboarding or offboarding (7%)


26%

34%

34%

40%

16%

21%

17%

29%

22%

34%

18%

19%

19%

31%

16%

16%

8%

43%

34%

32%

24%

48%

42%

47%

34%

41%

28%

42%

41%

41%

28%

43%

41%

46%

4%

5%

6%

3%

6%

5%

7%

14%

14%

5%

13%

6%

15%

3%

5%

5%

7%

5%

6%

8%

9%

10%

6%

9%

4%

4%

7%

6%

13%

5%

13%

11%

14%

15%

22%

20%

20%

24%

20%

25%

21%

19%

19%

26%

21%

21%

21%

24%

24%

24%

24%


Employee wellness




Compliance

Onboarding


Recruitment






Workforce planning


Offboarding

HR Budget

Increased from last year Same as last year Decreased from last year

No budget allocated this year I don't know


Priorities and budgets FY20/21


n = 1440+

74%

69%

77%

74%

70%

67%

65%

62%

64%

77%

62%

71%

67%

72%

73%

74%

61%

Has budget regardless of priority level*

*Those who selected ‘not a priority’ were not asked if they have budget allocated.

50%

55%

34%

43%

31%

33%

24%

31%

25%

29%

30%

20%

24%

29%

17%

15%

7%

37%

29%

44%

35%

44%

36%

44%

37%

42%

37%

34%

40%

36%

31%

41%

39%

22%

9%

10%

18%

15%

17%

18%

24%

23%

23%

24%

21%

26%

24%

24%

29%

32%

41%

4%

6%

4%

8%

7%

13%

8%

9%

10%

11%

15%

14%

16%

16%

13%

13%

30%

Employee wellness

Compliance







Workforce planning

Recruitment


Onboarding





Offboarding

Priority level

High Medium Low Not a priority

Ensuring budgets are assigned to the most critical areas is challenging when the pace of change is so rapid. It’s clear there is some disconnect between the percentage of respondents who indicated each HR area as a high or medium priority and the percentage of respondents who have the budget to align with this. However, this disconnect was not as pronounced as that seen in 2019. In other words, budgets have been better aligned to priorities in FY20 / 21.

Among the biggest disconnects were:

● 86% of respondents said employee wellness was a high or medium priority, yet only 74% had budget allocated towards this

● 83% of respondents said compliance was a high or medium priority, yet only 69% had budget allocated towards this

● 75% of respondents said performance management was a high or medium priority, yet only 70% had budget allocated towards this

Conversely, we see that:

● 77% of respondents have budget for recruitment technology, yet only 65% said this was a high or medium priority

● 72% of respondents have budget for HR technology implementation or consolidation, yet only 58% said this was a high or medium priority

● 71% of respondents have budget for onboarding, yet only 62% said this was a high or medium priority


Metrics used to assess HR performance

39%

35%

23%

19%

18%

15%

12%

11%

10%

9%

8%

8%

7%

6%

6%

3%

32%

45%

42%

N/A

20%

24%

19%

14%

16%

11%

11%

13%

19%

8%

6%

8%

11%

N/A

Employee turnover

Employee engagement

Employee absenteeism

Length of service

Time to hire

HR complaints

Diversity & inclusion targets

Cost to hire

Employee Net Promoter Score (eNPS®^)

Pay equity

Customer satisfaction score (other than NPS®^)

I don't know

HR-to-employee ratio

Customer Net Promoter Score (NPS®^)

Cost of HR per employee

Other

None - we don't measure the overall performance of our HR department

Which metric(s) does your organisation use to measure the overall performance of your HR department?

2020 (n = 1169)

2019 (n = 1010)



Almost 1 in 3 organisations (32%) did not measure the performance of their HR department in 2020. This result was higher for SMBs (39%) and significantly lower for enterprise organisations (13%).

Employee turnover, employee engagement and employee absenteeism were the most commonly used metrics for assessing HR performance for organisations of all sizes.

Other responses did vary depending on organisation size however. For example, length of service was more likely to be utilised as a metric by mid-market organisations (23%) than enterprise organisations (15%) and SMBs (18%).

Diversity and inclusion targets were used to measure HR performance by 27% of enterprise organisations, 7% of SMBs and 15% of mid-market organisations. This indicates that even larger organisations are not very focused on diversity and inclusion beyond their mandatory compliance obligations. This insight is also echoed by the fact that only 10% of mid-market and enterprise organisations use pay equity metrics as a means of gauging HR performance.

It’s important to note that, in some cases, HR appears to be assessed against metrics they have little or no influence over, such as employee turnover. This metric is a more accurate reflection of managers’ performance than that of HR. Other metrics, such as customer satisfaction scores, are perhaps still not widely used due to the persistent belief that they are simply ‘not for’ HR and are better suited to tracking the performance of other parts of the business. Other important metrics (which were not included in the survey response options) are: internal referrals; ‘boomerang employees’ (i.e. returning employees); and ‘cross-boarding’ (i.e. employees who move to other roles within the same organisation).

Indeed, as the HR function matures and evolves, so too will the corresponding metrics and measures. For those just starting out on this journey, Deloitte recommends 7 key steps:

1. Start where you are: Assess your organisation’s current HR metrics capabilities and what your needs are to gain clear insight into potential gaps. Focus first on the ’lower hanging fruit’, or easy wins, while developing a longer-term analytics road map.

2. Ask the right questions: Understand which questions matter most to HR, as well as to the broader business (including strategy and priorities).3. Use ‘right-size’ metrics: Match the metrics and measurements with those ‘right questions’ that need to be addressed.4. Accelerate insights: Automate the delivery of key information to HR (and organisation) stakeholders.5. Focus on user engagement and visualisation: Create output that delivers insights end users truly need in the forms that will enable HR and the business to execute fact-based decision-making.6. Work towards creating a fact-driven culture: Embed metrics and reporting capabilities into HR decision-making processes and procedures.7. Remember change management: Knowing how and when to communicate change to users and HR customers takes significant planning and strategy. Whenever changes are made, additional

business risk is always introduced.

https://www2.deloitte.com/content/dam/Deloitte/us/Documents/human-capital/us-hc-enabling-business-results-with-hr-measures-that-matter.pdf


None: We don't use HR metrics at all

Basic: We have some basic HR metrics but they don't factor heavily into business decisions

Developing: We track HR metrics and leverage these metrics for decision-making purposes

Optimised: We track HR metrics and apply descriptive analytics, pulling insights out of historical data to facilitate our decision-making

Advanced: We track HR metrics and apply predictive and / or prescriptive analytics, forecasting future possibilities and options, to better inform our decision-making

I don't know

Level of skill using HR metrics

How would you describe your organisation's skill level using HR metrics?

3% 3% 6% 4% 6%11%

5% 4%

5%

2%4% 3%5% 8%

8%

8%

5% 5%

29%22%

35% 32%

42%35%

34%27%

44%

42%

40%43%

37% 36%

41%

42%

19%28%

11% 12%4% 5%

13%20%

2019 2020 2019 2020 2019 2020 2019 2020

n = 418 n = 622 n = 425 n = 409 n = 163 n = 133 n = 1006 n = 1164

SMB (1 - 199) Mid-market (200 - 1999) Enterprise (2000+) OverallSMB (1 - 199)

Mid-Market (200 - 1999)

Enterprise (2000 +)

Overall



The comparison of 2020 results with 2019 results revealed limited change in the level of skill in the use of HR metrics. Indeed, results in 2020 could be deemed disappointing. In 2019, 34% of respondents classified their skills in the use of HR metrics as ‘developing’, but this dropped to 27% in 2020. There was also an increase in the percentage of organisations that were not using any metrics at all (13% in 2019 vs. 20% in 2020).

Enterprise organisations remained the leaders, with 43% of respondents classifying their usage of HR metrics as either ‘developing’ or ‘optimised’. Mid-market organisations were slightly behind, with 40% using those two classifications. The skill level of SMBs regressed across all classifications (‘basic’, ‘developing’, ‘optimised’ and ‘advanced’). The number of SMB respondents that selected ‘none’ increased from 2019 to 2020.

While it’s understandable that upskilling in metrics may have taken a back seat during a challenging year, it’s also apparent that what suffers the most without the use of HR metrics is the level of organisational insight. It’s difficult to anticipate risks, inform strategy and prepare for the future without HR metrics. It’s also difficult to justify decisions without accessing and utilising metrics – and in 2020 there were plenty of tough decisions to be made (e.g. downsizing). A lack of knowledge about the metrics that matter can result in blanket decisions being made on the fly, instead of a more nuanced and targeted approach being taken. The former approach can be devastating, especially when it comes toredundancies and other significant corporate upheavals.

Research in June 2020 by the HR Analytics ThinkTank revealed how crucial it is for HR professionals to have at least a basic level of HR metrics in place during uncertain times. In that research, 79% of those surveyed said their analytics function added more value to HR decision-making during COVID-19 than during other, more settled times. This basic data (for example, headcount data, work style or work-from-home data, absence and sickness data, employment type data and productivity data) is what will add value down the line as new challenges emerge and organisations return to some semblance of 'normal'.

Similar to the findings of our data (see ‘challenges faced implementing HR metrics’), the HR Analytics ThinkTank research also revealed how critical it is to have the right technology and tools. Nearly half (45%) of respondents said they lacked the tools to add the most value to decision-making during COVID-19.

Cloud technology may be assisting. The HR Analytics ThinkTank research found that 95% of respondents were able to access data and software remotely – in other words, they did not require access to on-site technology and tools.

Just over 1 in 4 respondents rate their skills in HR metrics as

‘developing’

1 in 5 respondents do not use any HR metrics at all

Almost 1 in 10 enterprise respondents said their skills in HR

metrics was ‘optimised’

https://www.hranalyticsthinktank.com/news-and-updates/how-are-hr-analytics-helping-decision-making-during-the-covid-19-crisis-summary-r34/


Top 5 challenges faced implementing HR metrics

56%

55%

54%

42%

42%

41%

35%

35%

32%

31%

8%

6%

47%

55%

47%

36%

47%

38%

33%

35%

26%

30%

13%

7%

Identifying quantifiable links between HR and business goals

Lack of technological infrastructure

Identifying value-add HR metrics

Subjectivity of HR measurement

Obtaining raw data

Interpreting HR measurement with corporate measurement

Assigning accountability for metrics

Making metrics information available

Linking incentives with HR metrics

Lack of skills among HR staff

I don't know

None - we have no challenges

What are the top five challenges you have faced / are facing when trying to implement HR metrics within

your organisation?

2020 (n = 809)

2019 (n = 955)



Identifying quantifiable links between HR and business goals, identifying value-add HR metrics, subjectivity of HR metrics, and linking incentives with HR metrics have all increased significantly as challenges since 2019. These results show that HR teams are struggling to develop metrics that have real meaning for their senior leaders and, as such, may not be accurately demonstrating the true value of their efforts. However, looking at these significant shifts through a positive lens, it means that more HR teams are starting to think about metrics and trying to determine how to use them effectively.

Different HR metrics will be meaningful to different types of stakeholders. Within an HR team, there might be a number of metrics used to measure success and manage performance specific to HR activities. The collection of these metrics is commonly referred to as an HR scorecard. The HR scorecard is not solely about HR performance – it is about enabling market opportunities, building competitiveadvantage, and driving business results (read more here).

This definition means that HR metrics must be linked to the overarching business goals. HR must fully understand what the business goals are to identify what metrics will be of interest at the executive level. For example, if one of the organisation’s goals is to gain more market share, then HR needs to familiarise themselves with the plan to do this, and what HR activities will contribute to the success of this goal.

If the plan to gain market share is to acquire other organisations and their existing staff, then HR might use metrics that quantify the efficiency of onboarding acquired employees into the company (e.g. time taken to complete the transition process) and the experience that acquired staff have when they start with the new company (e.g. employee engagement measured through employee experience andengagement surveys and the subsequent turnover rate of acquired staff).

However, if the plan is to gain more market share by expanding and upskilling the sales team, the metrics would be very different. Metrics such as time to hire new sales professionals and the quality of the hire (e.g. time it takes to start meeting sales targets and hiring manager feedback about new starter performance) will be of greater interest to the C-suite. In addition, any costs relating to learning & development for sales staff might be analysed in conjunction with the increase in sales to assess how effective the learning & development was and the return on investment.

Without clear guidance about the overarching goals and objectives of the organisation, it is challenging for HR teams to determine meaningful metrics to present to leaders that demonstrate how HR has contributed to those goals.

More than 1 in 2 respondents struggle to identify quantifiable links between

HR and business goals

4 in 10 respondents said obtaining raw data was a key challenge

1 in 3 respondents said a lack of skills among HR staff was a challenge

https://www.analyticsinhr.com/blog/hr-scorecard/


Measuring performance of the functional areas of HR

43%

42%

40%

39%

34%

31%

30%

28%

26%

25%

22%

19%

19%

18%

8%

4%

8%

5%

52%

51%

39%

43%

37%

25%

22%

30%

26%

36%

23%

N/A

20%

23%

11%

6%

N/A

6%

Recruitment






Employee wellness

Payroll

Onboarding



Communication / collaboration





None - we don't measure the performance of any areas of our organisation

I don't know

Which of the following areas does your organisation measure the performance of?

2020 (n = 863)

2019 (n = 803)




n = Has fully implemented technology Does not have fully implemented technology

Payroll 239 87% 13%

Communication / collaboration 165 81% 19%

Recruitment 369 77% 23%

Rostering / time & attendance 165 77% 23%

Workplace health & safety (WHS) 366 72% 28%

Rewards & recognition 156 69% 31%

Onboarding 224 67% 33%

Performance management 334 66% 34%

Remuneration / compensation & benefits 219 61% 39%

Succession management 66 59% 41%

Employee wellness 255 54% 46%

Highest value




Technology plays a significant role in assessing various aspects of organisational performance. All areas, from recruitment and payroll through to performance management and employee wellness, were more likely to be assessed when technology was fully implemented.

However, apart from a few exceptions, most areas that could be measured declined between 2019 and 2020. Performance management, recruitment, workplace health & safety and remuneration / compensation declined the most.

Several areas saw an uptick in measurement, including employee wellness and diversity & inclusion. Given the events of 2020, it was no surprise to see employee wellness increase as a means of assessing organisational performance, simply because so much depends on having healthy employees – from levels of absenteeism and presenteeism to productivity and engagement.

The reasons for the increased number of respondents who selected diversity & inclusion as a means of assessing organisational performance were less clear-cut. This relatively high level (31%) contradicted the responses to a previous question, which asked about the metrics used to specifically assess HR performance (where diversity & inclusion declined as a metric). This could be due to diversity & inclusion moving beyond being deemed solely an ‘HR problem’. It is now seen as the responsibility of all business leaders and executives. Indeed, there are now statutory reporting requirements relating to gender equity, which is a critical part of most diversity & inclusion programs. In Australia, all non-public sector employers with 100 or more employees in their corporate structure are required to report annually to the Workplace Gender Equality Agency (WGEA). A similar requirement is being debated in New Zealand.

9 in 10 respondents with fully implemented technology are able to measure the performance of their payroll processes

Just over 1 in 2 respondents with fully implemented technology are able to track and assess employee wellness

3 in 4 respondents with fully implemented technology are able to measure the performance of their recruitment function

https://www.wgea.gov.au/what-we-do/reporting

https://www.nzherald.co.nz/business/companies-should-be-forced-to-report-on-gender-pay-gap-union/7XMRKP6CUTMDEETJV5DOEX76A4/


Top 3

Skills that HR professionals aim to develop

41%

39%

32%

32%

32%

29%

28%

26%

25%

20%

20%

19%

19%

17%

16%

16%

13%

7%

3%

44%

42%

N/A

36%

34%

N/A

N/A

N/A

25%

N/A

15%

22%

N/A

19%

16%

N/A

N/A

8%

N/A

Strategic planning


Managing employee wellness

Change management

Organisational development

Workforce planning and job analysis

General business knowledge and skills

Remote workforce management

Communication and employee relations

Conflict management

Risk assessment and mitigation

Program development and implementation

Policy / procedure creation

Negotiation skills

Budget management

Policy / procedure enforcement

Problem solving

Other

None - I don't intend to develop new skills

Which skill(s) are you aiming to develop for yourself in the next 12 months?

2020 (n = 1533)

2019 (n = 1207)


Skills that HR professionals aim to develop

Strategic planning was the most popular skill for HR to develop for themselves over the coming 12 months. Having come through the crisis management phase, where the focus was on keeping people safe and ensuring supply lines and critical areas of business kept humming, 2021 will be about post-pandemic strategy. This requires a conscious shift in thinking. One Forbes article stated: “It’s going from ‘fire fighting’ to fire-starting, from tactical to strategic. It’s about shifting from an ad hoc, crisis-driven, reactive mode of operating, to a pro-active, can-do, seeing-what’s-next mode of operating. It’s about carving out time to consider how the world is changing, and will evolve during the next year, three years and five.”

‘HR reporting & analytics’ was the second most popular skill to develop. Although HR’s use of data and analytics was still low throughout 2020, having ‘HR reporting & analytics’ rate so highly as a desired skill indicates a growing awareness that data literacy will be critical as organisations emerge from COVID-19. PwC stated the following:

“In an effort to stay competitive in the modern and complex business landscape, particularly as a result of COVID-19, organisations should continue to leverage analytics to forecast their workforce requirements and to better optimise revenues and reduce costs. They should also become more reliant on analytics to measure and monitor workforce performance and productivity. By regularly analysing and monitoring employee performance and engagement metrics, HR can determine the strategic talent acquisition, development and management decisions required to prepare the workforce for the challenges they will face post COVID-19.”

Despite several ‘soft’ (or ‘essential’) skills having been identified as the top recovery-focused HR skills in 2021 by the Australian Human Resources Institute (among them flexibility, adaptability and agility), in this survey, ‘soft’ skills fared poorly. Negotiation skills and problem solving were given low priorities, although a quarter (25%) of respondents indicated ‘communication’ was a focus area.

Other areas to note include:

● ‘Risk assessment and mitigation’, which saw a 5 percentage point increase from 2019. In many organisations, risk management took on new urgency as leaders dealt with increased regulations and compliance requirements. The focus on employee health and safety due to COVID-19 also likely increased the desire to learn more about risk assessment and mitigation.

● ‘Change management’, which remained popular, with just under a third (32%) of respondents selecting this. This is also a rapidly evolving area, which HR would benefit from staying on top of. For example, Gartner research shows that successful change management outcomes require a shift away from the traditional cascading of initiatives down from senior leaders to employees. Open-source change involving employees directly is seen to be more effective. Gartner says the probability of change success increases by as much as 24 percentage points with an open-source approach.

● ‘General business knowledge and skills’, which was selected by just under a third (28%) of respondents. This figure was higher for junior to mid-level managers. COVID-19 has also likely impacted this area. Although HR professionals have been criticised for their lack of general business knowledge in the past, the pandemic forced organisations to rely on and leverage HR in unprecedented ways. This in turn improved HR’s depth of knowledge across all facets of business operations. For perhaps the first time in the profession’s history, ‘general business knowledge and skills’ is less of a priority.

https://www.forbes.com/sites/robertbtucker/2020/07/10/seeing-whats-next-6-strategies-for-shaping-your-post-pandemic-future/?sh=7b610344d923

https://www.pwc.com/m1/en/publications/how-the-new-normal-shaping-future-hr.html

https://www.ahri.com.au/media/l1xfjvtm/ahri_futureskillsreport_october2020.pdf

https://www.gartner.com/smarterwithgartner/future-of-work-tops-hr-priorities-for-2020-21/


Measuring employee engagement

Do you have a formal process in place to measure employee engagement?

48%42%

67% 69%81%

67%61%

54%

48%53%

30% 29%11%

21% 35%41%

5% 5% 3% 3%8% 12%

5% 5%

2019 2020 2019 2020 2019 2020 2019 2020

n = 398 n = 597 n = 407 n = 391 n = 151 n = 127 n= 956 n= 1115

SMB (1 - 199) Mid-market (200 - 1999) Enterprise (2000+) Overall

Yes No I don't know

SMB (1 - 199)

Mid-Market (200 - 1999)

Enterprise (2000 +)

Overall



A formal process to measure employee engagement is embedded into just over half (54%) of the organisations surveyed. There were slight variations based on organisation size. For example, 2 in 3 mid-market and enterprise organisations indicated they had a formal process in place, while less than half (42%) of SMBs had something in place. SMBs and enterprise organisations saw a decline in the use of formal processes to measure engagement between 2019 and 2020, and indeed, the overall percentage of those using formal processes declined from 61% in 2019 to 54% in 2020.

Research has shown that many of the disruptions taking place prior to COVID-19, such as new business models being implemented and exponential technology usage, have only been hastened by the pandemic. As a result, measuring employee engagement has never been more critical. HR industry observer Josh Bersin suggested that at the height of the pandemic, many organisations were treating their employees better than ever before. Bersin added that employee disengagement – a problem that plagues more than two-thirds of organisations year after year – actually decreased due to this care and attention, not to mention the extra focus on corporate culture. It therefore makes sense that business leaders would want to regularly “check the pulse” of their workforce by undertaking regular engagement surveys.

4 in 10 SMB respondents have a formal process in place to measure engagement

2 in 3 mid-market and enterprise organisations have a formal process in place to measure engagement

More than 1 in 2 respondents have a formal process in place to measure engagement

https://www2.deloitte.com/mt/en/pages/human-capital/articles/mt-employee-engagement-and-covid-19.html

https://joshbersin.com/2020/04/covid-19-may-be-the-best-thing-that-ever-happened-to-employee-engagement/


Net Promoter, Net Promoter System, Net Promoter Score, NPS and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.

Tools / techniques to measure employee engagement

81%

65%

53%

40%

30%

18%

9%

0%

85%

66%

43%

35%

27%

16%

8%

1%

Engagement surveys

Exit surveys

Pulse surveys

One-on-one meetings with employees

Onboarding surveys

Employee Net Promoter Score (eNPS®)

Stay surveys

I don't know

How do you measure employee engagement?

2020 (n = 600)

2019 (n = 578)


Tools / techniques to measure employee engagement

In terms of how employee engagement is measured, the biggest change from 2019 was the increase in the use of pulse surveys, followed by the increase in the use of onboarding surveys and one-on-one meetings with employees.

The popularity of pulse surveys has grown in recent years, with research showing that for organisations not using traditional engagement surveys, most (64%) are using small-scale pulse surveys and one-off, topic-specific surveys to measure engagement.

A ‘less is more’ mentality is driving the rationale for shorter, sharper surveys. Another reason for their increased popularity is because the amount of data gathered, analysed and actioned from these surveys is far more manageable for everybody –HR teams, senior leaders and managers. A smaller volume of insights can be digested and actioned per survey, which means that surveys can be conducted more regularly. It also means employee engagement is tracked more frequently. Some organisations undertake weekly, monthly or bi-monthly surveys to have a constant measure of engagement, which can be combined to create an ‘end-of-year score’.

PeoplePulse, an ELMO company, suggests these best practice tips when using pulse surveys:

● Limit the number of questions asked so that the information gathered remains relevant and survey respondents don’t feel overwhelmed

● Ensure the questions are relevant to your organisation’s current goals and opportunities● Prepare in advance a simple action planning framework and post-survey communication plan that can be executed

in a timely manner after the survey results have been released. Delays in releasing reports and / or action planning can mean that survey results are quickly forgotten about because business priorities can change so quickly

● Identify your top 2 or 3 strengths to promote to the wider organisation to reinforce positive messages, but do not forget to be open and transparent about at least one area of opportunity to improve, which the organisation is willing to commit to changing. This balanced approach is important, as it demonstrates that leaders have listened to employee feedback, taken it seriously and will do something with it

● Whenever there is an opportunity to do so, leaders should regularly mention the initiatives being introduced in employee discussion forums, and link these back to the results from the pulse survey. This format can be very simple, e.g. “You said… So we did…”

4 in 5 respondents use engagement surveys to measure employee engagement

Just over 1 in 2 respondents use pulse surveys to measure engagement

Just under 1 in 10 respondents use stay surveys to measure engagement

https://www.gartner.com/smarterwithgartner/is-it-time-to-toss-out-your-old-employee-engagement-survey/

https://peoplepulse.com/


Engagement measurement challenges

24%

23%

21%

19%

17%

14%

11%

8%

4%

14%

26%

25%

21%

26%

14%

21%

6%

7%

We don't feel the need for a formal process given the size of our organisation

We don't have buy-in from senior leadership (e.g. C-level, Directors)

Too busy to implement / no resources

We don't have the budget

A process is in the planning stage but is not yet implemented

We measure employee engagement informally, so do not need a formal process

We don't see measuring engagement as a priority right now

I don't know

We don't see measurement of employee engagement adding significant value to the organisation

Why doesn't your organisation have any formal processes in place to measure employee engagement?

2020 (n = 448)

2019 (n = 318)



Engagement measurement challenges

‘We don’t feel the need for a formal process given the size of our organisation’ was the number one reason for not measuring employee engagement, which was almost exclusively selected by SMBs. Some 33% of SMBs and 4% of mid-market respondents selected this option.

A lack of buy-in from senior leaders was an issue for 23% of SMBs and 19% of SMBs. Somewhat surprisingly, this was selected by 38% of enterprise respondents.

‘Too busy to implement / no resources’ appeared to be more of an issue for larger organisations. This was selected by 18% of SMBs, 27% of mid-market organisations, and 31% of enterprise organisations.

A higher percentage of mid-market organisations had a formal process in place to measure engagement than enterprise organisations, and of those that didn’t, 30% said they were in the process of planning one.

Regardless of organisational size, in times of great uncertainty and change, hearing and acting upon ‘the voice of the employee’ becomes more important. Employee surveys can be used to help organisations gather baseline data to build business cases and measure the impact of change initiatives.

Obtaining senior leadership buy-in is critical. Here are two tips from PeoplePulse, an ELMO company, to obtain that buy-in:

● Link employee engagement results with business performance metrics. This can be a way of demonstrating how employee engagement has a tangible impact on the organisation and can be done at both an organisational and departmental level. For example, if engagement levels were to go down in the Customer Service department, would there also be a decrease in customer satisfaction or an increase in employee turnover? For each department, use one or two common metrics that are easy to source, such as employee turnover and absenteeism rates, plus one or two department-specific metrics that relate to department performance, such as sales revenue, customer retention, or data input accuracy rates. HR may need to partner with other stakeholders in the organisation to capture some of the additional metrics. Doing so provides a more holistic employee engagement scorecard that can directly link employee engagement back to business performance.

● Promote the benefits of having a ‘feedback culture’. Employee surveys that are executed well don’t just gather data that is useful to a select group of people. Everyone stands to benefit. Survey results give senior leaders an opportunity and platform to connect with their people and show them that their collective voices are valued. Sharing survey learnings openly and transparently with the wider organisation models a culture where people are listened to, their feedback is genuinely valued, and it is safe to put forward suggestions and raise new ideas.

1 in 4 respondents said a lack of senior leadership buy-in was

their biggest engagement measurement challenge

1 in 3 enterprise respondents said they were too busy to implement a measurement

process or did not have resources to do so

https://peoplepulse.com/


Wellbeing initiatives

n = 1194

76%

25%

24%

24%

24%

23%

17%

11%

11%

1%

Employee assistance programs

Corporate social responsibility (CSR) / volunteering day(s)

Mental health day(s) / programs

Gym memberships / subsidies

Access to a wellbeing application

Health insurance coverage / subsidies

Yoga / meditation

None - we have no wellbeing initiatives

Other

I don't know

What wellbeing initiatives does your organisation offer?



An employer’s duty of care extends not just to creating safe working conditions, but also to doing whatever is possible to safeguard the wellbeing of employees. COVID-19 reinforced how critical this duty of care is, especially with remote working becoming so widespread in 2020.

Employee Assistance Programs (EAPs) were by far the most popular wellbeing initiative, with 2 in 3 SMBs and 9 in 10 mid-market and enterprise organisations having one in place.

The focus on mental health throughout 2020 is confirmed by other research. For example, The State of Wellbeing in Australia report by the Australian Human Resources Institute and The Wellbeing Lab found that over 80% of surveyed workers were anxious about the coronavirus and over 90% said they were nervous about the economy. Only 10% of workers said they were ‘constantly thriving’. The situation was similar in New Zealand. Research from the University of Otago indicated that 30% of those surveyed reported moderate to severe psychological distress and 16% had moderate to high levels of anxiety. Almost 40% said their level of wellbeing was low.

Whilst enterprise organisations were more likely to have a range of wellbeing initiatives to choose from, the difference in results for this question between mid-market and enterprise organisations was not vast. The biggest differences were that enterprise organisations were more likely to offer gym and health insurance subsidies and access to a wellbeing application. For SMBs, the percentages for all wellbeing initiatives were consistently lower than their larger counterparts.

3 in 4 respondents use employee assistance programs (EAPs) to support employee wellbeing

1 in 4 respondents use mental health days / programs to support employee wellbeing

1 in 10 respondents do not have any employee wellbeing initiatives in place

https://www.hrmonline.com.au/covid-19/everyone-is-struggling/

https://www.sciencedaily.com/releases/2020/11/201109110244.htm


Flexible working options

n = 1218

80%

72%

70%

57%

50%

49%

41%

41%

39%

39%

35%

29%

29%

26%

25%

3%

2%

0%

Flexible start / finish times

Part-time work

Leave without pay

Time-in-lieu

Work from home sporadically

Work from home 1-2 days a week

Parental leave (above statutory requirements)

Working from other locations

Work from home 3 or more days a week

Swapping workdays (if part-time)

Compressed days (e.g. working longer hours per day to…

Purchased leave

Job sharing

Rostered days off (RDO)

Career breaks (unrelated to parental leave)

Our organisation doesn't offer flexible working options

Other

I don't know

What type of flexible working options does your organisation offer?



2020 proved to be the largest remote working experiment the world has ever seen. The global pandemic thrust flexible work practices into the spotlight and many organisations were forced to adopt alternative work arrangements for the first time. Of course, flexible work encompasses more than offering work-from-home (WFH) options. Here is a summary of results from the 2020 survey:

● Most organisations (80%) offered flexible start and finish times as a minimum● 1 in 2 organisations offered WFH sporadically or 1-2 days per week● 1 in 3 organisations offered compressed hours, which is an emerging trend● Only 3% of organisations said they do not offer any form of flexible working options● Enterprise organisations are generally more mature in their flexible work offerings. The largest differences were their offerings relating to career breaks

(unrelated to parental leave), job sharing, purchased leave, RDOs, working from home three or more days per week and working from other locations

ELMO ran a Work From Home (WFH) Survey in June 2020, which was completed by nearly 300 HR professionals. The goal of the survey was to find out more about WFH provisions and senior leader attitudes towards working from home both before and during COVID-19. The results of the survey revealed that, before the pandemic, only half of organisations had senior leaders who were supportive (to some degree) of working from home, but it was mostly only available to those who had a good enough reason to justify it. The results from the WFH Survey echo the results for this question, with only half of survey respondents saying they offer WFH sporadically or 1-2 days per week.

In the wake of COVID-19, expectations around where and when work is undertaken have shifted. Attracting and retaining top talent who now expect formalised working from home opportunities will become an issue for organisations who are not willing to adjust to this so-called ‘new world’. Another insight from the WFH Survey was that 46% of respondents thought their senior leaders would be significantly more open to WFH options part-time or full-time post pandemic, and another 32% thought their senior leaders would be slightly more open to it.

The benefits of flexible work are becoming increasingly apparent. This article from Forbes suggests that flexible work can provide smaller organisations with a competitive edge, especially when it’s not possible to match the staff benefits of their larger rivals. It can also help organisations cope with the demands of globalisation. Specifically, the demand for customer services across time zones and outside of 9-to-5 has driven the emergence of alternative shift patterns and organisations with these flexible options in place will benefit. Finally, flexible work widens the available pool of talent to those unwilling or unable to work traditional hours or commute to and from a physical workplace.

4 in 5 respondents offer flexible start / finish times

1 in 3 respondents offer the option to purchase

leave

https://elmosoftware.com.au/resources/research-reports/elmos-work-from-home-survey/

https://www.forbes.com/sites/joyburnford/2019/05/28/flexible-working-the-way-of-the-future/?sh=2767060c4874


Flexible work challenges

n = 1202

39%

37%

35%

29%

29%

28%

27%

27%

26%

23%

20%

15%

9%

9%

5%

5%

2%

Getting consistency across all managers to allow flexible work options within their own team

Maintaining adequate levels of communication / collaboration across remote vs. non-remote staff

Operational issues related to flexible work options

Negative stigma associated with working from home

Reduction (perceived or actual) in productivity resulting from flexible work options

Convincing top-level management of the benefits of flexible work options

Measuring the use and / or success of flexible work options

Creating equal opportunities for staff who want or need flexible work options

Demonstrating the return on investment (ROI) of flexible work options

Issues with employees misusing or abusing flexible work privileges

Demonstrating tangible benefits of flexible work options (e.g. increased employee wellness or engagement)

The creation of online communities and support networks for remote workers

Lack of flexible work options to attract talent and / or retain staff

Increasing staff awareness about their flexible work options

Other


I don't know

What are the top challenges for your organisation when it comes to providing flexible work options?



n = 1202

While flexible work offers many benefits to employers and employees, it also presents a raft of challenges. The top 3 challenges are: consistency in how flexible working is applied across the organisation, managing communication / collaboration when some staff are working remotely, and other operational issues that occur when staff are utilising different types of flexible work options.

29% of respondents said that negative stigma about working from home is a top challenge for them, and 28% said they’ve struggled to convince senior management about the benefits of flexible work options. It doesn’t help that 29% of respondents said they were challenged by a reduction in productivity (perceived or actual) and 23% said that staff misusing or abusing flexible work options was a problem for them.

4 in 10 respondents said consistency across managers

was a top challenge

More than 1 in 3 respondents said maintaining adequate levels of communication between

remote and non-remote staff was a challenge

Just over 1 in 4 respondents said a reduction in productivity (perceived

or actual) was a challenge


Appendix A:Respondent profile data



n = 1928

Location of respondent

85%

15%

Country


30% 30%

19%

9% 6% 3% 2% 1%

NSW VIC QLD WA SA ACT TAS NT

State (Australia)

39%

16%

15%

7%

5%

5%

3%

2%

2%

1%

1%

1%

1%

0%

0%

Auckland

Wellington

Canterbury

Waikato

Otago

Bay of Plenty

Whanganui - Manawatu

Hawke's Bay

Southland

Nelson - Tasman

Northland

Taranaki

West Coast

Gisborne

Marlborough

Region (NZ)

n = 1928

n = 1928


[1] 1 - 199 employees = Small to medium businesses (SMB) 53% of respondents

[2] 200 - 1999 employees = Mid-market 34% of respondents

[3] 2000 + employees = Enterprise 14% of respondents

SMB (1 – 199 employees) Mid-market (200 – 1999 employees) Enterprise (2000+ employees)

n = 1928

Organisation size classifications

23%

14%

10%6%

18%

10%

6% 5% 4% 5%

1 - 49 50 - 99 100 - 149 150 - 199 200 - 499 500 - 999 1,000 - 1,999 2,000 - 4,999 5,000 - 9,999 10,000+

Organisation Size (no. employees)


24%28%

26%

19%

3%

Leadership / C-level Senior management Mid-level management Junior to mid-level (individual

contributor)

Other

Level of seniority

n = 1639 289 1016 651 261

Seniority Level Australia New ZealandSMB Mid-market Enterprise

(1 - 199) (200 - 1999) (2000+)

Junior to mid-level 18% 23% 12% 25% 31%

Mid-level management 26% 22% 23% 27% 35%

Senior management 28% 26% 30% 27% 24%

Leadership / C-Level 24% 25% 32% 19% 8%

Seniority level

Note: The general rule is that, in order for responses to have statistical significance, they should have a minimum sample size of 30 respondents. Having said that, inferences can still be made from any data points that have less than 30 respondents and we have therefore left the data points with less than 30 responses visible in the report for your perusal. It is only a small subset of the industry-segmented data that will have less than 30 respondents for specific questions.

Highest value


n = 1928


Industry No. Resp.

Professional, Scientific And Technical Services 330

Health Care And Social Assistance 202

Not-For-Profit 187

Financial And Insurance Services 164

Education And Training 134

Public Administration And Safety 126

Information Media And Telecommunications 118

Manufacturing 117

Construction 88

Retail Trade 71

Transport, Postal And Warehousing 64

Accommodation And Food Services 59

Electricity, Gas, Water And Waste Services 59

Administrative And Support Services 45

Agriculture, Forestry And Fishing 34

Wholesale Trade 33

Mining 32

Rental, Hiring And Real Estate Services^ 29

Arts And Recreation Services^ 27

Other^ 9

17%

10%

10%

9%

7%

7%

6%

6%

5%

4%

3%

3%

3%

2%

2%

2%

2%

2%

1%

0.5%

Professional, Scientific And Technical Services

Health Care And Social Assistance

Not-For-Profit

Financial And Insurance Services

Education And Training

Public Administration And Safety

Information Media And Telecommunications

Manufacturing

Construction

Retail Trade

Transport, Postal And Warehousing

Accommodation And Food Services

Electricity, Gas, Water And Waste Services

Administrative And Support Services

Agriculture, Forestry And Fishing

Wholesale Trade

Mining

Rental, Hiring And Real Estate Services

Arts And Recreation Services

Other

Industry types (as per the ANZSIC industry list)

Industry type

n = 1928

Click here to reference the full ANZSIC list

https://www.abs.gov.au/ausstats/[email protected]/0/20C5B5A4F46DF95BCA25711F00146D75?opendocument


n = 1928

Which areas are respondents involved with?

42%

39%

41%

39%

49%

43%

47%

45%

34%

36%

32%

33%

29%

29%

22%

16%

48%

49%

45%

45%

35%

38%

33%

33%

43%

42%

41%

39%

42%

41%

30%

30%

10%

12%

15%

16%

17%

18%

20%

22%

23%

23%

27%

28%

29%

31%

48%

54%

Employee engagement


Employee wellness


Onboarding


Recruitment








Payroll


Which of the following area(s) are you responsible for or actively involved in?

Responsible for Actively Involved Not Involved


n = 1928 365 496 541 468

Responsible for: Overall Junior to mid-levelMid-level

managementSenior management Leadership / C-level

Diversity & inclusion 34% 7% 16% 45% 63%

Employee engagement 42% 12% 25% 56% 68%

Employee wellness 41% 15% 24% 52% 67%

Industrial / employee relations 45% 14% 29% 58% 73%

Learning & development 39% 12% 25% 49% 63%

Onboarding 49% 28% 39% 60% 62%

Organisational culture 39% 12% 22% 45% 72%

Organisational design 29% 4% 11% 32% 63%

Payroll 22% 9% 15% 25% 35%

Performance management 43% 11% 28% 57% 68%

Recruitment 47% 26% 34% 58% 64%

Remuneration / compensation & benefits 33% 7% 16% 43% 61%

Rewards & recognition 36% 8% 18% 47% 63%

Rostering / time & attendance 16% 5% 11% 17% 29%

Succession management 29% 4% 9% 37% 59%

Workplace health & safety (WHS) 32% 8% 20% 40% 54%

Highest value


Where does responsibility most commonly sit?


Appendix B:The general state of HR



Organisational growth and decrease plans


6%11% 7%

15% 12%

29%

7%15%

38%

45%

41%

48%44%

45%

40%

46%

56%

44%52%

37%44%

26%

52%

39%

2019 2020 2019 2020 2019 2020 2019 2020

n = 633 n = 1016 n = 618 n = 651 n = 259 n = 261 n = 1510 n = 1928


SMB (1 - 199)

Mid-Market (200 - 1999)

Enterprise (2000 +)

Overall


n = IndustryAverage % headcount

growth planned

25 Accommodation and food services 14%

15 Administrative and support services 28%

11 Agriculture, forestry and fishing 12%

6 Arts and recreation services 35%

25 Construction 19%

35 Education and training 22%

11 Electricity, gas, water and waste services 10%

61 Financial and insurance services 21%

108 Health care and social assistance 19%

56 Information media and telecommunications 23%

45 Manufacturing 14%

11 Mining 21%

82 Not for profit 14%

4 Other 30%

132 Professional, scientific and technical services 19%

36 Public administration and safety 25%

11 Rental, hiring and real estate services 14%

27 Retail trade 21%

29 Transport, postal and warehousing 23%

7 Wholesale trade 8%

737 Average overall growth rate 19%


Organisational growth rates

The average

headcount growth

rates cited in this

table are only based

on respondents who

said their

organisation intends

to grow the size of

their workforce

SMB

(1-199)

Mid-market

(200-1999)

Enterprise

(2000+)

Overall

average

2019 2020 2019 2020 2019 2020 2019 2020

Average %

headcount growth

planned

33% 21% 21% 17% 31% 13% 28% 19%

n = 356 440 323 235 113 62 792 737


n = Industry Net increase(increase – decrease)

59 Accommodation and food services 17%

45 Administrative and support services 18%

34 Agriculture, forestry and fishing 24%

27 Arts and recreation services 0%

88 Construction 9%

134 Education and training -1%

59 Electricity, gas, water and waste services -5%



118 Information media and telecommunications 30%

117 Manufacturing 27%

32 Mining 13%


126 Public administration and safety 44%

29 Rental, hiring and real estate services^ 28%

71 Retail trade 20%

64 Transport, postal and warehousing 24%

33 Wholesale trade 23%


9 Other^ 9%

25%

16%

9%

26%

24%

28%

24%

16%

7%

19%

12%

22%

12%

10%

14%

17%

19%

12%

7%

32%

51%

59%

48%

43%

46%

58%

46%

37%

33%

49%

44%

48%

61%

48%

44%

36%

67%

49%

56%

42%

33%

32%

26%

33%

26%

19%

37%

56%

48%

39%

34%

40%

29%

38%

39%

45%

21%

44%

44%



Organisational growth and decrease by industry


Organisation size n = Average no. HR professionals

1 to 49 440 1.9

50 to 99 262 1.9

100 to 149 182 2.6

150 to 199 111 2.8

200 to 499 334 4.4

500 to 999 182 9.3

1000 to 1999 108 16.2

2000 to 4999 91 40.2

5000 to 9999 69 54.7

10000+ 73 188.4

Average overall 1852 15.2

Average number of HR professionals in organisation


n = 1162

Top 327%

21%17%17%17%

16%16%

15%15%14%14%14%

13%13%

13%13%12%

10%8%

3%15%

Accommodation and food services

Retail trade

Administrative and Support Services^

Health care and social assistance

Not-for-profit

Information media and telecommunications

Construction

Financial and insurance services

Arts and Recreation Services^

Education and training

Professional, scientific and technical services

Mining^

Transport, postal and warehousing

Public administration and safety

Manufacturing

Electricity, gas, water and waste services

Rental, Hiring and Real Estate Services^

Wholesale trade^

Agriculture, forestry and fishing^

Other^

A / NZ Overall

Average turnover rate by industry


Average turnover rates

Organisation size n=Average turnover

rate 2019n=

Average turnover rate 2020

SMB(1 to 199)

439 16% 589 14%

Mid-market(200-1999)

408 17% 444 16%

Enterprise(2000+)

139 17% 129 18%

Overall 986 17% 1162 15%


69%

78%

65%

59%

54%

51%

53%

35%

41%

51%

46%

48%

39%

27%

21%

20%

9%

14%

17%

21%

23%

19%

32%

25%

15%

19%

16%

19%

23%

22%

2%

4%

7%

7%

9%

10%

11%

11%

11%

7%

11%

9%

11%

15%

16%

2%

2%

5%

4%

8%

5%

8%

9%

10%

6%

6%

8%

10%

12%

14%

4%

4%

7%

7%

5%

6%

7%

9%

8%

15%

14%

12%

14%

13%

17%

2%

4%

3%

5%

4%

4%

3%

5%

4%

7%

5%

7%

7%

9%

11%


Payroll

Recruitment



Onboarding


Employee wellness programs

Learning management


HR surveys



Workforce planning


Which of the following stages best describes your organisation's current state

of HR & payroll technology?

Fully implemented Currently implementing Less than 12 months away More than 12 months away Not considering at all I don't know

n = 1570+

Current state of HR & payroll technology


n = 1570 296 402 463 408 1337 233 844 533 192

% of respondents who have HR technology fully implemented:

OverallJunior to mid-level

Mid-levelmanagement

Seniormanagement

C-suiteleaders

Australia New ZealandSMB Mid-market Enterprise

(1 - 199) (200 - 1999) (2000+)

Communication / collaboration platforms 69% 71% 66% 71% 70% 70% 66% 64% 77% 71%


54% 56% 52% 54% 55% 55% 50% 52% 56% 59%

Employee wellness programs 35% 39% 32% 34% 35% 35% 35% 30% 36% 52%

HR surveys 46% 47% 48% 43% 45% 47% 40% 36% 57% 55%

Learning management 41% 45% 42% 41% 38% 41% 39% 32% 46% 67%

Onboarding 51% 55% 51% 52% 48% 53% 44% 49% 54% 56%

Payroll 78% 74% 74% 80% 81% 77% 79% 76% 80% 77%

Performance management 53% 57% 50% 51% 53% 53% 49% 49% 54% 65%

Recruitment 65% 70% 62% 65% 64% 65% 63% 58% 72% 75%

Remuneration / compensation & benefits 48% 46% 45% 47% 51% 47% 51% 45% 49% 56%

Rewards & recognition 39% 41% 35% 37% 42% 39% 38% 37% 38% 48%

Rostering / time & attendance 51% 49% 49% 50% 55% 51% 50% 49% 50% 61%

Succession management 21% 21% 15% 22% 25% 21% 20% 21% 18% 29%

Workforce planning 27% 26% 25% 27% 31% 27% 32% 27% 23% 40%

Workplace health & safety (WHS) 59% 57% 58% 60% 61% 59% 61% 57% 60% 67%

Highest value


Percentage who have fully implemented HR technology


Projected levels of fully implemented technology


n = 1570+

77

* The projection of fully implemented technology in 2021 is based on the combination of respondents:

• With fully implemented technology in 2020.

• Who are currently implementing their technology.

• Who said their fully implemented technology is less than 12 months away. N

/A

49

%

26

%

40

%

32

%

35

%

73

%

37

%

48

%

32

%

25

%

73

%

15

%

18

%

41

%

69

%

54

%

35

%

46

%

41

% 51

%

78

%

53

%

65

%

48

%

39

%

51

%

21

% 27

%

59

%

92

%

84

%

77

%

75

%

78

% 84

% 90

%

82

%

86

%

72

%

69

%

72

%

59

% 66

%

84

%

2019 (Fully implemented) 2020 (Fully implemented) * 2021 (Projection of fully implemented)


77%

58%

26%

15%

11%

8%

6%

4%

3%

1%

1%

1%

Microsoft Teams

Zoom

Skype for Business

Yammer

Slack

Google Hangouts

Other

Jabber

Webex

Workplace

SharePoint

Trello

What connection / collaboration platform(s) is your

organisation currently using or implementing?

n = 1387n = 1393

Connection and collaboration

22%

26%49%

3%

Did your organisation implement or decide to increase

investment into your connection / collaboration platform(s)

in response to COVID-19?

Yes, we implemented this type of technology in response to COVID-19

Yes, we increased investment in this type of technology in response to COVID-19

No, we were already in the process of implementing or considering it prior to March 2020

I don't know


50%

55%

34%

43%

31%

33%

24%

31%

25%

29%

30%

20%

24%

29%

17%

15%

7%

37%

29%

44%

35%

44%

36%

44%

37%

42%

37%

34%

40%

36%

31%

41%

39%

22%

9%

10%

18%

15%

17%

18%

24%

23%

23%

24%

21%

26%

24%

24%

29%

32%

41%

4%

6%

4%

8%

7%

13%

8%

9%

10%

11%

15%

14%

16%

16%

13%

13%

30%

Employee wellness

Compliance







Workforce planning

Recruitment


Onboarding





Offboarding

Priority Level

High Medium Low Not a priority n = 1435+

Priorities over the next 12 months


Average n = 1448 267 375 428 377 1232 216 779 492 176

% of organisations placing high or medium priority on these areas of HR:


Mid-level management

Senior management

C-suite leaders


SMB Mid-market Enterprise

(1 - 199) (200 - 1999) (2000+)


Compliance 84% 86% 88% 85% 78% 84% 82% 81% 88% 87%

Diversity & inclusion 68% 73% 77% 63% 61% 69% 62% 61% 72% 86%

Employee wellness 87% 87% 90% 87% 84% 87% 86% 84% 90% 93%

HR reporting & analytics 68% 74% 69% 68% 62% 69% 64% 57% 79% 83%

HR technology implementation or consolidation 60% 62% 62% 61% 56% 61% 53% 53% 68% 68%

Infrastructure to better support remote working 60% 62% 67% 56% 56% 61% 56% 59% 59% 68%

Learning & development 78% 78% 75% 79% 79% 78% 81% 77% 81% 75%

Managing a remote workforce 64% 67% 69% 62% 57% 65% 56% 60% 66% 70%

Offboarding 29% 36% 33% 24% 27% 29% 30% 26% 34% 31%

Onboarding 60% 67% 60% 61% 56% 60% 63% 57% 66% 58%


Recruitment 66% 69% 67% 67% 61% 66% 65% 62% 70% 69%





Highest value


High and medium priorities for the next 12 months


26%

34%

34%

40%

16%

21%

17%

29%

22%

34%

18%

19%

19%

31%

16%

16%

8%

43%

34%

32%

24%

48%

42%

47%

34%

41%

28%

42%

41%

41%

28%

43%

41%

46%

4%

5%

6%

3%

6%

5%

7%

14%

14%

5%

13%

6%

15%

3%

5%

5%

7%

5%

6%

8%

9%

10%

6%

9%

4%

4%

7%

6%

13%

5%

13%

11%

14%

15%

22%

20%

20%

24%

20%

25%

21%

19%

19%

26%

21%

21%

21%

24%

24%

24%

24%


Employee wellness




Compliance

Onboarding


Recruitment






Workforce planning


Offboarding

HR Budget

Increased from last year Same as last year Decreased from last year No budget allocated this year I don't know n = 905+

Budgets over the next 12 months


n = 1100 201 297 330 273 948 152 577 392 131

Does your organisation have budget allocated to these priorities over the next 12 months?


Mid-levelmanagement

Seniormanagement

C-suite leaders


(1 - 199) (200 - 1999) (2000+)


Compliance 69% 41% 60% 79% 86% 69% 67% 73% 68% 51%




HR technology implementation or consolidation 72% 49% 67% 83% 83% 72% 72% 73% 77% 56%

Infrastructure to better support remote working 67% 48% 61% 72% 82% 67% 68% 71% 67% 51%


Managing a remote workforce 62% 43% 55% 70% 76% 62% 61% 67% 60% 50%

Offboarding 61% 40% 53% 69% 75% 62% 54% 63% 63% 43%

Onboarding 71% 48% 63% 80% 85% 71% 66% 73% 72% 57%


Recruitment 77% 52% 70% 88% 92% 77% 77% 80% 78% 63%





Highest value


Has budget allocated (regardless of priority level)


Priorities vs budgets over the next 12 months

42%

33%

19%

23%

28%

38%

5%

5%

6%

23%

27%

27%

6%

7%

10%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty


Increased from last year Same as last year Decreased from last year I don't know No budget allocated this year

27%

15%

10%

39%

46%

52%

3%

8%

7%

26%

27%

21%

5%

5%

11%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty

Compliance


32%

10%

3%

32%

46%

45%

4%

6%

6%

26%

26%

18%

5%

12%

29%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty





45%

25%

11%

28%

41%

40%

4%

6%

9%

19%

21%

20%

3%

7%

19%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty

Employee wellness


34%

17%

7%

31%

43%

46%

4%

6%

7%

23%

21%

20%

7%

13%

20%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty



52%

34%

13%

21%

33%

44%

3%

6%

9%

19%

21%

19%

5%

6%

14%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty





53%

43%

25%

14%

24%

33%

3%

3%

3%

24%

22%

25%

6%

9%

13%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty



44%

24%

13%

29%

37%

37%

9%

14%

23%

15%

21%

21%

3%

4%

6%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty



44%

28%

17%

22%

30%

34%

2%

4%

3%

23%

25%

26%

9%

13%

20%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty





24%

9%

5%

39%

50%

44%

7%

7%

6%

26%

21%

25%

3%

12%

19%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty

Offboarding


32%

14%

8%

36%

49%

54%

5%

7%

8%

21%

21%

20%

6%

9%

11%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty

Onboarding


28%

12%

4%

43%

50%

52%

4%

6%

8%

16%

22%

24%

9%

9%

12%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty





39%

18%

8%

33%

43%

49%

10%

12%

21%

16%

22%

18%

2%

4%

4%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty

Recruitment


32%

21%

10%

37%

39%

44%

11%

14%

18%

17%

22%

21%

3%

4%

7%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty



37%

18%

8%

37%

42%

46%

10%

11%

16%

12%

23%

23%

4%

6%

6%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty





30%

13%

6%

38%

44%

47%

4%

5%

7%

21%

27%

23%

7%

11%

16%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty

Workforce planning


36%

21%

10%

38%

47%

52%

4%

3%

8%

19%

25%

23%

4%

4%

7%

High priority

Medium priority

Low priority

Budget

Pri

ori

ty




71%

30%

25%

24%

23%

23%

18%

16%

16%

11%

10%

10%

9%

8%

6%

74%

31%

27%

19%

33%

21%

21%

12%

23%

N/A

7%

8%

7%

N/A

N/A

General admin work

Operations management


Workforce management (rostering / time & attendance)

Recruiting and executive search


Driving and managing organisational culture / behaviour

Meeting with senior leaders / business partners

Onboarding / induction


Other

Employee engagement

Learning & development (L&D)

Developing HR strategy

Employee wellness

Please select the top three areas that you believe to be taking up too much of HR's time in your organisation,

relative to the value they deliver:

2020 (n = 1251)

2019 (n = 1053)

Top 3



n = 1251 221 324 374 332 1081 170 678 430 143

Please select the top three areas that you believe to be taking up too much of HR's time in your organisation, relative to the value they deliver:

OverallJunior to Mid-level

Mid-levelmanagement

Seniormanagement

C-suiteleaders


(1 - 199) (200 - 1999) (2000+)

Developing HR strategy 8% 8% 12% 6% 8% 8% 13% 9% 6% 9%

Driving and managing organisational culture / behaviour 18% 23% 18% 20% 14% 18% 21% 18% 19% 17%

Employee engagement 10% 8% 9% 11% 9% 10% 10% 11% 7% 10%


General admin work 71% 76% 69% 72% 70% 72% 69% 70% 74% 69%

Industrial / employee relations 23% 16% 23% 24% 26% 22% 26% 19% 27% 29%

Learning & development (L&D) 9% 9% 7% 7% 11% 9% 5% 10% 7% 5%

Meeting with senior leaders / business partners 16% 19% 18% 17% 12% 17% 15% 16% 14% 24%

Offboarding / standing down 11% 14% 11% 10% 12% 11% 12% 9% 13% 15%

Onboarding / induction 16% 19% 17% 16% 14% 16% 17% 16% 18% 12%

Operations management 30% 29% 23% 33% 34% 30% 26% 31% 29% 28%


Recruiting and executive search 23% 22% 25% 23% 23% 23% 24% 26% 23% 13%

Workforce management (rostering / time & attendance) 24% 19% 25% 22% 27% 24% 22% 22% 25% 25%

Highest value




26%

26%

23%

22%

22%

20%

20%

19%

17%

16%

16%

13%

13%

12%

12%

11%

6%

3%

2%

26%

37%

N/A

34%

30%

30%

28%

23%

N/A

19%

16%

16%

N/A

N/A

18%

16%

6%

N/A

3%

Upskilling, cross-skilling or reskilling employees

Leadership development

Increase in remote working

Cultural change

Change management

Upgrading technology

Lack of resources

Automating administrative tasks

Employee wellness

Low employee engagement

Boosting productivity

Succession planning

Recruitment


Rapid growth

High employee turnover



Other


2020 (n = 1240)

2019 (n = 1043)

Top 3



n = 1240 217 320 372 331 1070 170 671 427 142



Mid-levelmanagement

Seniormanagement

C-suiteleaders


(1 - 199) (200 - 1999) (2000+)

Automating administrative tasks 19% 16% 17% 21% 22% 20% 14% 21% 19% 15%

Boosting productivity 16% 7% 14% 18% 21% 15% 24% 20% 11% 11%

Change management 22% 23% 21% 21% 23% 21% 24% 20% 25% 19%

Cultural change 22% 21% 21% 23% 23% 22% 21% 21% 22% 23%



High employee turnover 11% 13% 12% 12% 9% 12% 10% 9% 13% 17%

Increase in remote working 23% 23% 28% 20% 22% 24% 20% 23% 22% 28%

Lack of resources 20% 16% 21% 21% 20% 19% 22% 20% 18% 25%

Leadership development 26% 22% 25% 31% 24% 26% 23% 26% 28% 20%

Low employee engagement 16% 24% 19% 15% 11% 17% 13% 15% 16% 21%

Offboarding / standing down 3% 3% 3% 3% 1% 3% 3% 3% 3% 1%


Rapid growth 12% 12% 9% 11% 17% 13% 9% 13% 13% 4%

Recruitment 13% 10% 12% 14% 13% 12% 18% 14% 10% 13%

Succession planning 13% 14% 13% 14% 11% 14% 8% 13% 13% 10%

Upgrading technology 20% 25% 18% 18% 21% 20% 21% 19% 22% 20%

Upskilling, cross-skilling or Reskilling employees 26% 29% 25% 24% 29% 26% 26% 26% 27% 26%

Highest value




41%

39%

32%

32%

32%

29%

28%

26%

25%

20%

20%

19%

19%

17%

16%

16%

13%

3%

44%

42%

N/A

36%

34%

N/A

N/A

N/A

25%

N/A

15%

22%

N/A

19%

16%

N/A

N/A

N/A

Strategic planning


Managing employee wellness

Change management

Organisational development

Workforce planning and job analysis

General business knowledge and skills

Remote workforce management

Communication and employee relations

Conflict management

Risk assessment and mitigation

Program development and implementation

Policy / procedure creation

Negotiation skills

Budget management

Policy / procedure enforcement

Problem solving

None - I don't intend to develop new skills


2020 (Resp. 1533)

2019 (Resp. 1207)

Top 3

Which skill(s) are you aiming to develop for yourself?


n = 1533 291 395 455 392 1302 231 822 524 187




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Budget management 16% 12% 16% 17% 19% 17% 14% 20% 12% 12%

Change management 32% 34% 38% 30% 26% 31% 33% 30% 32% 36%

Communication and employee relations 25% 42% 27% 18% 17% 24% 28% 26% 24% 21%

Conflict management 20% 32% 25% 16% 13% 20% 23% 22% 18% 21%

General business knowledge and skills 28% 38% 29% 22% 26% 28% 30% 29% 27% 25%


Managing employee wellness 32% 34% 35% 33% 29% 33% 32% 36% 31% 22%

Negotiation skills 17% 27% 19% 12% 12% 17% 13% 16% 17% 19%

Organisational development 32% 32% 35% 30% 30% 31% 33% 32% 32% 30%

Policy / procedure creation 19% 29% 19% 15% 16% 19% 19% 22% 16% 13%

Policy / procedure enforcement 16% 23% 17% 14% 13% 16% 16% 20% 12% 9%

Problem solving 13% 27% 17% 7% 7% 13% 14% 13% 12% 18%

Program development and implementation 19% 29% 23% 14% 14% 19% 18% 19% 19% 18%

Remote workforce management 26% 22% 27% 29% 27% 27% 24% 28% 26% 23%

Risk assessment and mitigation 20% 15% 20% 20% 23% 20% 20% 23% 15% 16%

Strategic planning 41% 34% 43% 43% 42% 42% 38% 42% 43% 35%

Workforce planning and job analysis 29% 30% 33% 28% 25% 30% 22% 28% 31% 27%

None - I don't intend to develop new skills 3% 1% 3% 3% 6% 3% 3% 4% 2% 3%

Highest value


Which skill(s) are you aiming to develop for yourself?



80%

72%

70%

57%

50%

49%

41%

41%

39%

39%

35%

29%

29%

26%

25%

3%

0%

Flexible start / finish times

Part-time work

Leave without pay

Time-in-lieu

Work from home sporadically

Work from home 1-2 days a week

Parental leave (above statutory requirements)

Working from other locations

Work from home 3 or more days a week

Swapping workdays (if part-time)

Compressed days (e.g. working longer hours per day to accumulate more time on other days)

Purchased leave

Job sharing

Rostered days off (RDO)

Career breaks (unrelated to parental leave)

Our organisation doesn't offer flexible working options

I don't know


n = 1218



n = 1218 212 315 363 328 1053 165 656 422 140




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Career breaks (unrelated to parental leave) 25% 24% 26% 26% 22% 26% 17% 18% 28% 46%

Compressed days 35% 34% 36% 36% 34% 35% 34% 29% 42% 43%

Flexible start / finish times 80% 76% 79% 80% 85% 80% 82% 79% 82% 86%

Job sharing 29% 29% 29% 30% 27% 30% 19% 21% 32% 56%

Leave without pay 70% 68% 69% 72% 69% 70% 66% 62% 80% 76%

Our organisation doesn't offer flexible working options 3% 2% 4% 3% 2% 3% 4% 4% 2% 1%

Parental leave (above statutory requirements) 41% 42% 46% 38% 39% 44% 22% 32% 50% 61%

Part-time work 72% 73% 69% 74% 72% 72% 68% 66% 79% 75%

Purchased leave 29% 36% 32% 28% 22% 30% 19% 18% 37% 55%

Rostered days off (RDO) 26% 28% 28% 25% 24% 27% 19% 18% 33% 42%

Swapping workdays (if part-time) 39% 33% 39% 41% 41% 41% 25% 39% 37% 44%

Time-in-lieu 57% 50% 59% 60% 56% 58% 48% 51% 64% 60%

Work from home 1-2 days a week 49% 47% 47% 54% 46% 49% 48% 46% 54% 49%

Work from home 3 or more days a week 39% 37% 38% 40% 41% 41% 32% 36% 40% 53%

Work from home sporadically 50% 47% 50% 53% 48% 50% 51% 44% 56% 61%

Working from other locations 41% 41% 38% 42% 44% 41% 42% 35% 46% 56%

I don't know 0% 0% 1% 0% 0% 0% 1% 0% 0% 1%

Highest value




n = 1202

39%

37%

35%

29%

29%

28%

27%

27%

26%

23%

20%

15%

9%

9%

5%

2%

Getting consistency across all managers to allow flexible work options within their own team


Operational issues related to flexible work options

Negative stigma associated with working from home

Reduction (perceived or actual) in productivity resulting from flexible work options

Convincing top-level management of the benefits of flexible work options

Measuring the use and / or success of flexible work options

Creating equal opportunities for staff who want or need flexible work options

Demonstrating the return on investment (ROI) of flexible work options

Issues with employees misusing or abusing flexible work privileges


The creation of online communities and support networks for remote workers

Lack of flexible work options to attract talent and / or retain staff

Increasing staff awareness about their flexible work options


I don't know




n = 1218 212 315 363 328 1053 165 656 422 140



Mid-level mgmt.

Senior mgmt.

C-suite leaders

AustraliaNew

Zealand

SMBMid-

marketEnterprise

(1 - 199) (200 - 1999) (2000+)

Convincing top-level management of the benefits of flexible work options 28% 31% 32% 30% 22% 28% 29% 26% 31% 32%

Creating equal opportunities for staff who want or need flexible work options 27% 29% 32% 25% 21% 26% 28% 24% 28% 34%


20% 15% 24% 24% 17% 20% 21% 17% 23% 28%

Demonstrating the return on investment (ROI) of flexible work options 26% 24% 26% 26% 26% 26% 23% 22% 28% 33%

Getting consistency across all managers to allow flexible work options within their own team 39% 47% 43% 39% 30% 39% 42% 29% 47% 64%

Increasing staff awareness about their flexible work options 9% 14% 9% 6% 7% 9% 7% 6% 11% 14%

Issues with employees misusing or abusing flexible work privileges 23% 21% 26% 21% 23% 23% 20% 24% 21% 23%

Lack of flexible work options to attract talent and / or retain staff 9% 12% 12% 9% 6% 9% 9% 8% 11% 12%


37% 37% 41% 35% 36% 37% 40% 38% 36% 38%

Measuring the use and / or success of flexible work options 27% 19% 30% 30% 26% 27% 28% 26% 28% 30%

Negative stigma associated with working from home 29% 35% 36% 26% 23% 29% 31% 25% 33% 37%

Operational issues related to flexible work options 35% 30% 36% 39% 31% 34% 36% 31% 39% 37%

Reduction (perceived or actual) in productivity resulting from flexible work options 29% 25% 32% 30% 29% 30% 25% 27% 31% 32%

The creation of online communities and support networks for remote workers 15% 14% 17% 15% 15% 16% 9% 13% 17% 22%

None - we have no challenges 5% 2% 3% 4% 10% 5% 2% 8% 2% 1%

I don't know 2% 3% 2% 0% 2% 1% 3% 2% 1% 2%

Highest value




n = 1194

76%

25%

24%

24%

24%

23%

17%

11%

1%

Employee assistance programs


Mental health day(s) / programs

Gym memberships / subsidies

Access to a wellbeing application

Health insurance coverage / subsidies

Yoga / meditation

None - we have no wellbeing initiatives

I don't know




n = 1194 209 308 359 318 1032 162 642 416 136




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Access to a wellbeing application 24% 28% 22% 20% 26% 25% 17% 19% 26% 40%


25% 27% 24% 22% 30% 26% 21% 22% 29% 32%

Employee assistance programs 76% 83% 81% 77% 67% 76% 76% 65% 88% 94%

Gym memberships / subsidies 24% 29% 28% 24% 17% 24% 20% 18% 27% 42%

Health insurance coverage / subsidies 23% 28% 24% 21% 20% 20% 43% 13% 30% 45%

Mental health day(s) / programs 24% 26% 22% 23% 26% 25% 18% 21% 26% 32%

Yoga / meditation 17% 18% 20% 15% 17% 18% 14% 13% 21% 24%

None - we have no wellbeing initiatives 11% 10% 7% 12% 14% 11% 10% 17% 4% 1%

I don't know 1% 1% 1% 1% 2% 1% 2% 2% 0% 1%

Highest value



39%

35%

32%

23%

19%

18%

15%

12%

11%

10%

9%

8%

8%

7%

6%

6%

3%

45%

42%

N/A

22%

20%

24%

19%

14%

16%

11%

11%

13%

19%

8%

6%

8%

11%

Employee turnover

Employee engagement


Employee absenteeism

Length of service

Time to hire

HR complaints

Diversity & inclusion targets

Cost to hire

Employee Net Promoter Score (eNPS®^)

Pay equity

Customer satisfaction score (other than NPS®^)

I don't know

HR-to-employee ratio

Customer Net Promoter Score (NPS®^)

Cost of HR per employee

Other


2020 (n = 1169)

2019 (n = 1010)



n = 1169 205 298 354 312 1012 157 624 410 135




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Cost of HR per employee 6% 2% 5% 8% 6% 6% 3% 4% 8% 11%

Cost to hire 11% 9% 9% 14% 13% 12% 8% 9% 15% 12%

Customer Net Promoter Score (NPS®) 6% 5% 8% 5% 7% 6% 4% 6% 7% 6%

Customer satisfaction score (other than NPS®) 8% 5% 9% 8% 10% 9% 7% 9% 7% 8%

Diversity & inclusion targets 12% 11% 14% 13% 12% 13% 8% 7% 15% 27%

Employee absenteeism 23% 17% 19% 27% 27% 24% 19% 20% 26% 25%

Employee engagement 35% 29% 33% 36% 41% 36% 29% 32% 39% 38%

Employee Net Promoter Score (NPS®) 10% 7% 9% 12% 11% 10% 7% 9% 11% 12%

Employee turnover 39% 35% 33% 43% 43% 40% 32% 34% 46% 40%

HR complaints 15% 9% 17% 15% 15% 16% 7% 12% 18% 18%

HR-to-employee ratio 7% 3% 3% 11% 8% 8% 2% 4% 10% 13%

Length of service 19% 21% 15% 20% 22% 20% 17% 18% 23% 15%

Pay equity 9% 4% 10% 10% 10% 9% 9% 8% 10% 10%

Time to hire 18% 16% 16% 19% 18% 18% 14% 11% 24% 26%


32% 29% 31% 32% 35% 32% 36% 39% 28% 13%

I don't know 8% 22% 10% 4% 2% 8% 12% 7% 7% 19%

Highest value





None: We don't use HR metrics at all





I don't know



3% 3% 6% 4% 6%11%

5% 4%2%

2% 2%

5%

2% 2%4% 3%5% 8%

8%

8%

5% 5%

29%22%

35% 32%

42%35%

34%27%

44%

42%

40%43%

37% 36%

41%

42%

19%28%

11% 12%4% 5%

13%20%

2019 2020 2019 2020 2019 2020 2019 2020

n = 418 n = 622 n = 425 n = 409 n = 163 n = 133 n = 1006 n = 1164

SMB (1 - 199) Mid-market (200 - 1999) Enterprise (2000+) OverallSMB (1 - 199)

Mid-Market (200 - 1999)

Enterprise (2000 +)

Overall


n = 1164 203 298 351 312 1009 155 622 409 133




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

None: We don't use HR metrics at all 20% 19% 17% 21% 22% 19% 26% 28% 12% 5%


42% 37% 46% 42% 41% 42% 37% 42% 43% 36%


27% 25% 27% 28% 28% 27% 24% 22% 32% 35%


5% 5% 6% 6% 4% 5% 5% 3% 8% 8%


2% 2% 1% 1% 3% 2% 1% 2% 1% 5%

I don't know 4% 12% 4% 3% 2% 4% 8% 3% 4% 11%

Highest value





43%

42%

40%

39%

34%

31%

30%

28%

26%

25%

22%

19%

19%

18%

8%

8%

5%

4%

52%

51%

39%

43%

37%

25%

22%

30%

26%

36%

23%

N/A

20%

23%

11%

N/A

6%

6%

Recruitment






Employee wellness

Payroll

Onboarding



Communication / collaboration





I don't know



2020 (n = 863)

2019 (n = 803)




n = Has fully implemented technology Does not have fully implemented technology

Payroll 239 87% 13%

Communication / collaboration 165 81% 19%

Recruitment 369 77% 23%

Rostering / time & attendance 165 77% 23%

Workplace health & safety (WHS) 366 72% 28%

Rewards & recognition 156 69% 31%

Onboarding 224 67% 33%

Performance management 334 66% 34%

Remuneration / compensation & benefits 219 61% 39%

Succession management 66 59% 41%

Employee wellness 255 54% 46%

Highest value




n = 863 138 230 267 228 760 103 416 336 111




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Communication / collaboration 19% 15% 21% 18% 21% 20% 13% 20% 17% 21%



Industrial / employee relations 22% 23% 20% 22% 22% 22% 21% 15% 25% 36%


Onboarding 26% 28% 25% 27% 24% 27% 18% 27% 26% 23%

Organisational culture 34% 30% 32% 34% 38% 34% 35% 32% 37% 32%

Organisational design 4% 7% 3% 4% 5% 5% 3% 4% 4% 6%

Payroll 28% 28% 22% 32% 29% 27% 31% 27% 27% 32%


Recruitment 43% 45% 39% 46% 41% 43% 41% 36% 49% 50%



Rostering / time & attendance 19% 14% 17% 22% 21% 19% 20% 19% 18% 23%

Succession management 8% 7% 7% 6% 10% 8% 8% 6% 8% 13%



8% 5% 7% 7% 11% 7% 10% 9% 7% 3%

I don't know 5% 13% 6% 2% 2% 5% 5% 3% 5% 11%

Highest value



62%

59%

26%

19%

18%

17%

15%

7%

4%

3%

62%

61%

27%

18%

21%

17%

16%

7%

3%

2%

Employee survey feedback

Manual processes (e.g. paper-based processes or use of spreadsheets)

Integrated HRIS platform

Stand-alone HR technology platform

System developed in-house

Third-party reporting tool(s) / analytics platform(s)

Third-party aggregator (e.g. LinkedIn, Seek or review sites)

Enterprise resource planning (ERP) platform(s)

None - we have no tool

I don't know

Which tool(s) does your organisation currently use to gather and report on HR metrics?

2020 (n = 858)

2019 (n = 796)

Tools used to gather HR metrics


n = 858 138 229 266 225 756 102 414 333 111

Which tool(s) does your organisation currently use to gather and report on HR metrics?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Employee survey feedback 62% 59% 62% 61% 66% 63% 61% 56% 69% 66%

Enterprise resource planning (ERP) platform(s)

7% 7% 7% 4% 11% 7% 6% 6% 7% 10%

Integrated HRIS platform 26% 28% 30% 23% 22% 27% 15% 18% 31% 36%

Manual processes (e.g. paper-based processes or use of spreadsheets)

59% 61% 52% 66% 58% 59% 61% 58% 66% 45%

Stand-alone HR technology platform 19% 22% 16% 19% 21% 20% 17% 19% 21% 16%

System developed in-house 18% 14% 20% 16% 22% 18% 20% 15% 17% 32%

Third-party aggregator (e.g. LinkedIn, Seek or review sites)

15% 12% 13% 16% 17% 15% 10% 13% 17% 17%

Third-party reporting tool(s) / analytics platform(s)

17% 17% 18% 15% 18% 17% 19% 16% 17% 23%

None - we have no tool 4% 4% 4% 4% 4% 4% 3% 6% 2% 2%

I don't know 3% 7% 4% 2% 1% 3% 7% 2% 3% 9%

Highest value


Tools used to gather HR metrics


56%

55%

54%

42%

42%

41%

35%

35%

32%

31%

8%

6%

47%

55%

47%

36%

47%

38%

33%

35%

26%

30%

13%

7%


Lack of technological infrastructure

Identifying value-add HR metrics

Subjectivity of HR measurement

Obtaining raw data


Assigning accountability for metrics

Making metrics information available

Linking incentives with HR metrics

Lack of skills among HR staff

I don't know


What are the top five challenges you have faced / are facing when trying to implement HR metrics within

your organisation?

2020 (n = 809)

2019 (n = 955)



n = 809 128 216 249 216 711 98 381 323 105

What are the top five challenges you have faced / are facing when trying to implement HR metrics within your organisation?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Assigning accountability for metrics 35% 39% 34% 34% 37% 36% 34% 35% 35% 37%


56% 50% 61% 57% 53% 56% 55% 54% 57% 55%

Identifying value-add HR metrics 54% 48% 53% 58% 55% 54% 56% 53% 57% 50%


41% 38% 44% 43% 38% 41% 41% 37% 41% 54%

Lack of skills among HR staff 31% 27% 31% 31% 35% 33% 21% 28% 32% 44%

Lack of technological infrastructure 55% 55% 49% 63% 54% 56% 48% 52% 60% 51%

Linking incentives with HR metrics 32% 30% 32% 30% 36% 32% 32% 36% 30% 21%

Making metrics information available 35% 34% 36% 31% 39% 35% 38% 31% 39% 36%

Obtaining raw data 42% 36% 39% 46% 44% 42% 42% 41% 45% 36%

Subjectivity of HR measurement 42% 34% 38% 46% 46% 41% 46% 46% 37% 43%


I don't know 8% 17% 10% 5% 3% 7% 10% 8% 7% 9%

Highest value





Do you have a formal process in place to measure employee engagement?

48%42%

67% 69%

81%

67%61%

54%

48%53%

30% 29%11%

21% 35%41%

5% 5% 3% 3%8% 12%

5% 5%

2019 2020 2019 2020 2019 2020 2019 2020

n = 398 n = 597 n = 407 n = 391 n = 151 n = 127 n= 956 n= 1115

SMB (1 - 199) Mid-market (200 - 1999) Enterprise (2000+) Overall

Yes No I don't know

SMB (1 - 199)

Mid-Market (200 - 1999)

Enterprise (2000 +)

Overall



81%

65%

53%

40%

30%

18%

9%

0%

85%

66%

43%

35%

27%

16%

8%

1%

Engagement surveys

Exit surveys

Pulse surveys

One-on-one meetings with employees

Onboarding surveys

Employee Net Promoter Score (eNPS®)

Stay surveys

I don't know


2020 (n = 600)

2019 (n = 578)



n = 600 95 147 194 164 524 76 250 265 85




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Pulse surveys 53% 58% 54% 47% 57% 53% 55% 46% 57% 61%

Engagement surveys 81% 79% 80% 85% 80% 82% 79% 77% 86% 80%

Stay surveys 9% 6% 9% 9% 10% 9% 5% 8% 11% 6%

Onboarding surveys 30% 35% 28% 27% 34% 31% 24% 32% 29% 29%

Exit surveys 65% 67% 66% 62% 66% 66% 59% 68% 68% 47%

One-on-one meetings with employees 40% 35% 37% 38% 48% 40% 42% 54% 31% 29%

Employee Net Promoter Score (eNPS®) 18% 15% 12% 19% 23% 17% 22% 18% 20% 13%

I don't know 0% 1% 0% 0% 0% 0% 1% 0% 0% 0%

Highest value





24%

23%

21%

19%

17%

14%

11%

8%

4%

14%

26%

25%

21%

26%

14%

21%

6%

7%



Too busy to implement / no resources

We don't have the budget




I don't know



2020 (n = 448)

2019 (n = 318)

Why don’t you measure employee engagement?


n = 448 74 113 139 122 386 62 309 113 26




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

We don't have the budget 19% 22% 26% 17% 14% 19% 16% 18% 19% 31%


23% 34% 22% 30% 11% 23% 23% 23% 19% 38%


24% 9% 15% 25% 39% 23% 29% 33% 4% 0%


17% 15% 19% 20% 13% 18% 13% 13% 30% 12%


4% 3% 3% 4% 6% 4% 5% 5% 2% 4%


11% 11% 11% 14% 9% 11% 13% 12% 11% 8%


14% 9% 14% 13% 19% 14% 16% 15% 16% 4%

Too busy to implement / no resources 21% 22% 27% 18% 20% 22% 16% 18% 27% 31%

I don't know 8% 24% 6% 6% 4% 8% 10% 7% 12% 12%

Highest value


Why don’t you measure employee engagement?


49%

44%

29%

19%

12%

3%

53%

42%

32%

17%

14%

3%

Spreadsheets

Stand-alone payroll system

Integrated HR & payroll system

Integrated HR system (excluding payroll)

Multiple stand-alone, best-of-breed HR systems

I don't know

Thinking about the entire HR function, how does your organisation manage its employee data?

2020 (n = 1099)

2019 (n = 934)

How does HR manage employee data?


Highest value


How does HR manage employee data?

n = 1099 192 275 339 293 953 146 590 386 123

Thinking about the entire HR function, how does your organisation manage its employee data?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Spreadsheets 49% 45% 46% 51% 52% 49% 48% 49% 53% 33%

Multiple stand-alone, best-of-breed HR systems

12% 13% 12% 12% 11% 12% 11% 9% 15% 15%

Integrated HR system (excluding payroll) 19% 26% 21% 14% 19% 19% 19% 15% 23% 28%

Integrated HR & payroll system 29% 34% 33% 31% 21% 30% 23% 24% 33% 44%

Stand-alone payroll system 44% 38% 39% 47% 51% 43% 53% 49% 41% 28%

I don't know 3% 5% 4% 1% 3% 3% 6% 3% 2% 8%


Appendix C:Recruitment



Recruitment as a priority

Summary:

Compared to results from the 2019 survey, there was a significant reduction in the priority given to recruitment because fewer organisations intended to grow their workforce. In 2019, three-

quarters of respondents (75%) said recruitment was a high or medium priority for their organisation, in comparison to only two thirds of respondents (66%) in 2020.

Insight:

When analysed in conjunction with the question about organisations’ intentions to increase the size of their workforces, it is clear how extensively COVID-19 hindered workforce expansion

across Australia and New Zealand.

Action:

● Regardless of whether hiring was frozen, continued with few changes, or escalated in 2020, employers have been dealing with a new, uncharted business environment. Time should

be taken to align workforce planning strategies with the broader business plans. As these business plans will constantly be course-correcting to deal with the aftershocks of COVID-19,

any workforce strategies must also be adaptable.

75%66%

52%

39%

2019 2020

% who said recruitment was a hght or medium priority for their organisation

% intending to increase workforce


47%

42%

31%

27%

25%

25%

19%

17%

6%

1%

52%

49%

34%

31%

35%

33%

21%

20%

2%

1%

Competition for talent

Skills shortage

Building a stronger employer brand

Slow decision making / too many stakeholders

A manual or inefficient recruitment process

Reducing the time to hire

Creating a positive candidate experience

Lack of HR resources


I don't know


2020 (n = 908)

2019 (n = 762)

Key recruitment challenges



Summary:

The results for this question indicate that respondents found all recruitment-related issues / activities less challenging in 2020 than they did in 2019. The order in which the challenges were ranked remained the same. Several developments are worthy of mention. Firstly, those selecting ‘manual or inefficient recruitment processes’ as a challenge dropped by 10 percentage points from 2019. Secondly, roughly one third of respondents said they were challenged by ‘building their employer brand’ and one fifth said they were challenged by ‘creating a positive candidate experience’. These challenges speak to how important it is to engage with and inspire candidates. It indicates that having a compelling brand is important in attracting top talent.

Insight:

These are two reasons why respondents were less challenged by recruitment-specific issues and activities in 2020 than they were in 2019:

1. An increase in fully implemented technology – In 2020, two thirds of respondents had fully implemented recruitment technology, in comparison to only half of the respondents back in 2019. The increased uptake of technology was evident across all organisations, regardless of size, and it significantly reduced challenges relating to manual or inefficient recruitment processes.

2. When less recruitment is happening, naturally there are fewer challenges – Manual and inefficient processes can be improved, whereas challenges such as ‘skills shortage’, ‘competition for talent’ and ‘slow decision making / too many stakeholders’ are more complex and may require different participants to resolve them. One hypothesis is that recruitment was less of a priority across Australia and New Zealand in general, and therefore fewer of these challenges were encountered at the time the survey was conducted.

The percentage of respondents focused on ‘building a stronger employer brand’ and ‘creating a positive candidate experience’ did not change significantly from 2019. Awareness about the importance of the employer brand and the critical need to manage it has been growing in recent years. This has been evident with the rise of employer review websites like Glassdoor.

In an unexpected way, COVID-19 presented employers with an opportunity to shine by demonstrating their values and concern for employee wellbeing. Indeed, HR observer Josh Bersin stated the pandemic was “the best thing that ever happened to employee engagement” and his research indicated that “companies are looking after their employees better than ever”.

Employers may have damaged their employer brand in 2020 if they did not demonstrate care for their employees’ wellbeing, or if they made certain drastic changes to their workforce, such as job cuts and pay cuts, without considering the message it sent to their wider organisation and the talent market in general. This will be felt as the economy recovers and disengaged employees begin to leave. On the other hand, many organisations already have a respected employer brand and well-defined employee value proposition (EVP), but are keen to enhance their brand further.

Action:

● Capitalise on a buoyant candidate market. Streamlining recruitment processes through the use of technology can enhance the candidate experience and increase the time available to focus on more strategic initiatives such as employer branding and value propositions.

● Prioritising your employer brand will help to attract top talent during the recovery phase. Your EVP forms the foundation of your brand and should be emphasised at every touchpoint a candidate has with your organisation. Your employer brand should also reflect the core values and purpose of your organisation.

https://joshbersin.com/2020/04/covid-19-may-be-the-best-thing-that-ever-happened-to-employee-engagement/


Two key recruitment challenges

Summary:

The 2020 results show a significant decline in New Zealand respondents citing ‘competition for talent’ and ‘skills shortage’ as key challenges. In the 2019 report, the results showed it was much

tougher to recruit top talent and skills in New Zealand compared with Australia: Back in 2019, 2 in 3 New Zealand respondents cited these as top challenges in comparison to only 1 in 2 Australian

respondents. In 2020, New Zealand and Australian respondents were on par, with 1 in 2 respondents from each country citing the competition for talent and a skills shortage as key challenges.

Insight:

There have been fundamental changes in the talent market since the COVID-19 pandemic and the associated economic downturn hit. Compared with 12 months ago, there are more candidates

than jobs for many roles. It stands to reason that ‘competition for talent’ and ‘skills shortage’ would slip down the list of challenges. The New Zealand results reflect an additional shift in the talent

market in New Zealand. In November 2020, a survey conducted across thousands of New Zealand expats found that up to half a million New Zealanders will return to New Zealand as a result of

the COVID-19 pandemic, creating an influx of skilled candidates looking for jobs. “Currently, more of our skilled population live offshore than any other OECD country,” one expert commented.

Action:

● Regardless of your geographic location, position your organisation so that it is attractive to external candidates. Review the existing candidate experience and make adjustments so that

recruitment is seamless and fast, without cutting corners or jeopardising quality of hire.

● Review existing recruitment processes and re-assess your business strategy to ensure there is alignment between your strategic business plans and workforce planning (including talent

acquisition).

50% 47%

64%

47%46%41%

67%

49%

Australia 2019 Australia 2020 NZ 2019 NZ 2020

Competition for talent Skills shortage

https://www.tvnz.co.nz/one-news/new-zealand/up-half-million-kiwi-expats-could-return-home-in-next-few-years-escape-covid-19-survey


n = 908 128 201 307 272 793 115 524 312 72




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Creating a positive candidate experience 19% 20% 21% 18% 18% 19% 17% 14% 22% 40%

Building a stronger employer brand 31% 34% 32% 27% 33% 32% 24% 30% 33% 31%

A manual or inefficient recruitment process 25% 31% 27% 26% 20% 25% 27% 22% 28% 39%

Reducing the time to hire 25% 24% 33% 19% 26% 25% 27% 22% 26% 44%

Competition for talent 47% 47% 46% 48% 48% 47% 47% 44% 52% 53%

Skills shortage 42% 34% 42% 44% 42% 41% 49% 43% 40% 43%

Slow decision making / too many stakeholders 27% 34% 39% 24% 16% 27% 24% 23% 27% 50%

Lack of HR resources 17% 20% 19% 14% 17% 18% 11% 15% 19% 18%


I don't know 1% 4% 1% 1% 1% 1% 1% 1% 1% 3%

Highest value




Highest value



Which of the following stages best describes your organisation's current state of HR and payroll and technology for recruitment?

Has fully implemented technology Does not have fully implemented technology

What are your organisation's key recruitment challenges? Total resp. SMB Mid-market Enterprise Total resp. SMB Mid-market Enterprise

n = 600 n = 319 n = 229 n = 52 n = 308 n = 205 n = 83 n = 20

Creating a positive candidate experience 18% 14% 19% 37% 20% 14% 30% 50%

Building a stronger employer brand 31% 32% 31% 29% 30% 26% 37% 35%

A manual or inefficient recruitment process 18% 17% 17% 27% 40% 30% 58% 70%

Reducing the time to hire 26% 23% 25% 44% 24% 20% 27% 45%

Competition for talent 50% 47% 53% 52% 43% 39% 49% 55%

Skills shortage 43% 43% 41% 50% 39% 41% 36% 25%

Slow decision making / too many stakeholders 28% 25% 28% 50% 23% 20% 24% 50%

Lack of HR resources 16% 14% 19% 13% 19% 18% 19% 30%

None - we have no challenges 6% 8% 6% 0% 6% 8% 0% 0%

I don't know 1% 1% 0% 0% 2% 0% 4% 10%


32%

30%

30%

26%

22%

13%

6%

2%

38%

28%

27%

24%

16%

14%

7%

2%

None - we don't use any tools, we manage recruitment manually in-house

Applicant tracking software (ATS)

Psychometric assessment

Background screening tools

Video interviewing platform

Contract generation software

None - we don't use any tools, we use third-party agencies / recruitment firms

I don't know

Which tool(s) does your organisation use to improve the recruitment process?

2020 (n = 846)

2019 (n = 684)

Tools used to improve recruitment



Summary:

In comparison to 2019, there were two significant changes relating to the tools used to manage recruitment: the increase in the percentage of organisations using video interviewing platforms (from

16% in 2019 to 22% in 2020); and the decrease in the percentage of organisations only using manual in-house processes to manage their recruitment activities (from 38% in 2019 to 32% in 2020).

Insight:

A mix of foreseen and unforeseen forces shaped responses to this question. An example of the former is the growing trend towards automation of recruitment tasks, which tech expert Josh Bersin

has identified as being the HR area most prone to AI-driven disruption. An example of the latter was, of course, the global pandemic. This impacted recruitment in unexpected ways, such as the

widespread adoption of video interviewing platforms. These became necessary due to social distancing.

It’s also interesting to note subtle differences in responses based on organisation size. For example, while many enterprise organisations moved all their recruitment in-house some time ago to

reduce costs, it’s only now that mid-market organisations have started following their lead, as they’ve become more capable and self-sufficient when it comes to recruitment. The most noticeable

shift for mid-market respondents was the increased use of applicant tracking software (ATS). In 2020, nearly half of mid-market respondents had ATS in comparison to only one third in 2019. The

decrease in the percentage of organisations only using manual in-house processes to manage their recruitment activities is also perhaps further evidence of the decline in use of third-party

agencies and recruitment firms. In 2020, only 1% of mid-market respondents said they used third-party agencies or recruiters, in comparison to 5% in 2019.

Action:

● Assess how technology can help the recruitment function. There has recently been an increase in the functionality and capability of recruitment technology tools, to cover not just the

fundamentals of talent attraction and selection, but also adjacent areas such as internal mobility and career management. Reporting tools have also improved with the rise of predictive

analytics. So, investigate which solutions are best suited to meet the talent acquisition requirements of your organisation.

● Refresh your interview guides and templates to ensure they accommodate a more virtual experience for candidates. Consider including additional stages to build rapport and social

connections in addition to the regular interview stages to accommodate for in-person time that may be lacking from virtual interviews.

49%

33%

13%

38%26%

7%


2019 2020

https://joshbersin.com/2019/08/hr-technology-2020-disruption-ahead/


n = 846 120 192 287 247 736 110 494 282 70



Mid-level Senior C-suite



management management leaders (1 - 199) (200 - 1999) (2000+)

Applicant tracking software (ATS) 30% 38% 27% 29% 29% 29% 36% 19% 43% 54%

Background screening tools 26% 33% 31% 21% 23% 26% 20% 20% 31% 47%

Contract generation software 13% 16% 11% 10% 16% 13% 8% 8% 19% 21%

Psychometric assessment 30% 29% 32% 30% 29% 30% 28% 25% 33% 51%

Video interviewing platform 22% 23% 24% 20% 22% 22% 18% 18% 25% 37%


6% 3% 7% 5% 6% 5% 11% 9% 1% 0%


32% 24% 29% 35% 33% 33% 25% 38% 26% 7%

I don't know 2% 3% 2% 2% 1% 2% 2% 2% 1% 6%

Highest value




Highest value





Total resp. SMB Mid-market Enterprise Total resp. SMB Mid-market Enterprise

n = 556 n = 300 n = 204 n = 52 n = 290 n = 194 n = 78 n = 18

Applicant tracking software (ATS) 40% 28% 51% 60% 11% 5% 19% 39%

Background screening tools 30% 24% 36% 46% 17% 13% 17% 50%

Contract generation software 17% 12% 23% 27% 4% 3% 9% 6%

Psychometric assessment 33% 29% 34% 52% 23% 19% 29% 50%

Video interviewing platform 26% 22% 27% 46% 13% 11% 18% 11%


4% 6% 1% 0% 9% 12% 3% 0%


25% 32% 20% 8% 44% 49% 42% 6%

I don't know 1% 1% 1% 4% 3% 3% 1% 11%



38%

34%

30%

27%

20%

15%

14%

10%

9%

8%

5%

31%

36%

39%

31%

24%

14%

18%

18%

13%

11%

5%

None - we don't use any metrics

Overall employee turnover rate

Time to hire

Turnover rate of new hires (in their first year)

Cost to hire

Number of employee referrals

Offer acceptance rate

Percentage of open positions

Sourcing channel effectiveness

Sourcing channel costs

I don't know

Which metric(s) does your organisation use to measure the performance of its recruitment processes?

2020 (n = 843)

2019 (n = 681)

Metrics used to measure the recruitment process



Summary:

Overall, there was a regression in the use of metrics to measure the performance of recruitment processes for organisations of all sizes. Over a third of respondents (38%) do not use any metrics at all, an increase of 7 percentage points from 2019.

Insight:

The decline in the use of recruitment metrics is noteworthy because there was a significant increase in the use of recruitment technology between 2019 and 2020. Those who utilised technology also used a larger variety of metrics, so the question must be asked: why aren’t more HR teams using at least one metric to measure the efficiency and / or effectiveness of their recruitment processes? It’s also worth noting that the most common metric used to measure recruitment process effectiveness was ‘overall employee turnover’, which does not accurately reflect the quality or efficiency of recruitment processes. For example, it’s unlikely that the turnover of an employee with 10 years of service accurately reflects the quality of the process that was used when they were recruited. This indicates that many HR professionals may still be unsure what metrics they should be using to evaluate their recruitment processes.

‘Turnover rate of new hires’ is a valuable metric that all organisations can use. A lot of time and money is spent getting a new hire on board. If the new hire does not stay long, this directly impacts bottom line costs. ‘Turnover rate of new hires’ can also be broken down further into voluntary and non-voluntary categories to create metrics that indicate an issue with the new starter experience or with the quality of their hiring process.

Action:

● Determine the metrics that are most valuable to assess recruitment processes. Effective measurement doesn’t need to rely on a single metric: consider identifying different metrics for candidate sourcing, interview effectiveness and efficiency, new hire productivity and engagement.

● Access technology to help collate and analyse the metrics that matter.

2 in 10 respondents do not use any metricsto measure the performance of their

recruitment process

2 in 5 respondents do not use any toolsto improve their recruitment process and

they manage it manually in-house


n = 843 120 191 285 247 733 110 494 279 70




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Cost to hire 20% 19% 20% 20% 20% 20% 19% 17% 23% 30%

Number of employee referrals 15% 13% 8% 18% 17% 15% 11% 12% 18% 21%

Offer acceptance rate 14% 11% 9% 16% 17% 14% 13% 11% 14% 34%

Overall employee turnover rate 34% 28% 31% 37% 35% 35% 29% 30% 41% 37%

Percentage of open positions 10% 11% 7% 9% 11% 10% 6% 5% 15% 20%

Sourcing channel costs 8% 9% 6% 8% 10% 8% 12% 6% 12% 9%

Sourcing channel effectiveness 9% 6% 7% 11% 11% 9% 12% 7% 12% 13%

Time to hire 30% 32% 27% 29% 32% 30% 29% 22% 38% 46%

Turnover rate of new hires (in their first year) 27% 25% 26% 27% 30% 28% 25% 24% 32% 36%

None - we don't use any metrics 38% 29% 41% 38% 41% 38% 39% 45% 32% 16%

I don't know 5% 13% 6% 2% 2% 5% 5% 4% 4% 13%

Highest value




Highest value






n = 549 n = 298 n = 201 n = 50 n = 290 n = 194 n = 78 n = 18

Cost to hire 24% 21% 26% 32% 13% 11% 15% 28%

Number of employee referrals 18% 14% 21% 24% 9% 9% 9% 17%

Offer acceptance rate 18% 15% 17% 38% 8% 6% 8% 28%

Overall employee turnover rate 36% 33% 39% 40% 31% 26% 44% 33%

Percentage of open positions 13% 8% 18% 20% 4% 2% 6% 22%

Sourcing channel costs 9% 7% 12% 10% 7% 6% 10% 6%

Sourcing channel effectiveness 12% 8% 15% 18% 4% 5% 4% 0%

Time to hire 35% 28% 42% 46% 21% 15% 28% 50%

Turnover rate of new hires (in their first year)

30% 27% 33% 36% 23% 19% 29% 39%

None - we don't use any metrics 36% 43% 30% 18% 43% 49% 36% 11%

I don't know 4% 2% 5% 8% 7% 6% 3% 28%



76%

68%

65%

57%

53%

17%

13%

83%

68%

68%

57%

60%

17%

16%

Job boards

Social media channels (e.g. LinkedIn, Facebook)

Employee referrals

Internal talent / succession program

External recruiters

Established external talent pool

Career fairs

Which source(s) does your organisation use to find a new hire?

2020 (n = 834)

2019 (n = 681)

Channels used to source candidates



Summary:

Between 2019 and 2020, there was a decrease in the use of more traditional channels used to source candidates such as job boards (e.g. Seek), external recruiters and career fairs. However, job boards remained the top channel used, followed by social media and employee referrals.

Insight:

Why is the use of job boards declining? It may be that this channel is not always the most efficient use of a recruiter’s time. Wading through an influx of irrelevant resumes from a job post can take many hours, whereas proactively seeking out suitable candidates and utilising targeted social media posts and employee referrals tends to create better quality candidate pools. The reduced use of job boards may also reflect the changing dynamics of candidate sourcing. Social media, individual networks and prospecting efforts are now used more often to reach candidates before they begin actively searching for roles.

Whilst very few SMB or mid-market respondents said they use career fairs to source candidates, 40% of enterprise respondents said they still use them. In addition, enterprise respondents were more likely to source candidates through a pre-established external talent pool.

Action:

● Review the effectiveness of the channels you use to find new hires. Some metrics to consider are channel cost per hire, the time taken to hire through each channel, and the overall hiring quality achieved through each channel.

● Ensure that any social media presence you have enables candidates to understand your brand and EVP. It may be their first introduction to your organisation or a touchpoint in their research. Regardless, it will be an important avenue to engage with and attract fresh talent.

1 in 2 mid-level and senior management respondents and 3 in 10 C-suite leaders do not

know the turnover rate for new hires within their probation period


n = 834 119 190 279 246 728 106 489 277 68




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

External recruiters 53% 52% 58% 54% 49% 52% 60% 54% 50% 65%

Employee referrals 65% 62% 64% 66% 64% 65% 59% 65% 64% 63%

Job boards 76% 82% 76% 76% 74% 77% 68% 70% 84% 88%

Internal talent / succession program 57% 61% 51% 63% 52% 57% 57% 48% 68% 72%

Established external talent pool 17% 16% 12% 16% 22% 18% 10% 17% 13% 29%

Career fairs 13% 13% 14% 14% 11% 13% 10% 7% 17% 40%

Social media channels (e.g. LinkedIn, Facebook) 68% 75% 61% 70% 68% 68% 71% 64% 72% 78%

Highest value




11%

21%

15%

19%

15%

7%

11%

62%

52%

59%

57%

57%

36%

53%

22%

22%

22%

21%

26%

44%

30%

4%

4%

4%

2%

10%

6%

3%

External recruiters (n = 439)

Employee referrals (n = 534)

Job boards (n = 633)

Internal talent / succession programs (n = 467)

Established external talent pools (n = 136)

Career fairs (n = 106)

Social media channels (e.g. LinkedIn, Facebook) (n = 562)

How would you rank the effectiveness of each channel in finding the most suitable candidate?

Extremely effective Effective Neutral Ineffective Extremely ineffective

Effectiveness of candidate search channels


This table presents the % of respondents who selected either ‘effective’ or ‘very effective’.

n = 834 119 190 279 246 728 106 489 277 68




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

External recruiters 73% 73% 76% 70% 74% 74% 67% 72% 74% 77%

Employee referrals 73% 74% 70% 77% 72% 75% 63% 73% 74% 70%

Job boards 74% 72% 77% 74% 71% 75% 67% 70% 81% 67%

Internal talent / succession programs 76% 82% 72% 71% 82% 76% 75% 77% 74% 76%

Established external talent pools 72% 63% 82% 67% 75% 72% 73% 73% 70% 70%

Career fairs 42% 63% 50% 36% 32% 45% 18% 47% 40% 41%

Social media channels (e.g. LinkedIn, Facebook) 63% 63% 68% 61% 63% 65% 54% 60% 69% 64%

Other source 75% 89% 57% 88% 69% 70% 91% 79% 60% 67%

Highest value


Effectiveness of candidate search channels


13%

36%

37%

9%

4%

1%

Excellent

Good

Average

Poor

Very poor

I don't know

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively

managing recruitment ?

n = 737

Internal systems and processes



Summary:

In terms of judging internal systems and processes, 60% of respondents with fully implemented recruitment technology rated their recruitment systems and processes as ‘excellent’ or ‘good’, compared with 29% of respondents who did not have fully implemented technology.

Insight:

Technology made a significant difference in how respondents rated the efficiency and effectiveness of their recruitment systems and processes. It’s also apparent that enterprise respondents were far less satisfied with their recruitment systems and processes than SMBs and mid-market respondents, and this was the same regardless of whether they used technology or not.

This result is potentially linked to some of the key challenges that were more apparent for enterprise respondents, such as ‘slow decision making / too many stakeholders’, ‘creating a positive candidate experience’ and ‘reducing time to hire’. Unfortunately, these three challenges cannot necessarily be improved via the use of technology.

Action:

● Where established, leverage any technology solution to maximise efficiency and effectiveness. Also ensure your users are familiar with new features and update processes to align with changing functionality.

● Review existing recruitment processes and identify where additional opportunities for optimisation exist. Consider workflow automations or other technology solutions that may assist.

● Consider conducting candidate surveys to shed light on the candidate experience. This can be invaluable when trying to enhance talent acquisition processes.

6 in 10 respondents with fully implemented technology rate their recruitment systems as ‘excellent’ or ‘good’

3 in 10 respondents without fully implemented technology rate their recruitment systems as ‘excellent’ or ‘good’


n = 737 106 165 249 217 645 92 429 251 57

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing recruitment?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Excellent 13% 8% 7% 14% 18% 13% 13% 14% 12% 4%

Good 36% 43% 34% 31% 40% 36% 38% 38% 34% 26%

Average 37% 33% 41% 42% 31% 37% 37% 34% 39% 49%

Poor 9% 9% 10% 10% 6% 9% 7% 8% 10% 9%

Very poor 4% 5% 5% 3% 4% 4% 3% 4% 3% 11%

I don't know 1% 2% 4% 0% 1% 1% 2% 2% 1% 2%

Highest value




Highest value




Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing recruitment ?


n = 484 n = 262 n = 179 n = 43 n = 253 n = 167 n = 72 n = 14

Excellent 16% 15% 13% 4% 6% 6% 1% 0%

Good 43% 38% 31% 27% 23% 21% 18% 5%

Average 34% 23% 30% 42% 43% 35% 36% 30%

Poor 4% 3% 3% 4% 18% 12% 23% 15%

Very poor 2% 2% 1% 4% 8% 4% 7% 20%

I don't know 1% 0% 0% 2% 3% 3% 1% 0%



Note: This question asked respondents to provide values relating to several aspects of the recruitment process. The number of respondents listed for each column in the table above refers to the average number of people who provided an answer for these questions, as some respondents may not have answered all questions.

Average hours spent on recruitment activities

Highestaverage

value

Saturation segment scale:Lowestaverage

value

Average n = 467 68 108 165 126 405 62 311 130 26

Estimate how many hours you personally currently spend on these key recruitment activities per new hire?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Applicant review and shortlisting 4 3 5 4 4 4 4 4 4 4

Applicant tracking 2 3 3 3 3 3 2 3 2 4

Background / Reference checking 2 2 2 2 2 2 2 2 2 3

Candidate sourcing 5 5 6 5 5 5 4 5 4 7

Careers site management 2 1 2 2 2 2 2 2 2 2

Interview scheduling 2 2 2 3 3 2 2 3 2 3

Interviewing 5 5 6 5 6 6 5 6 5 6

Job posting 2 1 2 2 2 2 2 2 1 4

Offer management 2 1 2 2 2 2 2 2 2 2

Other 3 5 3 3 3 3 5 3 2 3

Psychometric and skills testing 3 2 2 3 2 2 2 2 3 2

Reporting 2 1 2 2 2 2 2 2 1 3

Writing position descriptions 3 2 2 3 4 3 2 3 3 4



Average n = 467 68 108 165 126 405 62 311 130 26

Estimate how many hours you personally currently spend on these key recruitment activities per new hire?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Applicant review and shortlisting 2 3 2 2 2 2 2 2 2 2

Applicant tracking 2 1 2 1 2 2 2 2 1 1

Background / Reference checking 1 1 1 1 1 1 2 2 1 1

Candidate sourcing 3 3 3 3 3 3 3 3 2 3

Careers site management 1 1 1 1 1 1 1 1 1 1

Interview scheduling 1 1 1 2 1 1 2 2 1 1

Interviewing 4 5 5 4 5 5 4 5 4 3

Job posting 1 1 1 1 1 1 1 1 1 1

Offer management 1 1 1 1 1 1 1 1 1 1

Psychometric and skills testing 1 1 1 1 1 1 1 1 1 1

Reporting 1 1 1 1 1 1 1 1 1 1

Writing position descriptions 2 2 1 2 2 2 2 2 1 2

Highestmedian

value

Saturation segment scale:Lowestmedian

value

Median hours spent on recruitment activities



Average number of days taken to fill position vacancies

Highestaverage

value


value

Average n = 494 68 103 180 144 746 102 297 169 29

What is the average number of days it takes to fill the following types of vacant positions in your organisation?

OverallJunior tomid-level


Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Entry-level / junior roles 23 25 23 22 22 23 22 23 20 20

Mid-level individual contributors 29 30 29 31 26 29 31 29 27 26

Mid-level managers 34 36 35 34 31 33 35 35 30 35

Senior-level individual contributors 41 40 42 43 39 41 43 42 38 42

Senior-level managers 45 44 45 47 43 45 47 45 40 45

Executives 58 55 55 61 59 58 61 62 56 48



Average n = 494 68 103 180 144 746 102 297 169 29

What is the average number of days it takes to fill the following types of vacant positions in your organisation?



Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)






Executives 60 40 60 60 60 58 60 60 50 60

Highestmedian

value


value

Median number of days taken to fill position vacancies



Average cost of hiring a new employee

Highestaverage

value


value

Average n = 494 25 40 93 71 195 34 297 169 29

What is the estimated cost of hiring a new employee in your organisation?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)






Executives 22083 20307 23634 22092 21815 22990 16189 22086 20915 31375



Average n = 494 25 40 93 71 195 34 297 169 29

What is the estimated cost of hiring a new employee in your organisation?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)






Executives 15000 15000 7500 10000 15000 15000 8500 10000 15000 25000

Highestmedian

value


value

Median cost of hiring a new employee

Monica Watt | ELMO CLOUD HR & PAYROLL | 2018 149

Appendix D:Onboarding



n= Industry segment

New hire

turnover rate

within probation

period

15 Accommodation and food services^ 9%

6 Administrative and support services^ 4%

12 Agriculture, forestry and fishing^ 6%

8 Arts and recreation services^ 5%

22 Construction^ 6%

35 Education and training 6%

10 Electricity, gas, water and waste services^ 7%



29 Information media and telecommunications^ 7%

30 Manufacturing 7%

7 Mining^ 7%



17 Public administration and safety^ 3%

8 Rental, hiring and real estate services^ 13%

11 Retail trade^ 7%

14 Transport, postal and warehousing^ 10%

8 Wholesale trade^ 8%

n = 813 114 185 274 240 709 104 472 275 66

What is the turnover rate (as a percentage) for new hires in your organisation within their probation period?

OverallJunior to Mid-level

Mid-level manage

ment

Senior manage

ment

C-suite leaders

AustraliaNew

ZealandSMB

(1 - 199)

Mid-market(200 -1999)

Enterprise

(2000+)

Provided details 55% 32% 45% 60% 67% 56% 49% 65% 43% 33%

I don't know 45% 68% 55% 40% 33% 44% 51% 35% 57% 67%

n= Industry segment

New hire turnover

rate within

probation period

393 Australia 7%

50 New Zealand 6%

302 SMB 5%

119 Mid-market 9%

22 Enterprise^ 13%

Highest value


Turnover rates for new hires


Turnover rates for new hires

Summary:

2020 new hire turnover rates were roughly the same as 2019, with the A / NZ average remaining at 7%. The results were also broadly the same as 2019 when calculated by country and organisation size. There was little change between 2019 and 2020 in the percentage of C-suite leaders ‘actively involved in’ or ‘responsible for’ onboarding who did not know their new hire turnover rate.

Insight:

The lack of knowledge about new hire turnover rates was somewhat surprising given that this metric is fairly easy to calculate and can help an organisation gauge if there is an issue with the quality of hiring and / or with new employee experiences. The cost of recruiting and training a new employee only to see them leave within the first year of their employment is especially regrettable, as the organisation has likely not yet seen a return on investment for that new starter. In addition, the organisation is forced to fill the role again which duplicates hiring and training costs.

Overall, less than half of all the respondents who indicated they were ‘actively involved in’ or ‘responsible for’ onboarding knew their new hire turnover rate. This indicates that there are still many executive teams who do not yet see HR as a strategic player at the table. These executive teams do not value the metrics and insights available to them, which can inform their organisational effectiveness. They are either not asking for these metrics or HR teams are not proactively providing them. Unfortunately, it is common for requests for onboarding metrics to only occur after the turnover of new starters is noticed by executives. By this time, the issue may be harder to resolve. Proactively tracking these metrics can help HR teams spot potential issues early and minimise new hire turnover. This can save a lot of time and money.

Action:

● HR must proactively report on new hire turnover rates. A simple way to calculate new hire turnover (a.k.a. ‘early separators’) is to take the most recent segment of new hires who started between 12 and 24 months ago, and then work out how many of them left within their first year of service. These figures can also be divided into voluntary and involuntary leavers. Voluntary leavers are potentially reflective of a poor new starter experience. The involuntary leavers are potentially reflective of a poor hire / job fit. Using onboarding surveys can be a good way to understand what drivers are behind the challenges for new hires.

Example of Company ABC calculating their 2019 new hire turnover on 31 December 2020:

No. of new FTE that started between Jan 1 2019 and 31 Dec 2019 Number that terminated before their 1-year tenure date New hire turnover rate

500 40 40 ÷ 500 × 100 = 8%


Onboarding as a priority

Summary:

Between 2019 and 2020, there was a significant increase in the use of onboarding technology. In 2020, half of the respondents were using a form of technology in comparison to only one third back in 2019. There was also a decrease in the percentage of respondents who said that onboarding was taking up too much of HR’s time. The ratio was 1 in 4 back in 2019 but this reduced to just 1 in 6 in 2020.

Insight:

There are a few potential reasons for the decline in respondents saying that onboarding takes up too much of HR’s time relative to the value it brings:

● The increased use of technology to automate onboarding tasks is reducing the amount of time that HR teams spend onboarding new employees.

● There was less focus on recruitment in 2020 due to the COVID-19 pandemic, so there was less requirement to spend time onboarding new employees. In many cases, remote onboarding was also less time and resource intensive than in-person onboarding.

● The percentage of respondents who said their onboarding program lasts 1, 3 or 6 months increased whilst the percentage who said it lasts only 1 day or 1 week declined. This indicates that perceptions around the purpose of onboarding are shifting, from being viewed as an administrative task to being viewed as an important aspect of the employee experience (EX). Therefore, the perceived value of the time spent onboarding new employees has changed.

Action:

● Consider the benefits of implementing onboarding technology. With an economic recovery likely in 2021, recruitment will no doubt return to business agendas. For organisations considering the use of technology to assist with recruitment and onboarding, now is the time to undertake market research to find a solution that best fits the needs of the organisation.

35%

23%

76%

31%

52%

51%

16%

60%

28%

59%

% that had fully implemented

onboarding technology

% who said onboarding is taking up too

much of HR's time

% who said onboarding was a high or

medium priority for their organisation

% who said their onboarding program

takes 1 day or 1 week

% who said their onboarding program

takes 1, 3 or 6 months

2020 2019


36%

32%

30%

29%

24%

24%

19%

18%

13%

9%

10%

4%

38%

31%

35%

27%

28%

26%

23%

21%

16%

11%

11%

4%

Lack of regular check-ins with new hires

Integrating new hires into teams / culture

Ad hoc steps / lack of formal processes

Too much information for new hires

Lack of training for new hires

Lack of orientation for new hires

Length of onboarding process

Lack of role clarity for new hires

Too little information for new hires

Lack of training for you / your team


I don't know

What are your organisation's key onboarding challenges?

2020 (n = 908)

2019 (n = 762)

Key onboarding challenges



Summary:

There were no major changes in the results for this question between 2019 and 2020. The largest shift was the percentage of respondents who were challenged by ad hoc steps / lack of formal processes, which reduced by 5 percentage points and could be linked to the increase in fully implemented onboarding technology. Respondents using technology were also less challenged by too little information for new hires, a lack of orientation for new hires and a lack of regular check-ins with new hires. Twice as many respondents with onboarding technology said they had no onboarding challenges.

Insight:

Creating an effective onboarding process is not just the responsibility of HR teams. Whilst HR teams may take ownership of administrative onboarding tasks, formal induction programs and occasional check-ins with new starters and individual managers will have the biggest impact on new hire success rates. HR teams can influence how managers onboard new starters by providing leadership coaching in this area.

Despite technology resolving or reducing numerous onboarding challenges, the right balance of information must be carefully considered. It is tempting to cover too much once there is a form of technology that can help automate some of the information. This challenges organisations to approach onboarding as an experience and to engage with intent, providing the right information at the right time. When the key onboarding challenges were compared by organisation size, enterprise respondents found it more difficult to get their onboarding program right. However, this result is not surprising. The larger the organisation is, the more complex processes tend to be, meaning there can simply be too much to cover in an onboarding program.

Action:

According to an article published in 2019 by Harvard Business Review, there are seven key steps that managers should take to onboard a new starter and set them up for success:

1. Understand the individual challenges for new hires based on their experience and how the change might be impacting them personally – e.g. have they relocated for the role? Is the role a different level of seniority to their previous role?

2. Accelerate new hires’ learning by identifying what they need to learn from a technical, cultural and political perspective. This will speed up their ability to navigate their way through challenges.3. Make them part of the team by making sure the team knows why the new starter was hired and what role they will undertake. Introduce them to everybody in the team as quickly as possible.4. Connect them with key stakeholders outside of their immediate team and check in with them about how those relationships are forming.5. Give them clear direction when asking them to undertake any work. There are three key things that need to be clarified: What do they need to do? How should they go about doing it? What is

the purpose or benefit of completing the task?6. Help them succeed early by allocating tasks to complete within a realistic timeframe that considers the extra time they may need to navigate their way through the task for the first time.7. Coach them for success by providing intensive support when they first join and then schedule regular check-ins to track how they are going and where they need more support.

https://hbr.org/2019/05/7-ways-to-set-up-a-new-hire-for-success


n = 791 132 187 259 213 691 100 442 282 67

What are your organisation's key onboarding challenges



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Ad hoc steps / lack of formal processes 30% 35% 26% 30% 31% 30% 31% 30% 30% 33%

Too little information for new hires 13% 14% 16% 11% 13% 14% 9% 12% 12% 22%

Too much information for new hires 29% 25% 27% 29% 32% 28% 31% 26% 32% 36%

Lack of role clarity for new hires 18% 18% 21% 18% 15% 18% 21% 17% 17% 31%

Lack of orientation for new hires 24% 23% 26% 23% 23% 25% 18% 18% 28% 45%

Lack of training for new hires 24% 24% 25% 22% 28% 24% 26% 24% 25% 27%

Lack of training for you / your team 9% 11% 18% 7% 4% 10% 6% 10% 7% 13%

Length of onboarding process 19% 19% 22% 17% 18% 18% 24% 15% 21% 39%

Lack of regular check-ins with new hires 36% 36% 37% 30% 40% 35% 39% 30% 44% 40%

Integrating new hires into teams / culture 32% 33% 36% 31% 30% 32% 33% 29% 36% 43%


I don't know 4% 5% 5% 2% 3% 4% 3% 4% 4% 3%

Highest value




Highest value



What are your organisation's key onboarding challenges? Total resp. SMB Mid-market Enterprise Total resp. SMB Mid-market Enterprise

n = 415 n = 231 n = 147 n = 37 n = 376 n = 211 n = 135 n = 30

Ad hoc steps / lack of formal processes 18% 18% 18% 16% 44% 43% 44% 53%

Too little information for new hires 8% 6% 6% 24% 19% 19% 19% 20%

Too much information for new hires 33% 31% 35% 32% 24% 19% 28% 40%

Lack of role clarity for new hires 16% 14% 17% 22% 20% 19% 17% 43%

Lack of orientation for new hires 16% 13% 17% 38% 32% 24% 40% 53%

Lack of training for new hires 22% 20% 24% 24% 27% 27% 27% 30%

Lack of training for you / your team 9% 8% 7% 16% 10% 12% 7% 10%

Length of onboarding process 19% 13% 25% 27% 19% 17% 16% 53%

Lack of regular check-ins with new hires 31% 26% 37% 41% 40% 34% 51% 40%

Integrating new hires into teams / culture 32% 30% 33% 41% 33% 27% 39% 47%


I don't know 3% 3% 3% 3% 4% 5% 4% 3%


Which of the following stages best describes your organisation's current state of HR and payroll and technology for onboarding?


43%

32%

20%

15%

11%

8%

7%

6%

5%

41%

35%

20%

15%

11%

7%

5%

6%

7%

None - we don't measure / use any metrics

New hire retention

Employee performance milestones being met

Impact on team morale / culture

Time to proficiency

I don't know

Employee Net Promoter Score (eNPS^)

Change in overall productivity

Headcount vs. output

Which metric(s) does your organisation use to measure the performance of its onboarding processes?

2020 (n = 757)

2019 (n = 617)

Measuring onboarding performance



Summary:

There were no significant changes in the use of onboarding metrics between 2019 and 2020. Nearly half of the respondents did not use any metrics to measure onboarding effectiveness, and only 1 in 3 respondents used a new hire retention metric to measure onboarding effectiveness.

Insight:

The low level of respondents using a new hire retention metric is interesting because 55% of respondents knew their new hire turnover rates. Therefore, new hire retention rates should also be easy to calculate. This further strengthens a previously cited insight in this report, which indicated that new hire turnover and retention rates are not of great interest at the leadership level, despite the way this metric can help identify issues early and save the organisation from duplicating hiring and training costs.

When comparing respondents who used onboarding technology, it was clear that technology makes the sourcing of onboarding metrics easier for HR teams. Metrics relating to new hire retention, time to proficiency, the impact on team morale / culture, employee performance milestones being met, and headcount vs. output were more commonly used by those with technology, especially in the SMB and mid-market segments.

Action:

● Utilise metrics to provide insights about onboarding. As a minimum, new hire turnover / retention rates should be calculated and used in regular reports to the C-suite.

● Set a regular cadence for analysing and reviewing onboarding metrics. These may be a part of HR meetings or included in dashboards. Making metrics visible will help prompt questions about what areas need further investigation and exploration.

2 in 5 respondents do not measure the performanceof their onboarding process

1 in 3 respondents measure the effectivenessof their onboarding process via their new

hire retention rate


n = 757 129 179 246 203 658 99 417 276 64




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Change in overall productivity 6% 5% 6% 5% 9% 6% 8% 9% 3% 2%

Employee Net Promoter Score (eNPS®) 7% 6% 6% 6% 10% 7% 7% 7% 7% 8%

Employee performance milestones being met 20% 13% 16% 26% 22% 21% 19% 21% 20% 17%

Headcount vs. output 5% 3% 4% 6% 6% 5% 3% 6% 4% 5%

Impact on team morale / culture 15% 11% 13% 17% 16% 15% 14% 18% 12% 13%

New hire retention 32% 26% 25% 38% 35% 33% 26% 30% 35% 41%

Time to proficiency 11% 6% 9% 12% 15% 10% 14% 12% 8% 17%

None - we don't measure / use any metrics 43% 40% 44% 43% 46% 44% 42% 45% 45% 30%

I don't know 8% 22% 11% 3% 2% 8% 8% 7% 8% 16%

Highest value





Highest value





n = 399 n = 219 n = 144 n = 36 n = 358 n = 198 n = 132 n = 28

Change in overall productivity 6% 9% 3% 0% 6% 9% 3% 4%

Employee Net Promoter Score (eNPS) 9% 8% 11% 6% 5% 6% 3% 11%

Employee performance milestones being met 25% 26% 24% 19% 16% 16% 17% 14%

Headcount vs. output 7% 7% 7% 3% 3% 4% 1% 7%

Impact on team morale / culture 17% 19% 15% 14% 13% 16% 8% 11%

New hire retention 38% 35% 40% 42% 27% 23% 29% 39%

Time to proficiency 13% 14% 13% 14% 8% 11% 2% 21%

None - we don't measure / use any metrics 38% 40% 39% 28% 49% 50% 52% 32%

I don't know 6% 5% 6% 11% 10% 9% 11% 21%





9%

22%

20%21%

11%

2%

11%

4%

8%

20%

25%

23%

11%

1%

9%

3%

1 day Up to 1 week Up to 1 month Up to 3 months Up to 6 months More than 6

months

No formal

process

I don't know

What is the average duration of your organisation's onboarding program?

2019 (n = 616)

2020 (n = 757)

Duration of onboarding programs



Summary:

Onboarding is increasingly being seen as a critical part of the employee experience (EX). This is seen in the reduced number of respondents who said their onboarding program takes 1 day or 1 week, and the increased number of respondents who said it takes 1month or 3 months. The shift to longer onboarding programs indicates that more staged programs are being developed that consider all aspects of the EX and provide more support for new starters beyond the administrative aspects of onboarding.

Insight:

Best practice is to stage onboarding programs to make them meaningful, not just accessible. For example, aligning employee check-ins with development milestones that link to training, competency, internal and external relationship building, and social and cultural integration. Those who are using technology are in a better position to analyse this and find the right balance because so much of the onboarding journey can be tracked and measured. Regular checkpoints throughout the onboarding journey can be supported via the use of technology and onboarding feedback surveys, which helps HR teams identify opportunities to improve both the process and the EX.

Roughly 1 in 11 organisations had no formal onboarding process, and this result did not differ greatly across the organisation size segments. Whilst some organisations may give all the onboarding responsibilities to individual managers to carry out as they see fit, these organisations are at risk of an unstructured or ‘sink or swim’ approach being used with a new starter.

Action:

● Regardless of the duration of the onboarding process, it’s essential to have a formal process in place. A formal process helps time-poor managers take a more proactive role in the onboarding of new starters. It also ensures all steps are covered, with theright amount of information for new hires distributed at the right time during their onboarding journey. This approach reduces the risk of information overload for new hires.

● Ensure all new hires have a consistent onboarding experience. Without a formal process in place, there is no real understanding of what the new employee experience is like; and as the organisation grows larger, so too does the risk that pockets of the organisation are creating a poor EX for new starters. Unfortunately, the repercussions of onboarding inconsistencies are often not known until valuable time and money has already been lost.

1 in 4 respondents said the duration of their onboarding program is up to 1 month

1 in 5 respondents said the duration of their onboarding program is up to 1 week


n = 757 129 179 246 203 658 99 417 276 64




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

1 day 8% 4% 10% 10% 7% 8% 10% 9% 6% 9%

Up to 1 week 20% 19% 18% 22% 21% 21% 15% 20% 22% 14%

Up to 1 month 25% 29% 29% 18% 27% 25% 21% 26% 24% 22%

Up to 3 months 23% 20% 18% 28% 21% 21% 34% 22% 22% 28%

Up to 6 months 11% 13% 13% 13% 7% 13% 2% 10% 14% 6%

More than 6 months 1% 1% 1% 1% 1% 1% 2% 1% 1% 2%

No formal process 9% 9% 6% 8% 14% 9% 11% 10% 8% 11%

I don't know 3% 6% 6% 0% 1% 3% 4% 2% 3% 8%

Highest value




Highest value






n = 399 n = 219 n = 144 n = 36 n = 358 n = 198 n = 132 n = 28

1 day 10% 10% 8% 17% 6% 8% 4% 0%

Up to 1 week 22% 22% 24% 14% 18% 17% 20% 14%

Up to 1 month 26% 30% 22% 22% 23% 22% 26% 21%

Up to 3 months 21% 20% 23% 25% 24% 25% 21% 32%

Up to 6 months 13% 12% 15% 8% 10% 9% 14% 4%

More than 6 months 0% 0% 0% 3% 2% 2% 2% 0%

No formal process 6% 6% 6% 6% 13% 14% 11% 18%

I don't know 2% 1% 3% 6% 4% 3% 3% 11%



2%

7%

20%

37%

20%

4%

11%

2%

10%

25%

33%

17%

3%

10%

1 day 1 week 1 month 3 months 6 months 12 months + I don't know

How long does it typically take for a new hire to be fully productive after they have commenced employment?

(Including onboarding period)

2019 (n = 615)

2020 (n = 756)

Time for new hires to reach full productivity



Summary:

3 months was still the most common length of time for a new starter to reach full productivity in 2020. However, there was an increase in respondents who said that full productivity is reached within 1 month, which correlates with the increase in the number of respondents who said their onboarding program lasts 1 month. There was no substantial difference between the answers given to this question by respondents who do and do not use onboarding technology.

Insight:

Like many other areas of this report, it’s apparent that while technology can make onboarding processes easier, save time and help create a more consistent EX for new starters, it can only improve processes so much. For example, the impact of technology on time to productivity for new hires is negligible. This indicates there are other elements to consider in getting new staff up to speed quickly. These elements may be how well ‘socialised’ the new hire is with colleagues and peers, and any training and support they are given in these early days of employment.

Action:

● Ensure the onboarding process contains the right mix of elements to ensure new hires are productive as soon as possible. This will include opportunities to meet and collaborate with colleagues, providing relevant training and tools to do the job, offering information about the company and its culture, and ensuring all compliance-related issues (including paperwork for third-party agencies) are sorted out quickly and efficiently.

1 in 3 respondents said new hires typically take 3 months to get up to full productivity

1 in 5 respondents said new hires typically take 6 months to get up to full productivity

1 in 10 respondents said full productivity for new hires is reached within 1 week


n = 756 129 179 246 202 657 99 417 275 64

How long does it typically take for a new hire to be fully productive after they have commenced employment? (Including onboarding period)



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

1 day 2% 2% 3% 1% 4% 2% 2% 3% 2% 2%

1 week 10% 9% 13% 8% 10% 9% 11% 11% 7% 11%

1 month 25% 28% 25% 24% 24% 26% 19% 24% 26% 22%

3 months 33% 32% 30% 35% 33% 32% 35% 30% 35% 39%

6 months 17% 16% 16% 21% 16% 17% 21% 18% 17% 13%

12 months + 3% 3% 3% 2% 5% 3% 4% 4% 3% 5%

I don't know 10% 12% 11% 8% 9% 10% 7% 10% 9% 9%

Highest value




Highest value




How long does it typically take for a new hire to be fully productive after they have commenced employment? (Including onboarding period)


n = 398 n = 219 n = 143 n = 36 n = 358 n = 198 n = 132 n = 28

1 Day 2% 2% 2% 0% 3% 4% 2% 4%

1 week 11% 13% 7% 17% 8% 9% 7% 4%

1 month 25% 22% 29% 22% 25% 27% 23% 21%

3 months 32% 32% 31% 33% 34% 28% 39% 46%

6 months 20% 22% 16% 17% 15% 14% 19% 7%

12 months + 2% 1% 3% 3% 5% 7% 3% 7%

I don't know 9% 8% 11% 8% 10% 12% 8% 11%



9%

33%

37%

12%

6%

2%

Excellent

Good

Average

Poor

Very poor

I don't know


managing the onboarding of new starters?

n = 733




Summary:

Roughly 2 in 5 respondents said their onboarding process was excellent or good, and 1 in 5 respondents said their onboarding process was poor or very poor. Very few respondents selected ‘I don’t know’ for this question, yet it was established in an earlier question that nearly half of respondents do not use any metrics to measure the effectiveness of their onboarding process.

Insight:

The lack of onboarding metrics raises an interesting question for those attempting to assess their internal systems and processes. What have respondents based their rating on? Gut feelings? Verbal feedback from new starters or managers? This confusion again highlights how critical metrics are for assessing all aspects of HR’s role.

There were two main conclusions that were drawn from this question. The first was that there is plenty of room to improve onboarding processes across A / NZ. The second was that technology significantly assists with the creation of a good onboarding process. 58% of respondents who have a fully implemented form of onboarding technology said their internal onboarding systems and processes were excellent or good, in comparison to only 26% of respondents without onboarding technology.

A structured onboarding process is vital to improving perceptions of the onboarding experience. According to an article published by Forbes Magazine in 2019, new employees who went through a structured onboarding program were 58% more likely to be with the organisation after three years, and organisations with a good onboarding process experience reported 50% greater new starter productivity.

Action:

● Focus on the employee experience (EX) from day one. The impression an employer makes on a new hire is a fair indication of what the employee can expect for their future career with the organisation. These early days are also the ideal opportunity to show how much the organisation values its people. The Forbes article cited above outlined the worst ‘first day experiences’ that may lead to a new employee resigning:

- The manager is not there to greet the new employee or spend enough time with them.- There is no workspace available for the new employee – e.g. they sit in a meeting room with a laptop rather than a pre-planned workspace with the rest of their team.- The critical equipment and resources that a new hire needs are not available – e.g. they do not have essential logins set up, or there is no computer available to use.- The organisation only talks about policies and procedures but there is no talk about the organisation’s mission, vision or values.

https://www.forbes.com/sites/kevinkruse/2019/11/21/3-signs-you-should-quit-after-your-first-day-on-the-job/?sh=1b4b0f212125


n = 751 128 178 244 201 653 98 414 274 63

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing the onboarding of new starters?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Excellent 9% 8% 6% 12% 10% 9% 8% 12% 7% 2%

Good 33% 34% 35% 30% 35% 33% 33% 35% 32% 27%

Average 37% 36% 35% 41% 34% 36% 41% 36% 38% 38%

Poor 12% 12% 15% 11% 11% 12% 12% 10% 15% 14%

Very poor 6% 5% 6% 6% 7% 7% 4% 4% 7% 16%

I don't know 2% 5% 3% 0% 3% 2% 2% 3% 1% 3%

Highest value




Highest value




Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing the onboarding of new starters?


n = 395 n = 217 n = 143 n = 35 n = 356 n = 197 n = 131 n = 28

Excellent 14% 17% 13% 3% 4% 7% 2% 0%

Good 44% 46% 44% 31% 22% 24% 18% 21%

Average 32% 30% 33% 40% 42% 43% 44% 36%

Poor 7% 6% 8% 11% 17% 14% 22% 18%

Very poor 2% 0% 2% 9% 11% 9% 12% 25%

I don't know 2% 1% 1% 6% 3% 5% 2% 0%



Note: This question asked respondents to provide values relating to several aspects of the onboarding process. The number of respondents listed for each column in the table above refers to the average number of people who provided an answer for these questions, as some respondents may not have answered all questions.

Average number of hours per week spent onboarding activities

Highestaverage

value


value

Average n = 349 56 95 111 87 304 46 230 99 21

How many hours per week do you personally typically spend on these key onboarding activities?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Company policy training 2 2 2 3 2 2 2 2 2 5

Initial follow-ups (first day, first week, first month, etc.)

2 2 3 3 2 3 2 2 2 5

Introductions (in person, via email, etc.) 2 2 2 2 2 2 2 2 2 2

Onboarding forms 2 3 2 2 2 2 3 2 3 4

Pre-boarding 3 3 3 3 3 3 2 3 3 4

Role-specific training 7 5 7 10 5 8 4 9 4 7

Technology access 3 3 3 2 2 3 4 2 3 5


Note: This question asked respondents to provide values relating to several aspects of the onboarding process. The number of respondents listed for each column in the table above refers to the average number of people who provided an answer for these questions, as some respondents may not have answered all questions.

Average n = 349 56 95 111 87 304 46 230 99 21

How many hours per week do you personally typically spend on these key onboarding activities?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Company policy training 1 1 1 2 2 2 1 2 1 3

Initial follow-ups (first day, first week, first month, etc.)

1 1 1 1 1 1 1 1 1 2

Introductions (in person, via email, etc.) 1 1 1 1 1 1 1 1 1 1

Onboarding forms 1 1 1 1 1 1 1 1 1 2

Pre-boarding 2 2 1 2 2 2 2 2 2 3

Role-specific training 2 1 2 2 2 2 2 2 2 4

Technology access 1 1 1 1 1 1 1 1 1 3

Highestmedian

value


value

Median number of hours per week spent onboarding activities


Appendix E:Performance management



56%

48%

44%

42%

37%

35%

29%

27%

24%

22%

20%

5%

2%

63%

47%

48%

39%

39%

38%

31%

28%

22%

24%

16%

4%

3%

Lack of consistency between managers, departments, etc.

Lack of manager training

Lack of timely or meaningful feedback

Unclear goals / KPIs / OKRs

Lack of personal development plans

Manual processes

Lack of recognition for high performers

Lack of appropriate recognition & rewards

Lack of support for underperformers

Lack of a formal performance framework

Lack of formal processes


I don't know

What are your organisation's key performance management challenges?

2020 (n = 908)

2019 (n = 762)

Performance management key challenges



Summary:

Overall there has been little change in key performance management challenges since 2019. The top three challenges remain the same as in 2020: ‘lack of consistency between managers / departments’; ‘lack of manager training’; and ‘lack of timely and meaningful feedback’.

Insight:

Douglas McGregor highlighted why managers resist conventional performance processes in an article he wrote for Harvard Business Review back in 1957. Those findings essentially mirror the top three challenges still being cited in 2020. This highlights that there have been few significant changes in the approach towards performance management in the last several decades.

While there’s general agreement that performance management is an essential business process, there is division about the best way to manage and carry out the process. Quite often, performance management activities are not seen as valuable by employees or managers. Therefore, HR leaders need to question the true purpose of performance management within their organisation. It can often be broken down into three high-level objectives:

● Compliance● Building skills and potential (capability)● Aligning employees and teams with corporate strategy and goals

When comparing the responses to this question from those who do have fully implemented performance management technology and those who do not, the results show that challenges relating to the general process and formal frameworks are significantly reduced with the use of technology. However, the challenges relating to manager training and capability remain the same. This confirms that technology is not a solution by itself, but can lay the critical foundations for a more efficient performance management process. The key to success, however, is developing managers’ coaching skills and their abilities to have meaningful conversations with their employees, and using the process to create alignment between individual, team and organisational goals.

Action:

● Identify the underlying purpose of performance management in your organisation. Is it about meeting compliance obligations? Is it about aligning personal, team and organisational efforts? Perhaps it’s focused on building skills and capability, or a combination of these and other drivers. Once the purpose is identified, review the processes that help achieve that core purpose.

● Assess how technology can help manage and deliver performance management processes, but don’t stop there. Also review the skills of managers to ensure they can conduct meaningful conversations with employees. Finally, consider whether your corporate culture is open to building continuous performance improvement processes into everyday operations.

https://hbr.org/1972/09/an-uneasy-look-at-performance-appraisal


n = 726 99 183 236 208 630 96 402 258 66




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Lack of a formal performance framework 22% 24% 26% 25% 16% 23% 20% 20% 26% 23%

Lack of appropriate recognition & rewards 27% 30% 36% 23% 20% 27% 24% 25% 28% 32%

Lack of consistency between managers, departments, etc. 56% 64% 60% 58% 48% 58% 48% 45% 70% 74%

Lack of formal processes 20% 17% 19% 20% 23% 22% 13% 20% 21% 17%

Lack of manager training 48% 55% 51% 48% 44% 50% 42% 43% 55% 59%

Lack of personal development plans 37% 30% 36% 39% 38% 38% 29% 32% 43% 39%

Lack of recognition for high performers 29% 31% 34% 26% 26% 30% 23% 25% 30% 47%

Lack of support for underperformers 24% 25% 28% 22% 21% 23% 24% 20% 26% 35%

Lack of timely or meaningful feedback 44% 43% 52% 44% 38% 45% 42% 36% 54% 56%

Manual processes 35% 35% 37% 35% 34% 35% 34% 34% 37% 35%

Unclear goals / KPIs / OKRs 42% 34% 46% 42% 42% 41% 47% 41% 43% 45%


I don't know 2% 8% 3% 0% 1% 2% 3% 3% 2% 0%

Highest value




Highest value






n = 365 n = 188 n = 137 n = 40 n = 361 n = 214 n = 121 n = 26

Lack of a formal performance framework 12% 9% 15% 15% 33% 29% 40% 35%

Lack of appropriate recognition & rewards 21% 23% 18% 25% 32% 26% 40% 42%

Lack of consistency between managers, departments, etc. 56% 44% 66% 78% 57% 46% 74% 69%

Lack of formal processes 9% 6% 12% 10% 32% 33% 31% 27%

Lack of manager training 46% 43% 49% 55% 51% 43% 62% 65%

Lack of personal development plans 31% 28% 35% 30% 43% 36% 52% 54%

Lack of recognition for high performers 27% 25% 23% 48% 30% 24% 38% 46%

Lack of support for underperformers 20% 16% 21% 33% 27% 23% 32% 38%

Lack of timely or meaningful feedback 42% 31% 54% 53% 47% 40% 55% 62%

Manual processes 25% 24% 26% 23% 45% 43% 49% 54%

Unclear goals / KPIs / OKRs 35% 30% 39% 43% 49% 50% 48% 50%


I don't know 2% 4% 1% 0% 2% 3% 2% 0%

Which of the following stages best describes your organisation's current state of HR and payroll and technology for performance management?


67%

53%

49%

26%

26%

9%

8%

7%

2%

68%

51%

54%

23%

21%

9%

10%

N/A

5%

Performance appraisals

Key performance indicators (KPIs) (e.g. specific sales / retention targets)

Personal development plans (PDPs)

360-degree feedback

Objectives & key results (OKRs)

Balanced scorecards

Management by objectives (MBO)

None - we don't manage performance

I don't know

Which of the following methods / paradigms are used to undertake performance management in your organisation?

2020 (n = 707)

2019 (n = 610)

Methods used


Methods used

Summary:

There was no dramatic change in the methods being used to manage performance over the last year, with the top three items from 2019 being carried across to 2020. There was a marginal increase in the use of objectives & key results (OKRs), key performance indicators (KPIs) and personal development plans (PDPs). However, performance appraisals were the most popular method used by some margin.

Insight:

In the wake of COVID-19, it is understandable that HR teams may not have prioritised revamping their performance management processes; however, research undertaken by ELMO in August 2020 suggested that most senior leaders were highly concerned about employee performance and productivity whilst working remotely.

The marginal increase in the use of OKRs is a positive development. OKRs form part of a goal-setting framework that helps organisations define their top strategic priorities, breaking down strategy and execution into two components: objectives (this is the direction or aim); and key results (how those goals will be achieved). OKRs are particularly useful for establishing high-level, yet measurable goals for a business by establishing ambitious outcomes that can be tracked over a set time frame – typically a quarter. The key results are set in performance reviews and are tracked via regularly scheduled performance check-ins.

Action:

● Review existing performance management methods to ensure they are supporting, adding to, and reinforcing overall business objectives.

● Consider exploring and experimenting with different structures and formats to find the right methods, tools and procedures for your organisation, teams and employees.

● With hybrid work likely to continue in the future, ensure existing performance management methods support and are accessible to both on-site and work-from-home employees.

7 in 10 respondents use performance appraisals to track performance

1 in 2 respondents use key performance indicators (KPIs) to track performance

1 in 4 respondents use 360-degree feedback to track performance

https://elmosoftware.com.au/resources/research-reports/elmos-work-from-home-survey/


n = 707 95 177 233 202 616 91 393 250 64




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

360-degree feedback 26% 26% 33% 21% 26% 27% 20% 23% 28% 33%

Balanced scorecards 9% 3% 15% 6% 10% 9% 8% 8% 9% 16%


53% 54% 53% 52% 53% 53% 52% 51% 54% 56%

Management by objectives (MBO) 8% 8% 5% 8% 11% 7% 12% 8% 8% 9%

Objectives & key results (OKRs) 26% 24% 24% 27% 28% 24% 37% 27% 24% 30%

Performance appraisals 67% 75% 66% 69% 63% 68% 66% 63% 72% 75%

Personal development plans (PDPs) 49% 55% 54% 44% 48% 50% 44% 44% 55% 58%

None - we don't manage performance 7% 2% 7% 9% 8% 7% 5% 9% 5% 5%

I don't know 2% 4% 2% 1% 2% 2% 3% 3% 1% 2%

Highest value


Methods used


Highest value





n = 358 n = 185 n = 134 n = 39 n = 359 n = 208 n = 116 n = 25

360-degree feedback 31% 30% 34% 28% 21% 18% 22% 40%

Balanced scorecards 11% 10% 10% 15% 8% 6% 8% 16%


61% 58% 66% 56% 45% 45% 40% 56%

Management by objectives (MBO) 9% 8% 10% 13% 7% 7% 6% 4%

Objectives & key results (OKRs) 31% 32% 29% 31% 22% 22% 18% 28%

Performance appraisals 75% 71% 78% 82% 61% 56% 66% 64%

Personal development plans (PDPs) 57% 51% 64% 62% 42% 37% 45% 52%

None - we don't manage performance 2% 3% 1% 3% 13% 14% 10% 8%

I don't know 1% 1% 1% 3% 3% 4% 1% 0%

Methods used



39%

26%

25%

17%

17%

17%

8%

7%

6%

5%

3%

2%

38%

30%

25%

15%

17%

15%

8%

7%

6%

5%

2%

2%


Performance appraisal completion rates

Employee and manager engagement

Average performance rating

Employee productivity

Morale around performance

Time taken to complete performance appraisals

Termination rate for problem employees

I don't know

Problem employee rate

Rehabilitation rate for problem employees

Average cost of terminating problem employees

Which metric(s) does your organisation use to measure the effectiveness of its performance management

processes?

2020 (n = 704)

2019 (n = 608)

Measuring performance management effectiveness



Summary:

The use of metrics is still limited, only 2 in 5 respondents using metrics to assess the effectiveness of their performance management process. One quarter simply looked at whether an appraisal was completed to measure success.

Insight:

The fact that all listed metrics rate relatively low, with only completion rates as a metric sitting above 25% of respondent usage, indicates uncertainty about what needs to be assessed. HR teams may be unsure on the intent of the performance process or the value it can potentially bring to their organisation. Without this clarity, meaningful metrics cannot be defined to measure success. Value creation, business outcomes, customer satisfaction, employee engagement / morale and team collaboration are suggested as ways to gauge whether an organisation has a successful operating model that develops its employees and improves productivity. It’s critical to clarify your organisation’s goals for performance management. Some common goals include:

● To improve organisational performance● To align individual and organisational objectives● To improve individual performance● To provide the basis for personal development● To inform performance pay decisions

A combination of qualitative and quantitative data is required to gauge the effectiveness of the performance management process. This might be obtained through:

● Carrying out a pulse survey of a selection of employees and managers on their views and experiences of the performance management process and tools and how they have contributed to achieving the desired goals

● Conducting interviews with a sample of employees and managers about their experiences of performance management● Focus groups● Reviewing a sample of objectives and personal development plans for quality● Extracting data and reports from your performance management software (if you have one)

Action:

● Determine the metrics that will most effectively assess the performance management processes used in your organisation. Remember that some metrics can be obtained through other channels, for example, information about employee engagement can be obtained by conducting employee surveys.

● Consider how technology can help with the extraction and analysis of the metrics that matter to your organisation. Also ensure managers have the appropriate skills to undertake effective performance management interventions with employees.


n = 704 95 176 232 201 614 90 390 250 64

Which metric(s) does your organisation use to measure the effectiveness of its performance management processes?



Senior management

C-suite leaders

Australia New ZealandSMB

(1 - 199)Mid-market(200 - 1999)

Enterprise(2000+)

Average cost of terminating problem employees 2% 2% 2% 1% 3% 2% 1% 2% 1% 5%

Average performance rating 17% 17% 21% 16% 16% 18% 13% 16% 17% 28%

Employee and manager engagement 25% 26% 22% 25% 27% 25% 26% 25% 25% 25%

Employee productivity 17% 14% 17% 14% 22% 17% 20% 20% 13% 16%

Morale around performance 17% 14% 17% 16% 18% 15% 27% 18% 14% 20%

Performance appraisal completion rates 26% 26% 28% 29% 21% 28% 18% 22% 32% 33%

Problem employee rate 5% 5% 4% 7% 5% 6% 4% 5% 6% 6%

Rehabilitation rate for problem employees 3% 5% 5% 1% 3% 3% 3% 2% 4% 6%

Termination rate for problem employees 7% 5% 7% 6% 8% 7% 3% 6% 7% 13%

Time taken to complete performance appraisals 8% 4% 11% 6% 10% 9% 4% 8% 8% 11%


I don't know 6% 15% 9% 3% 2% 6% 4% 6% 4% 14%

Highest value




Highest value



Which metric(s) does your organisation use to measure the effectiveness of its performance management processes?


n = 357 n = 184 n = 134 n = 39 n = 347 n = 206 n = 116 n = 25

Average cost of terminating problem employees 3% 4% 1% 8% 1% 1% 1% 0%

Average performance rating 22% 20% 23% 28% 13% 12% 10% 28%

Employee and manager engagement 30% 32% 28% 33% 19% 18% 22% 12%

Employee productivity 18% 21% 15% 18% 16% 19% 11% 12%

Morale around performance 22% 23% 19% 26% 11% 13% 8% 12%

Performance appraisal completion rates 34% 29% 39% 44% 18% 16% 23% 16%

Problem employee rate 6% 5% 6% 8% 5% 4% 6% 4%

Rehabilitation rate for problem employees 4% 3% 4% 10% 2% 1% 3% 0%

Termination rate for problem employees 8% 8% 8% 13% 5% 4% 6% 12%

Time taken to complete performance appraisals 11% 10% 11% 13% 6% 7% 3% 8%


I don't know 7% 7% 4% 21% 5% 5% 5% 4%




1%

5%

14%

24%

31%

5%

6%

0%

7%

1%

1%

5%

10%

26%

37%

4%

7%

1%

5%

2%

Weekly

Monthly

Quarterly

Biannually

Annually

Continuous feedback cycles but no formal appraisal structure

Ad hoc

Project-based appraisals

We don't conduct any performance appraisals

I don't know

How frequently are performance appraisals conducted in your organisation?

2020 (n = 704)

2019 (n = 608)

Frequency of performance appraisals



Summary:

One third of organisations are using annual performance appraisals and one quarter are using a bi-annual (6-monthly) cycle. This is very similar to the results of the 2019 survey. Given that one of the top three performance management challenges is feedback not being timely or meaningful, it is surprising that over 50% of organisations are still locked into undertaking appraisals once or twice a year.

Insight:

The challenge with annual and bi-annual performance appraisals is the risk that goals set more than 6 months ago become less meaningful or even redundant if priorities have been adjusted throughout the course of the year. As outlined in this research by McKinsey, agile organisations understand this and have designed frameworks and operating rhythms that provide constant, almost real-time feedback opportunities that allow for course correction. On a positive note, there are some trends in the right direction, with annual and bi-annual cycles slightly reducing and quarterly cycles slightly increasing, which is likely linked to the emerging trend towards OKRs.

Action:

● Consider the benefits of more frequent performance conversations. The days of annual performance reviews are numbered. Employees expect regular performance conversations with their managers, so consider formally introducing this kind of framework.

● Focus on the desired outcomes of the performance process. Many of the desired outcomes (e.g. increased individual engagement) may already be happening through other processes and strategies within the organisation. Identify these and then build a framework around the aspects that genuinely need more attention, so this does not become a ‘tick the box’ exercise and actually helps people to achieve their own personal goals and ensures that those goals are in line with or contributing to the broader strategic goals of your organisation.

1 in 3 respondents conduct performance appraisals annually

1 in 4 respondents conduct performance appraisals biannually

https://www.mckinsey.com/business-functions/organization/our-insights/performance-management-in-agile-organizations


n = 704 95 176 232 201 614 90 390 250 64




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Weekly 1% 0% 0% 2% 1% 1% 1% 2% 0% 0%

Monthly 5% 7% 3% 5% 5% 5% 3% 5% 5% 2%

Quarterly 14% 14% 13% 13% 17% 15% 14% 16% 14% 9%

Biannually 24% 25% 26% 27% 18% 23% 28% 22% 25% 36%

Annually 31% 32% 33% 31% 30% 31% 30% 29% 33% 34%

Continuous feedback cycles but no formal appraisal structure

5% 2% 7% 3% 8% 5% 6% 6% 4% 6%

Ad hoc 6% 7% 6% 6% 5% 7% 1% 6% 7% 3%

Project-based appraisals 0% 1% 0% 0% 1% 0% 0% 1% 0% 0%

We don't conduct any performance appraisals

7% 4% 5% 7% 9% 7% 6% 7% 8% 5%

I don't know 1% 2% 1% 0% 1% 1% 2% 2% 0% 0%

Highest value




Highest value





n = 357 n = 184 n = 134 n = 39 n = 347 n = 206 n = 116 n = 25

Weekly 1% 3% 0% 0% 1% 1% 0% 0%

Monthly 6% 8% 6% 0% 5% 4% 6% 4%

Quarterly 18% 21% 16% 10% 11% 12% 11% 8%

Biannually 29% 26% 31% 44% 18% 18% 18% 24%

Annually 61% 56% 64% 72% 51% 49% 52% 68%

Continuous feedback cycles but no formal appraisal structure 4% 4% 3% 5% 7% 7% 5% 8%

Ad hoc 2% 2% 1% 3% 10% 9% 13% 4%

Project-based appraisals 0% 0% 0% 0% 1% 1% 0% 0%

We don't conduct any performance appraisals 3% 2% 3% 3% 11% 11% 13% 8%

I don't know 1% 1% 1% 0% 2% 3% 0% 0%




6%

26%

41%

17%

9%

2%

Excellent

Good

Average

Poor

Very poor

I don't know


managing employee performance?

n = 692




Summary:

The responses to this question show that both managers and employees find the performance process onerous and ineffective. Just over half of the respondents (58%) rated their internal systems and processes as either average or poor, and a further 9% said they were very poor.

Insight:

With the overwhelming number of respondents indicating that their performance systems and processes are ‘average’, and employees now expecting regular, meaningful performance conversations, it’s clear that change is overdue in this area.

A comprehensive report written by a group of experts in this area called performance management “the Achilles heel” of HR management. Another article from The Washington Post labelled traditional performance management “corporate kabuki”, specifically referring to its “endless paperwork” as being troublesome. The article suggested the reasons for this extreme dislike include evaluation criteria that is unrelated to the jobs being assessed, and “simplistic and quota-driven ratings used to label the performance of otherwise complex, educated human beings”. Therefore, it is not surprising that, although survey respondents said that they spent a lot of time on performance management, roughly two thirds felt that their processes and systems were average or below average.

Technology is not the sole answer to this issue. HR teams cannot implement performance management technology and expect it to generate an effective process for them automatically. At a higher level, performance management is about organisational alignment. The company’s culture and management capability play an important role in developing an effective performance management process. This is something technology alone cannot improve.

Instead of enforcing traditional approaches to performance management that have not fundamentally changed in decades, leaders need to play a different role, by acting as facilitators and enablers of high performance, removing barriers to performance, and providing career pathways and guidance to their team members.

Action:

● Change the focus of performance management from being merely a box-ticking exercise. Concentrate on embedding performance-related conversations into the culture of the organisation and ensure managers have the capability to undertake performance-related interventions, including having difficult conversations, with employees.

● Before implementing a new framework, pilot a few different structures with different teams and review their effectiveness. Think of ways to make performance management bottom-up and driven by employees. People tend to make better decisions when they are motivated and empowered to take ownership of their own development.

● Ensure leaders endorse and support any new framework or approach to performance management. ● Once a suitable framework has been defined, ensure technology and tools are in place to support the end-to-end performance management process.

http://www.hrmaturity.com/wp-content/uploads/2013/06/SHRM-Perf-Mgmt-EPG-FINAL-for-web.pdf

https://www.washingtonpost.com/national/on-leadership/the-corporate-kabuki-of-performance-reviews/2013/02/14/59b60e86-7624-11e2-aa12-e6cf1d31106b_story.html


n = 703 95 176 231 201 613 90 389 250 64

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing employee performance?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Excellent 6% 8% 3% 5% 8% 6% 6% 8% 4% 0%

Good 26% 22% 29% 21% 30% 25% 29% 29% 24% 14%

Average 41% 47% 40% 43% 38% 42% 39% 38% 44% 53%

Poor 17% 12% 15% 22% 14% 16% 18% 16% 16% 17%

Very poor 9% 8% 10% 10% 7% 9% 6% 7% 11% 13%

I don't know 2% 2% 3% 0% 2% 1% 3% 2% 0% 3%

Highest value




Highest value




Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing employee performance?


n = 357 n = 184 n = 134 n = 39 n = 346 n = 205 n = 116 n = 25

Excellent 8% 11% 5% 0% 4% 6% 3% 0%

Good 38% 45% 33% 21% 13% 14% 14% 4%

Average 41% 34% 47% 54% 42% 40% 41% 52%

Poor 10% 8% 12% 15% 23% 24% 22% 20%

Very poor 2% 1% 3% 5% 16% 12% 20% 24%

I don't know 1% 1% 0% 5% 2% 3% 1% 0%



Note: This question asked respondents to provide values relating to several aspects of the performance management process. The number of respondents listed for each column in the table above refers to the average number of people who provided an answer for these questions, as some respondents may not have answered all questions.

Average number of hours per year spent conducting performance appraisals

Highestaverage

value


value

Average n = 349 56 95 111 87 304 46 230 99 21

How many hours per year is spent conducting performance appraisals by each of the following roles?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Employees 67 38 48 122 29 56 137 24 38 717

HR team members 39 48 35 39 40 38 53 35 28 138

People managers 76 80 70 103 48 59 179 32 56 528


Note: This question asked respondents to provide values relating to several aspects of the performance management process. The number of respondents listed for each column in the table above refers to the average number of people who provided an answer for these questions, as some respondents may not have answered all questions.

Median n = 429 50 105 150 124 372 57 246 149 33

How many hours per year is spent conducting performance appraisals by each of the following roles?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Employees 5 5 5 5 5 5 5 5 5 8

HR team members 10 8 11 10 10 10 12 10 10 13

People managers 16 20 20 16 15 17 15 15 20 17

Highestmedian

value


value

Median number of hours per year spent conducting performance appraisals


Appendix F:Succession management



Succession management key challenges

Summary:

In the general section of this report, 13% of respondents said succession planning was expected to be a top challenge for their organisation in 2021. This was on par with the percentage of respondents who said they would be challenged by performance management (13%) or recruitment (12%), yet the investment into performance management and recruitment technology remains substantially higher than succession management technology.

In 2020, only 21% of organisations had a form of succession management technology fully implemented, which was the lowest volume of implementation for any HR technology type. This figure increased only marginally from 2019 when implementation volume was at 15%. Implementation rates of succession management technology are broadly the same regardless of the organisation size. At best, 1 in 3 enterprise organisations said they use a form of succession management technology.

Insight:

The 2020 survey results reinforced the belief that HR teams are struggling to find time to spend on succession planning, let alone do it well. According to an article published by Forbes in 2019, 2 in 3 organisations do not have a succession management strategy in place. For most organisations, succession management is seen as an aspirational part of HR’s remit; it appears there are always more pressing issues that end up taking precedence. However, 59% of respondents said their organisation intends to invest in this kind of technology within the next 12 months, which reflects widespread awareness about the benefits of effective succession management.

Action:

● Addressing succession planning will help retain talent, drive employee engagement, and enable more operational continuity when employee churn occurs in critical roles. HR must communicate these benefits to the wider business – especially senior leadership.

● Prioritising succession discussions can be challenging with so many competing priorities. If it is difficult to find a starting point, don’t assume a comprehensive solution is required. Instead, try to initiate career path questions in existing activities such as performance reviews, or remuneration cycles.

13% 13%

12%

Sucession planning Recruitment Performance management

% of respondents who cited these as top challenges

for their organisation in 2021

15% 14% 18% 15%21% 18%

29%21%

SMB Mid-market Enterprise Overall

% of organisations with fully implemented succession

planning technology

2019 2020

https://www.forbes.com/sites/johnwelsheurope/2019/01/14/7-steps-to-successful-succession-planning/?sh=3b69975145fb


33%

29%

28%

25%

25%

22%

20%

18%

17%

17%

10%

7%

29%

32%

33%

28%

24%

21%

27%

20%

23%

19%

6%

6%

Lack of professional development opportunities

Weak talent pipeline


Lack of resources

Lack of time

Lack of budget

External talent shortage

New or emerging roles

Weak bench strength

No buy-in from senior leadership

I don't know


What are your organisation's key succession management challenges?

2020 (n = 645)

2019 (n = 492)




Summary:

Between 2019 and 2020, there were several changes to the key challenges relating to succession management. The first change relates to the availability of talent – this was seen in the reduced number of respondents who selected ‘external talent shortage’, ‘weak talent pipeline’ or ‘weak bench strength’ as key challenges. The second noteworthy change was the increase in respondents who selected ‘lack of professional development opportunities’ as a key challenge.

Insight:

The reduction in challenges relating to talent availability – either internally or externally – indicates there may be more organisations out there getting a better handle on succession management. This shift is also likely related to the pandemic and subsequent economic recession, which saw most organisations freeze recruitment and cut non-essential jobs and budgets. As workforce reductions were made, the external talent pool began to increase. Employees who were retained were more likely to remain withtheir employer in 2020 whilst the economic situation was uncertain, potentially improving succession bench strength and the overall talent pipeline. However, it’s also timely to consider any constraints in relation to succession management. This might include the resources required to run leadership development programs and reduced opportunity for internal role transfers, given COVID-19 lockdown and other unexpected cost constraints.

Action:

● Succession management must be prioritised in 2021. With professional development taking a backseat in many organisations throughout 2020 due to budgetary and operational constraints, and with employment markets looking stronger in the short-to-mid term, employers will need to be conscious of maintaining bench strength in the first half of 2021.

● Consider how technology can assist. When responses were broken down by those who did and did not use a form of succession management technology, the results showed that technology does a lot to support HR teams with their succession management strategy. For example, it helps to clarify the professional development opportunities available and identify new / emerging roles for potential successors. It also makes the record keeping of skills, experience and qualifications much easier, which may also be why respondents who use technology are less challenged by a lack of time or resources.

1 in 3 respondents said a lack of professional development opportunities was their biggest

succession management challenge

Less than 1 in 10 respondents said they had no challenges relating to

succession management


n = 645 81 155 221 188 563 82 356 229 60




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

External talent shortage 20% 11% 19% 22% 22% 20% 21% 19% 22% 18%

Lack of budget 22% 14% 28% 22% 22% 23% 18% 20% 24% 28%

Lack of professional development opportunities

33% 28% 39% 32% 32% 33% 38% 30% 37% 38%


Lack of time 25% 26% 26% 19% 29% 24% 29% 20% 32% 23%

New or emerging roles 18% 15% 21% 18% 16% 18% 17% 17% 20% 18%

No buy-in from senior leadership 17% 20% 19% 19% 12% 17% 17% 16% 17% 22%


28% 37% 32% 27% 23% 29% 22% 19% 38% 43%

Weak bench strength 17% 12% 12% 20% 20% 17% 17% 13% 22% 23%

Weak talent pipeline 29% 17% 30% 29% 34% 30% 26% 25% 32% 45%


I don't know 10% 20% 14% 10% 2% 10% 10% 11% 7% 13%

Highest value




Highest value






n = 121 n = 62 n = 42 n = 17 n = 524 n = 294 n = 187 n = 43

External talent shortage 21% 19% 21% 24% 19% 18% 22% 16%

Lack of budget 19% 19% 21% 12% 23% 20% 25% 35%

Lack of professional development opportunities 21% 21% 24% 18% 36% 32% 40% 47%

Lack of resources 15% 13% 19% 12% 27% 20% 35% 44%

Lack of time 20% 16% 21% 29% 26% 21% 34% 21%

New or emerging roles 25% 24% 29% 18% 16% 15% 18% 19%

No buy-in from senior leadership 9% 8% 10% 12% 19% 17% 19% 26%


12% 5% 24% 6% 32% 22% 41% 58%

Weak bench strength 17% 5% 26% 41% 17% 15% 21% 16%

Weak talent pipeline 26% 23% 24% 47% 30% 26% 34% 44%


I don't know 9% 8% 5% 24% 10% 12% 7% 9%

Which of the following stages best describes your organisation's current state of HR and payroll and technology for succession management?


55%

13%

13%

11%

11%

9%

9%

9%

7%

7%

6%

2%

51%

15%

14%

10%

15%

11%

13%

11%

6%

9%

9%

3%


Percentage of roles filled internally

Retention rate of high-potential / high-performance employees

I don't know

Turnover amongst high-potential / high-performance employees

Time taken to fill vacant roles

Engagement levels of high-potential / high-performance employees

Manager satisfaction with quality of internal candidates

Diversity amongst identified or placed successors

Bench strength

Ratio of internal to external hires for critical roles

Cost rate of high-potential / high-performance employees

Which metric(s) does your organisation use to measure the effectiveness of its succession management

processes?

2020 (n = 644)

2019 (n = 491)

Measuring process effectiveness



Summary:

Overall, the results for this question indicated a regression in the use of succession management metrics between 2019 and 2020. More than half of respondents ‘actively involved in’ or ‘responsible for’ succession management said they do not use any metrics to assess how effective their succession management processes are. This indicates that most HR teams are unsure about the true objectives and desired outcomes for their succession management efforts.

The only metric that increased in use was ‘diversity amongst identified or placed successors’, which reflects the increased focus on diversity and inclusion in specific roles and industries. No specific metric stood out from the rest as a potential ‘best practice’ metric.

Insight:

The key reason that succession management is so challenging and tends to fall by the wayside in favour of other competing priorities is that the types of data and metrics required to paint a holistic picture of a potential successor needs to be sourced from a variety of processes and systems, including those relating to performance management and professional development. Pulling this data together can be an extremely time-consuming and complex process. Workforce analytics has surged, especially in larger organisations, which has created more data and more complexity leading to even more confusion about how to do this well.

Action:

● Select the metrics that most effectively assess succession management processes in your organisation. Some of these metrics may be easier to obtain and track with the aid of technology – for example, ‘percentage of roles filled internally’ or ‘retention rate of high-potential / high-performance employees’. When looking at the responses to this question from those who do use succession management technology and those who don’t, it was evident that technology makes the availability or ease of sourcing metrics much easier.

1 in 2 respondents do not use any metrics to

measure the effectiveness of their succession

management process


n = 644 80 155 221 188 562 82 356 228 60

Which metric(s) does your organisation use to measure the effectiveness of its succession management processes?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Bench strength 7% 5% 5% 7% 8% 7% 2% 5% 7% 10%

Cost rate of high-potential / high-performance employees

2% 3% 1% 3% 3% 2% 6% 2% 3% 5%

Diversity amongst identified or placed successors

7% 5% 5% 9% 9% 8% 6% 6% 8% 17%

Engagement levels of high-potential / high-performance employees

9% 9% 5% 10% 11% 8% 13% 10% 9% 5%

Manager satisfaction with quality of internal candidates

9% 5% 6% 11% 9% 8% 10% 8% 11% 5%

Percentage of roles filled internally 13% 13% 10% 14% 13% 13% 10% 11% 14% 17%

Ratio of internal to external hires for critical roles

6% 8% 7% 4% 5% 6% 2% 3% 7% 17%

Retention rate of high-potential / high-performance employees

13% 13% 7% 16% 13% 13% 12% 10% 17% 12%

Time taken to fill vacant roles 9% 10% 9% 12% 6% 9% 12% 8% 10% 17%

Turnover amongst high-potential / high-performance employees

11% 11% 9% 13% 12% 11% 11% 9% 14% 15%


I don't know 11% 25% 21% 8% 2% 12% 10% 11% 9% 23%

Highest value




Highest value




Which metric(s) does your organisation use to measure the effectiveness of its succession management processes?


n = 121 n = 62 n = 42 n = 17 n = 523 n = 294 n = 186 n = 43

Bench strength 17% 10% 14% 24% 5% 4% 6% 5%

Cost rate of high-potential / high-performance employees 7% 6% 7% 6% 2% 1% 2% 5%

Diversity amongst identified or placed successors 17% 15% 17% 29% 5% 4% 6% 12%

Engagement levels of high-potential / high-performance employees 12% 16% 10% 6% 8% 8% 9% 5%

Manager satisfaction with quality of internal candidates 17% 18% 21% 6% 7% 5% 9% 5%

Percentage of roles filled internally 19% 19% 19% 18% 11% 9% 13% 16%

Ratio of internal to external hires for critical roles 13% 6% 14% 35% 4% 2% 6% 9%

Retention rate of high-potential / high-performance employees 27% 26% 33% 18% 9% 7% 13% 9%

Time taken to fill vacant roles 8% 8% 10% 6% 9% 7% 10% 21%

Turnover amongst high-potential / high-performance employees 21% 18% 26% 24% 9% 7% 11% 12%


I don't know 13% 6% 12% 41% 11% 12% 8% 16%



38%

26%

25%

21%

17%

13%

9%

6%

37%

31%

29%

20%

21%

10%

8%

9%

None - we have no succession plans in place

Senior-level Management

Leadership / C-level

Key specialist / technical roles

Mid-level Management

Junior to mid-level (individual contributors)

I don't know

Long-serving employees (not C-level)

Which of the following employee levels in your organisation have a succession plan in place?

2020 (n = 644)

2019 (n = 490)

Where succession is used


Summary:

Out of the 644 respondents who said they were ‘actively involved in’ or ‘responsible for’ succession management, 1 in 3 said they did not have any succession plans in place. Roughly a quarter had succession plans in place for senior-level Management roles and leadership / C-level roles. One fifth had plans in place for key specialist / technical roles.

Insight:

The above statistic about not having any succession plans in place remained unchanged since 2019 and speaks volumes about succession management being aspirational for most HR teams. Of note in 2020 was the decline in succession planning for C-suite, senior and mid-level Management roles, and the increase in succession planning for junior to mid-level and key specialist / technical roles. Whilst management roles still make up the majority of roles that HR teams focus their succession planning efforts on, the increase in junior to mid-level and key specialist / technical roles for which succession plans are in place reflects an emerging awareness of how succession management can be used to drive employee engagement and retention throughout the organisation.

Action:

● Identify ‘at risk’, critical roles within your organisation – those roles which cannot be filled easily if the current occupant were to leave the organisation or move to a different position. Can retention and engagement strategies be targeted and used to keep these ‘at risk’ employees within your workforce?

● Assess whether other employees within your workforce have the skills, experience and desire to be groomed for these key roles. If no one is suitable, consider creating a pool of externally sourced talent as part of a strategic approach to talent management. Keep track of potential candidates working elsewhere who may be suitable for these roles in the future.

Where succession is used

1 in 3 respondents have no

succession plans in place


n = 644 80 155 221 188 562 82 356 228 60




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Junior to mid-level (individual contributors) 13% 13% 9% 13% 15% 13% 9% 13% 14% 8%

Key specialist / technical roles 21% 16% 19% 25% 20% 21% 23% 20% 20% 30%

Leadership / C-level 25% 19% 20% 26% 30% 26% 17% 20% 29% 38%

Long-serving employees (not C-level) 6% 5% 4% 4% 10% 6% 5% 7% 4% 5%

Mid-level Management 17% 16% 19% 18% 14% 17% 13% 14% 20% 22%

Senior-level Management 26% 25% 25% 28% 24% 26% 22% 18% 33% 43%

None - we have no succession plans in place 38% 29% 37% 37% 42% 37% 44% 41% 37% 18%

I don't know 9% 26% 17% 4% 2% 9% 9% 9% 7% 17%

Highest value


Succession management programs


Highest value


Succession management programs




n = 121 n = 62 n = 42 n = 17 n = 523 n = 294 n = 186 n = 43

Junior to mid-level (individual contributors) 23% 19% 29% 24% 10% 11% 10% 2%

Key specialist / technical roles 36% 31% 40% 41% 18% 18% 16% 26%

Leadership / C-level 41% 34% 50% 47% 21% 17% 25% 35%

Long-serving employees (not C-level) 17% 18% 17% 12% 3% 4% 2% 2%

Mid-level Management 35% 34% 36% 35% 13% 10% 17% 16%

Senior-level Management 43% 34% 48% 65% 22% 14% 30% 35%

Other 8% 5% 10% 18% 2% 2% 2% 2%

None - we have no succession plans in place 12% 19% 7% 0% 43% 46% 44% 26%

I don't know 7% 6% 7% 12% 10% 10% 8% 19%



3%

12%

30%

28%

18%

9%

Excellent

Good

Average

Poor

Very poor

I don't know


managing succession planning?

n = 644




Summary:

Only 1 in 7 respondents rated their succession planning systems and processes as excellent or good, in contrast to nearly 1 in 2 who said they were poor or very poor. When the responses to this question were looked at in terms of those who use succession management technology and those who do not, 1 in 2 respondents using technology rated their systems and processes as excellent or good in comparison to just 1 in 12 who did not use technology.

Insight:

In comparison to every equivalent question for the other HR topics examined in this report, the above figures indicate succession management is the most poorly regarded area within HR’s remit. Organisations often lack clarity about what they want their succession planning strategy to deliver, which was evident in their inability to measure effectiveness. Furthermore, the events of 2020 forced many organisations to re-evaluate their business operations, which pushed succession management even further down the priority list.

Succession planning does not need to be addressed in isolation from other HR activities and the desire to overcome these challenges may be achieved via complementary HR tools and processes. However, dedicated succession planning software is designed to provide a holistic view of a person. Without it, HR teams are mining data from multiple sources (e.g. performance management systems, L&D platforms etc.) to paint a picture about an individual’s capability. Technology is also making metrics easier for HR teams to access and analyse to measure the effectiveness of their succession management processes.

Action:

● Re-assess the key drivers for succession planning within the business. For example, there may be a desire to reduce the risk of having roles vacant for an extended period, or perhaps it’s about enhancing employee engagement by providing career pathways. These drivers are often not unique to succession – there may be similar drivers behind the desire to enhance performance management and professional development.

● Evaluate the critical roles that could benefit from a succession plan and review the development opportunities on offer to prepare people for these roles. Consider how a succession management process could improve engagement and retention. Instead of launching complex, all-encompassing succession plans, starting with simple solutions (including building career path conversations into performance appraisals) may be sufficient in the short term, or until the economy shores up again.


n = 644 80 155 221 188 562 82 356 228 60

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing succession planning?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Excellent 3% 3% 0% 2% 8% 3% 2% 4% 2% 0%

Good 12% 8% 7% 15% 14% 12% 12% 13% 11% 8%

Average 30% 23% 29% 33% 31% 31% 26% 30% 31% 30%

Poor 28% 26% 28% 29% 27% 28% 28% 29% 26% 28%

Very poor 18% 21% 22% 15% 16% 18% 20% 13% 24% 25%

I don't know 9% 20% 14% 5% 4% 8% 12% 11% 5% 8%

Highest value




Highest value




Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing succession planning?


n = 121 n = 62 n = 42 n = 17 n = 523 n = 294 n = 186 n = 43

Excellent 12% 16% 10% 0% 1% 2% 1% 0%

Good 35% 42% 29% 24% 7% 7% 8% 2%

Average 34% 26% 38% 53% 29% 31% 30% 21%

Poor 13% 11% 14% 18% 31% 32% 29% 33%

Very poor 3% 2% 5% 6% 21% 16% 28% 33%

I don't know 3% 3% 5% 0% 10% 13% 5% 12%



Appendix G:Learning & development (L&D)



Learning & development key challenges

42%

28%

27%

25%

23%

22%

22%

19%

18%

18%

10%

6%

5%

43%

36%

27%

24%

18%

21%

25%

21%

18%

23%

9%

6%

5%

Lack of budget / funding

Lack of resources

Aligning training with corporate goals

Lack of senior leadership buy-in

Low learner engagement

Providing access to learning content

Difficulty demonstrating the ROI of training

Finding the right external partners

Meeting compliance obligations

Training program logistics

Difficulty scaling


I don't know

What are your organisation's key learning & development (L&D)

challenges?

2020 (n = 729)

2019 (n = 595)

Summary:

Learning & development remains a focus for many organisations. Earlier in this report, when asked about the top challenges for the next 12 months, 26% of respondents said upskilling, cross-skilling or reskilling employees was high on the list. Leadership development was also rated highly, indicating that professional development in general is high on corporate agendas. In terms of challenges, ‘lack of budget / funding’ saw a slight decline compared with 2019. Just under half of enterprise respondents (48%) said ‘lack of budget / funding’ was their top challenge, compared with 46% of mid-market respondents and 39% of SMB respondents. More significant was the reduced number of respondents who cited ‘lack of resources’ as a challenge. This was cited by 28% of respondents in 2020 vs. 36% in 2019. Other challenges, including difficulty scaling, low learner engagement and lack of leadership buy-in, saw slight increases.

Insight:

Organisations had to dramatically re-evaluate priorities in 2020 as they faced new challenges and were more focused on short-term solutions. This was not surprising, given the uncertainty experienced by most businesses and the wider economy throughout 2020.

With workforce downsizing a sad reality in many workplaces in 2020, many employees had to take on new responsibilities, which may have required them to upskill or reskill. Many employees are likely to have been seeking opportunities to upskill or re-skill in 2020 as a result of workforce downsizing, causing some employees to take on new responsibilities or to shift their focus from looking for promotion opportunities to simply holding onto their jobs. In addition, some learning was driven by compliance obligations, for example, around health and safety in a COVID-19 world.his has implications for how organisations resource and plan learning.



With just under a quarter of respondents selecting ‘low learner engagement’ as a challenge, employers should be attempting toassess and improve learner engagement. While there are many elements that impact learner engagement (e.g. instructor competence, intuitive course design, etc.), low engagement may also suggest issues unique to virtual learning delivery. With face-to-face learning it’s much easier to look around a room, gauge engagement and make changes. In a virtual learning world, this is challenging but not impossible. Surveys conducted following a learning initiative are a good way to assess its value andgather feedback.

Finally, the impact and value of learning is being re-evaluated and this is generating new expectations. For example, organisations are likely looking at metrics such as productivity improvements as a result of any learning initiatives undertaken.

Action:

● Maintain focus. The PwC CEO Survey, 2020 indicated that 78% of CEOs believe the availability of key skills is a top threat to growth. Therefore, a continued focus on building a skilled workforce that can drive and deliver what the organisation needs is a key part of sustaining operations through challenging periods.

● Adopt new learning modes. Learner engagement must be prioritised in a hybrid work environment. A LinkedIn reportsuggested that learners engage in the following ways:

- 52% at the point of need- 47% in the evenings and weekends- 42% at the office desk- 30% when alerted to updates- 27% on the way to and from work

● Assess impact. Learning modes are changing and organisations will need to improve how they measure and understand impact so that they can make the smartest choices around the tools and platforms implemented.

1 in 4 respondents are still challenged

by a lack of leadership buy-in

3 in 7 respondents are still challenged

by a lack of budget or funding

https://www.pwc.com.au/ceo-agenda/ceo-survey.html

https://learning.linkedin.com/resources/workplace-learning-report-2018


n = 729 122 176 229 202 627 102 404 258 67

What are your organisation's key learning & development (L&D) challenges?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Aligning training with corporate goals 27% 34% 28% 27% 22% 26% 29% 25% 29% 30%


22% 23% 20% 24% 20% 23% 17% 20% 23% 30%

Difficulty scaling 10% 11% 11% 10% 9% 10% 12% 9% 11% 12%

Finding the right external partners 19% 19% 15% 20% 20% 19% 16% 22% 15% 13%

Lack of budget / funding 42% 37% 47% 35% 48% 41% 45% 39% 46% 48%


Lack of senior leadership buy-in 25% 25% 32% 25% 17% 24% 25% 23% 27% 28%

Low learner engagement 23% 24% 34% 17% 21% 23% 23% 21% 27% 22%

Meeting compliance obligations 18% 18% 18% 17% 21% 19% 17% 16% 19% 31%

Providing access to learning content 22% 18% 20% 23% 24% 22% 20% 20% 25% 21%

Training program logistics 18% 12% 18% 17% 23% 19% 13% 16% 22% 21%


I don't know 5% 12% 5% 3% 1% 5% 4% 5% 3% 13%

Highest value




Highest value



What are your organisation's key learning & development (L&D) challenges?


n = 297 n = 131 n = 123 n = 43 n = 432 n = 273 n = 135 n = 24

Aligning training with corporate goals 23% 31% 31% 33% 30% 22% 27% 25%


21% 31% 29% 28% 22% 14% 18% 33%

Difficulty scaling 9% 14% 12% 14% 11% 7% 10% 8%

Finding the right external partners 18% 35% 17% 12% 19% 15% 13% 17%

Lack of budget / funding 36% 55% 47% 42% 46% 31% 44% 58%


Lack of senior leadership buy-in 25% 33% 25% 28% 24% 18% 28% 29%

Low learner engagement 25% 29% 33% 16% 22% 17% 21% 33%

Meeting compliance obligations 20% 18% 15% 28% 18% 15% 22% 38%

Providing access to learning content 15% 23% 25% 14% 27% 19% 25% 33%

Training program logistics 16% 22% 20% 19% 20% 12% 23% 25%


I don't know 4% 6% 2% 9% 5% 4% 3% 21%

Learning & development key challengesWhich of the following stages best describes your organisation's current state of HR and payroll

and technology for Learning and development?


75%

60%

58%

58%

32%

10%

3%

81%

70%

54%

48%

15%

9%

2%

Face-to-face learning (internal)

Face-to-face learning (external)

eLearning courses (internal)

eLearning courses (external)

Virtual classrooms

Massive open online courses (MOOCs)

I don't know

How is learning & development (L&D) delivered in your organisation?

2020 (n = 714)

2019 (n = 586)

Delivery of learning & development



Summary:

Compared with data from 2019, internal face-to-face delivery declined by 6 percentage points; similarly, external face-to-face delivery fell by 10 percentage points. This contrasts to the rise in virtual classrooms, which increased by 17 percentage points. Both internal and external eLearning course delivery also showed increases. There is a geographic difference in the use of virtual classrooms in the use of virtual classrooms in New Zealand (17%) vs. Australia (35%) – indeed, Australia appears to haveadopted all forms of eLearning much more than New Zealand.

Insight:

COVID-19 saw a significant shift in how, where and when work was undertaken. Many employees were forced to work from home and many employers adopted hybrid work models, with some employees working on premises and others continuing to work from home. It’s also likely that these survey results reflect the wider adoption of independent learning strategies wherebyemployees undertake learning as and when they desire it – which is only possible via eLearning solutions. Research from Grant Thornton suggests that eLearning will boom in the COVID-19 recovery phase, thanks in part to the rise in mobile platforms, gamification, 3D environments, social learning, data analytics and artificial intelligence.

It’s likely that a blended approach to learning catering to both on and off-site will continue. While the implementation of learning & development technology does not reduce the need for face-to-face learning delivery, it means a multi-modal or blended approach is required to engage people with learning. This in itself requires some adjustments to learning delivery.

Action:

● Adopt and adapt to new learning methods. For example, video-conferencing tools should be utilised to ensure face-to-face learning continues, regardless of where employees are based. Blended learning requires the facilitator to have experience or knowledge in inclusive delivery i.e. talking to the camera to make eye contact with those on screen and using interactive tools like breakout rooms.

● Consider using a Learning Management System (LMS), as this can help facilitate blended learning. For example, an LMS can be used to deliver pre-course and course content, and then be used to schedule in-person training sessions (virtually, if not in the same location) to share experiences with and through others.

3 in 4 respondents use face-to-face

learning (internal)

6 in 10 respondents use eLearning courses

(internal and external)

https://www.consultancy.uk/news/25130/elearning-to-boom-in-post-pandemic-economy


n = 714 117 173 226 198 616 98 396 253 65




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Virtual classrooms 32% 33% 32% 31% 33% 35% 17% 23% 44% 43%

Face-to-face learning (internal) 75% 74% 74% 77% 72% 75% 70% 70% 79% 83%

Face-to-face learning (external) 60% 60% 59% 63% 58% 61% 55% 57% 63% 71%

Massive open online courses (MOOCs) 10% 8% 10% 11% 11% 11% 5% 10% 11% 11%

eLearning courses (internal) 58% 66% 61% 58% 52% 61% 43% 46% 71% 85%

eLearning courses (external) 58% 56% 55% 62% 57% 59% 51% 58% 58% 57%

I don't know 3% 5% 2% 3% 4% 3% 6% 4% 2% 0%

Highest value




Highest value





n = 293 n = 130 n = 121 n = 42 n = 421 n = 266 n = 132 n = 23

Virtual classrooms 40% 28% 50% 50% 27% 20% 39% 30%

Face-to-face learning (internal) 80% 79% 80% 83% 71% 65% 79% 83%

Face-to-face learning (external) 63% 60% 65% 67% 58% 55% 61% 78%

Massive open online courses (MOOCs) 13% 14% 12% 14% 8% 8% 9% 4%

eLearning courses (internal) 75% 62% 86% 88% 46% 38% 58% 78%

eLearning courses (external) 65% 67% 64% 62% 53% 53% 52% 48%

I don't know 0% 0% 0% 0% 5% 6% 5% 0%


Which of the following stages best describes your organisation's current state of HR and payroll and technology for learning and development?


55%

52%

45%

45%

25%

20%

17%

14%

11%

8%

8%

2%

7%

48%

48%

44%

44%

22%

20%

14%

8%

13%

5%

7%

3%

7%

Technical skills / certifications

Workplace health and safety (WHS)

Compliance

Induction

Ethics and conduct

Customer service

Equal employment opportunity (EEO)

Business management

Project management

Productivity

Finance

Sustainability

I don't know

What are the most common courses (by volume) undertaken by your employees?

2020 (n = 707)

2019 (n = 585)

Most common courses undertaken by staff



Summary:

In terms of the courses being undertaken, ‘technical skills / certifications’ rose from 48% in 2019 to 55% in 2020. ‘Workplace health and safety (WHS)’ also increased from 48% to 52%, with mid-level managers in particular focused on this area. There was a slightly stronger focus on ‘productivity’ (5% in 2019 vs. 8% in 2020) and ‘ethics and conduct’ (22% in 2019 vs. 25% in 2020). ‘Business management’ also increased 6 percentage points.

Insight:

There has been a subtle shift over the last year in the skills people want to develop through work-related learning. For employers, 2020 was not just about meeting compliance obligations but also about maintaining motivation and productivity while remote working. It’s interesting to note that ‘compliance’ training only rose marginally, as COVID-19 no doubt resulted in more ‘tick the box’ L&D activities in 2020 that didn’t previously exist, for example, raising COVID-19 awareness and practical courses such as how to wash hands properly, etc. It’s possible this unexpected training is reflected in the increase in ‘workplace health and safety (WHS)’ courses in 2020. The data indicates that WHS training has been undertaken by employees at all levels, but mid-level management have taken the lead. This is not surprising, as they have had to manage remote employees and ensure their health and safety is maintained.

Other research backs up the rise of holistic health being a concern for employers. MetLife’s 2020 Employee Benefits Trends study, which compared employee wellbeing both before and during COVID-19, found that stress and burnout were the biggest concerns for employees. It also found that frequent feelings of stress and burnout directly resulted in a 73% decline in productivity, engagement and loyalty.

The increased focus on areas such as ‘technical skills / certifications’ and ‘business management’ also reflects that in some ways 2020 provided more opportunities for employees to undertake learning they may have previously delayed. Given the new working conditions many employees found themselves in during the year – for example, remote working – they may have been more open to undertaking eLearning without having to deal with the distractions of the workplace and the commute to and from work. Research by Josh Bersin suggests that although people may be time poor and may struggle to find the time for formal learning, informal learning done during the course of the work day will continue to rise.

Action:

● Don’t lose sight of the bigger picture. While it makes sense that learning should be used to address immediate concerns, longer term issues such as change management and project managementshould not be dropped. These are key areas that will require development in the coming 12 months and beyond.

● Redefine ‘critical roles’ and the skills needed for those roles. Gartner research suggests that before COVID-19, critical roles were viewed as roles with critical skills, or the capabilities an organisationneeded to meet its strategic goals. While this is still the case, employers now realise there is another category of critical roles: those that are crucial to the success of essential workflows. For example,IT admin skills may not be central to an organisation’s core business, but are critical to supporting a remote or hybrid workforce. Leaders will need to develop succession plans and appropriate trainingfor these business-critical roles in the future.

● Maintain the focus on WHS, as well as employee wellbeing. There has been a major increase in wider community talk as well as research about mental health, and it seems today employers are more willing to provide support for employees who are struggling with this. It has become an ethical issue – see more in this article citing Gartner research.

https://www.metlife.com/employee-benefit-trends/ebts2020-holistic-well-being-drives-workforce-success/

https://joshbersin.com/2018/06/a-new-paradigm-for-corporate-training-learning-in-the-flow-of-work/

https://www.insidehr.com.au/future-of-work-trends-for-a-post-covid-19-world/

https://www.insidehr.com.au/future-of-work-trends-for-a-post-covid-19-world/


n = 707 117 171 223 196 610 97 392 250 65

What are the most common courses (by volume) undertaken by your employees?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Business management 14% 10% 14% 13% 17% 14% 13% 14% 15% 11%

Compliance 45% 43% 46% 51% 41% 47% 37% 40% 52% 54%

Customer service 20% 15% 22% 20% 22% 20% 19% 21% 19% 22%

Equal employment opportunity (EEO) 17% 15% 19% 19% 14% 20% 2% 14% 20% 29%

Ethics and conduct 25% 22% 27% 26% 22% 26% 15% 20% 26% 45%

Finance 8% 11% 8% 6% 6% 8% 5% 9% 6% 3%

Induction 45% 38% 50% 52% 36% 45% 40% 39% 52% 46%

Productivity 8% 9% 8% 6% 11% 7% 12% 8% 8% 11%

Project management 11% 13% 9% 11% 11% 11% 9% 11% 12% 9%

Sustainability 2% 3% 1% 4% 3% 2% 2% 3% 2% 3%

Technical skills / certifications 55% 44% 55% 61% 53% 54% 61% 56% 56% 43%

Workplace health and safety (WHS) 52% 50% 57% 52% 49% 52% 52% 48% 57% 62%

I don't know 7% 15% 6% 4% 5% 6% 7% 6% 6% 11%

Highest value




35%

33%

29%

29%

22%

22%

18%

16%

11%

7%

38%

34%

28%

32%

21%

18%

16%

18%

13%

7%

Training completion rates

Meeting compliance obligations / targets


Percentage of employees trained / certified / etc.

Improvement in overall employee engagement / productivity

Improvement in individual engagement / productivity

Improvement in team engagement / productivity

Training cost per employee

Knowledge achieved (via formal exams)

I don't know

Which metric(s) does your organisation use to measure the effectiveness of its learning & development

(L&D) activities?

2020 (n = 714)

2019 (n = 586)

Measuring learning & development effectiveness



Summary:

Training completion rates continue to be the most widely used measure of effectiveness for training; however, even this form of measurement declined in 2020 by 3 percentage points. Other declines included ‘meeting compliance obligations / targets’ and ‘percentage of employees trained / certified’. It’s worth noting that organisations with a fully implemented technology solution saw close to a 15 percentage point increase in the use of training completion rates as a metric. In most instances, especially for SMB and mid-market respondents, the use of metrics increased for those with fully implemented technology. Just under a third of all respondents (29%) still do not use any metrics to measure the effectiveness of learning & development initiatives.

Insight:

It’s significant that such a high percentage of respondents do not use any metrics to assess learning effectiveness. Indeed, the only areas to see a slight increase in 2020 were metrics related to employee or team engagement. This suggests there is recognition that investing in employees’ skills has a direct contribution to the overall health of an organisation. It could also be a recognition that informal learning –particularly learning on the job – cannot be assessed by traditional measures alone. Like any other area of business operations, using metrics to prove the value of learning will be essential to future investment.However, 2018 research found that only 8% of CEOs report that they see the business impact of L&D programs, and just 4% see the ROI. Data released by LinkedIn in May 2020 revealed that CEOs were actively championing learning programs 43% more than they did in 2019. Ongoing support of such programs will be dependent on leaders receiving a holistic view of learning – and that includes basic metrics.

Wider metrics relating to productivity and engagement may be more challenging to link specifically to learning interventions, as there will be other elements to consider in gauging success in these areas, but this will improve as more sophisticated data analysis and ‘cross-pollination’ of data sets takes place. Technology such as a Learning Management System (LMS) can provide easy access to data so that organisations can keep track of overall learning impact.

Action:

● Ensure that your organisation has an effective means of evaluating the effectiveness of learning & development activities. There are many tools you can use for this. One example is the framework provided by the Kirkpatrick Model created in 1958 introduced four key ways to assess the impact of learning, all of which still resonate today. In summary:

- Reaction: What the learner’s thoughts, feelings and opinions are regarding the training.- Learning: The increase in the learner’s knowledge and skill.- Behavioural change: The level of change in the learner’s behaviour in the workplace.- Results: The overall change in the organisation due to training.- Potential payoff: A few years after it was first introduced, the Kirkpatrick model was extended to include a fifth level of measurement. This ties the potential payoff (i.e. the return on investment) to

the outcomes of a training program. It was an acknowledgement that linking training outcomes to business goals was critical.

● When assessing online learning, consider these metrics: course completions, learner satisfaction surveys, minutes of learning completed per employee per month, repeat visits to the LMS per month, qualitative feedback about behavioural change.

https://learning.linkedin.com/resources/workplace-learning-report-2018

https://learning.linkedin.com/resources/leading-with-learning?trk=lil-blog-business

https://educationaltechnology.net/kirkpatrick-model-four-levels-learning-evaluation/


n = 714 117 173 226 198 616 98 396 253 65

Which metric(s) does your organisation use to measure the effectiveness of its learning & development (L&D) activities?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Improvement in individual engagement / productivity

22% 21% 17% 24% 23% 22% 16% 25% 19% 11%


22% 18% 20% 26% 22% 22% 20% 23% 23% 11%

Improvement in team engagement / productivity

18% 15% 16% 21% 19% 19% 15% 18% 20% 11%

Knowledge achieved (via formal exams) 11% 8% 9% 15% 10% 11% 9% 10% 11% 12%

Meeting compliance obligations / targets 33% 32% 32% 33% 33% 33% 32% 27% 38% 46%

Percentage of employees trained / certified / etc.

29% 23% 29% 31% 29% 29% 27% 24% 32% 46%

Training completion rates 35% 37% 39% 33% 32% 36% 29% 24% 43% 62%

Training cost per employee 16% 13% 14% 17% 19% 17% 11% 15% 15% 26%


I don't know 7% 20% 8% 3% 2% 6% 9% 5% 7% 14%

Highest value




Highest value



Which metric(s) does your organisation use to measure the effectiveness of its learning & development (L&D) activities?


n = 391 n = 392 n = 393 n = 394 n = 395 n = 396 n = 397 n = 398

Improvement in individual engagement / productivity 25% 32% 21% 12% 20% 22% 17% 9%


27% 32% 26% 12% 19% 19% 20% 9%

Improvement in team engagement / productivity 22% 27% 21% 12% 15% 14% 19% 9%

Knowledge achieved (via formal exams) 15% 17% 13% 14% 8% 7% 10% 9%

Meeting compliance obligations / targets 40% 34% 45% 43% 28% 24% 31% 52%

Percentage of employees trained / certified / etc. 38% 35% 39% 43% 23% 18% 27% 52%

Training completion rates 48% 38% 55% 60% 25% 18% 33% 65%

Training cost per employee 19% 20% 18% 21% 14% 13% 13% 35%


I don't know 6% 5% 6% 14% 7% 6% 8% 13%


Which of the following stages best describes your organisation's current state of HR and payroll and technology for learning & development?


n = 706 117 170 223 196 609 97 391 250 65

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing learning & development (L&D) for all employees?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Excellent 7% 10% 5% 6% 9% 7% 9% 7% 8% 6%

Good 27% 22% 31% 28% 26% 27% 27% 27% 29% 23%

Average 40% 41% 42% 35% 43% 39% 44% 40% 39% 42%

Poor 17% 14% 13% 23% 15% 17% 14% 19% 15% 14%

Very poor 7% 7% 7% 7% 6% 7% 2% 6% 7% 8%

I don't know 2% 6% 2% 1% 1% 2% 3% 2% 2% 8%

Highest value





Summary:

While 34% of overall respondents rated their internal systems and processes as good or excellent, the remainder rated them as average or worse. Slightly more SMBs rated their systems and processes as poor (19%) or very poor (6%), while mid-market respondents were more content, with the highest number of respondents rating their systems and processes as good (29%) or excellent (7%). There were expected disparities by industry. ‘Electricity, gas, water and waste services’ (18%) and ‘construction’ (19%) gave the lowest ratings (‘very poor’). Industries with the highest ratings (‘excellent’) were ‘accommodation and food services’ (17%) and ‘professional, scientific and technical services’ (13%).

Insight:

Clearly, work still needs to be done to ensure the learning needs of employees are being addressed. This general dissatisfaction is reflected in other industry research. PwC’s ‘New World. New Skills’ survey for example showed that 69% of employees are prepared to learn new skills or completely re-train in order to improve their future employability. However, only 23% were upskilling through their employer.

When it comes to professional development, HR is caught in the middle. Gartner research from 2020 indicates that 60% of HR leaders report pressure from the CEO to ensure employees have the skills needed in the future. At the other end of the spectrum, compared with three years ago, 69% of HR executives report more pressure from employees to provide development opportunities that will prepare them for future roles.

Apart from ‘accommodation and food services’, which appeared in both the lowest and highest ratings, the industries with the lowest ratings have a large percentage of workers that would primarily be on site and have limited time and access to the resources needed to complete learning-related tasks. The highest rated industries have a large percentage of workers who are desk-bound and can undertake learning from anywhere at any time; however, eLearning via mobile or tablet could still be effective for geographically dispersed blue-collar workers.

Action:

● Survey employees about the learning opportunities they would like to see, how learning should be delivered, and the variety of topics or subjects that need to be offered. The World Economic Forum’s Future of Jobs Report, released in October 2020, suggested that 50% of all employees will need reskilling by 2025, as adoption of technology increases. However, while technical skills remain critical, soft skills – perhaps more accurately described as ‘essential skills’ – should also be prioritised. The World Economic Forum’s report showed that employers believe critical thinking and problem-solving skills will grow in prominence in the next 5 years, while newly emerging skills in 2020 included active learning, resilience, stress tolerance and flexibility.

● Wherever possible, ensure learning is tablet and mobile friendly. This allows for learning on the go and is ideal for hybrid workforces split between the physical workplace and the home.

https://www.pwc.com/gx/en/issues/upskilling.html

https://www.gartner.com/en/newsroom/press-releases/2020-08-19-gartner-hr-research-finds-employees-are-only-applying-54-percent-of-newly-learned-skills

https://www.weforum.org/reports/the-future-of-jobs-report-2020


Highest value




Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing learning & development (L&D) for all employees?


n = 391 n = 392 n = 393 n = 394 n = 395 n = 396 n = 397 n = 398

Excellent 12% 13% 14% 5% 4% 5% 2% 9%

Good 40% 43% 39% 33% 18% 19% 20% 4%

Average 38% 37% 39% 40% 41% 41% 39% 43%

Poor 6% 6% 4% 12% 24% 25% 24% 17%

Very poor 2% 1% 3% 2% 10% 8% 11% 17%

I don't know 2% 1% 1% 7% 3% 2% 3% 9%

Which of the following stages best describes your organisation's current state of HR and payroll and technology for learning & development?


Note: This question asked respondents to provide values relating to several aspects of the learning & development process. The number of respondents listed for each column in the table above refers to the average number of people who provided an answer for these questions, as some respondents may not have answered all questions.

Average monthly hours spent on learning & development activities

Highestaverage

value


value

Average n = 305 43 75 102 84 263 42 176 103 26

How many hours per month do you personally spend on these key learning & development (L&D) activities?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Administering employee participation / completion

5 5 5 4 5 5 4 4 6 7

Compliance-related activities 6 6 6 6 5 5 8 5 5 11

Conducting training needs analysis 4 5 5 4 4 4 4 4 5 7

Delivering / presenting course materials 7 10 6 9 5 7 10 5 9 14

Developing / creating course materials 10 15 11 11 7 10 16 8 14 15

Developing L&D strategies 6 6 6 6 4 6 5 4 6 12

Reporting 4 5 5 4 4 4 8 4 4 9

Researching materials, methods, etc. 8 9 11 7 7 8 11 7 9 17



Average n = 305 43 75 102 84 263 42 176 103 26

How many hours per month do you personally spend on these key learning & development (L&D) activities?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Administering employee participation / completion

2 3 2 2 2 2 2 2 3 3

Compliance-related activities 2 4 2 2 2 2 5 2 2 5

Conducting training needs analysis 2 2 2 2 2 2 2 2 2 5

Delivering / presenting course materials 3 3 3 2 3 2 4 2 4 5

Developing / creating course materials 5 4 4 5 5 5 4 4 5 5

Developing L&D strategies 2 4 3 2 2 2 2 2 3 4

Reporting 2 2 2 2 2 2 2 2 2 5

Researching materials, methods, etc. 5 5 5 5 4 5 5 4 5 5

Highestmedian

value


value

Median monthly hours spent on learning & development activities



Average time and cost spent on training per year

Highestaverage

value


value

Average n = 504 69 119 168 148 433 71 297 168 39

Learning & development OverallJunior to mid-

levelMid-level

managementSenior

managementC-suite leaders



(1 - 199) (200 - 1999) (2000+)

How many days does a typical employee in your organisation spend undertaking formal training (i.e. training that takes them away from their daily role) per year?

7 6 8 7 6 7 6 7 6 10

Average n = 237 20 36 93 88 203 34 148 80 9

What is the average annual cost of training an employee (post-probation and excluding any onboarding-related training costs)?

6595 9133 2019 7505 6927 6615 6475 5377 8665 8222



Average n = 504 69 119 168 148 433 71 297 168 39

Learning & development OverallJunior to mid-level


Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

How many days does a typical employee in your organisation spend undertaking formal training (i.e. training that takes them away from their daily role) per year?

4 3 5 4 3 4 4 4 3 5

Average n = 237 20 36 93 88 203 34 148 80 9

What is the average annual cost of training an employee (post-probation and excluding any onboarding-related training costs)?

1500 1750 1125 2000 1500 1500 1000 1500 1100 8000

Highestmedian

value


value

Median time and cost spent on training per year


Median time and cost spent on training per year

Summary:

Employees undertake a median of 4 days per year of learning across all business sizes, with enterprise businesses undertaking slightly more at 5 days and mid-market organisations slightly less at 3 days. However, it costs enterprise businesses more than 5 times more per employee compared to their smaller counterparts. This may be a reflection of the amount of on-the-job training undertaken in smaller businesses, which may negate the need for ‘formal’ learning. The median annual cost spent on training per employee in Australia is $1500 and in New Zealand it’s less at $1000.

Insight:

Benchmarking against industry peers in relation to time and cost spent on training per year is an invaluable way to understand how an organisation measures up. It can also help to identify what they need to focus on to remain up to date and competitive.

The comparatively high cost of training in enterprise businesses perhaps reflects the fact they have dedicated in-house resources to facilitate and provision training. SMBs and mid-market organisations will tend to outsource these roles. This cost blowout for enterprise organisations is perhaps also indicative of the challenges relating to cost-effective scaling up to suit a larger population. It’s also worth considering if enterprise respondents are simply more likely to track cost closely and have the tools, resources and functionality to do so. For all organisations regardless of size, learning technology provides access to metrics, making assessment of time and money spent on training much easier.

There were also anticipated variations between industries, with some committing more days to learning & development than others. For example, at the upper end of the spectrum is ‘agriculture, forestry and fishing’ (8 days), while ‘construction’ and ‘wholesale trade’ are at the lower end (2 days).

Action:

● Determine what learning initiatives will produce the best outcomes for employees and the business. In terms of the results of this survey, a median of 4 days is spent on training per person per year. Do those 4 days present the best value for money? Perhaps there are smarter ways to deliver learning, or different subjects required to best meet the evolving needs of employees and the organisation. It’s also worth considering the Pareto principle, which states that 80% of gain comes from 20% effort – so make sure that 20% of learning effort truly improves learners’ skills in terms of outcomes such as productivity, engagement, and so on.

● Consider other ways to improve the ROI of learning. Only 25% of respondents to a survey by McKinsey said that training measurably improved performance. However, simple tips such as getting leaders on board, reinforcing new skills in the workplace and measuring the impact of learning via participant feedback can improve the ROI of learning.

● Doing more with less requires careful planning and budgeting. Instead of rigidly scheduled formal learning, consider if informal learning, delivered in bite-sized chunks on a daily or weekly basis, or mentoring or coaching might be more effective and cost-effective.

https://www.forbes.com/sites/kevinkruse/2016/03/07/80-20-rule/?sh=180d31e63814

https://www.mckinsey.com/business-functions/organization/our-insights/getting-more-from-your-training-programs


Appendix H:Rewards & recognition (R&R)



R&R technology

Summary:

In comparison to all other types of HR technology, rewards & recognition (R&R) technology experienced the largest growth in implementation from 2019 to 2020. Implementation levels grew from 25% to 39%, an increase of 56%. This trend was seen across all organisation sizes but was especially apparent for enterprise organisations. If the number of respondents with fully implemented R&R technology is added to the number of respondents who said they were currently implementing or planning to implement R&R technology within 12 months, it can be projected that 69% of organisations will have implemented R&R technology by the end of 2021 (based on 2020 data).

While the priority level of R&R did not change at all between 2019 and 2020, the availability of budget still increased from 61% to 73%. This means that 3 in 4 organisations will be investing (or continuing to invest) in R&R in 2021.

Insight:

These results indicate that senior leadership buy-in to the concept of R&R is reaching a point where R&R is being viewed as a fundamental part of managing people and an important component of a successful culture. Just a few years ago, HR was still struggling to get senior leadership buy-in for R&R programs. As initiatives like employee feedback surveys saturated the market and became one of the key measurements of an engaged and motivated culture, so too did the awareness that R&R was one of the most influential drivers of engagement. In simple terms, “just making people feel valued” is one of the most basic building blocks of any type of relationship, be it professional or personal.

Action:

● Consider building a genuine, meaningful relationship with your employees by implementing an R&R program. Employers who want highly engaged workforces need to start viewing the connection between employer and employee as more than a contract to perform certain tasks for money. The employer-employee relationship must be built on mutual trust and respect. Take the time to understand what motivates and drives employees – and then build an R&R program that capitalises on these insights by offering personalised rewards.

● R&R programs don’t need big budgets. Don’t underestimate the motivational power of a simple ‘thanks for a job well done’ from a manager.

58% 61%58%73%

% who said R&R was a high or medium

priority

% who have budget allocated for R&R

2019 2020

23% 26% 30% 25%39% 37% 38% 48%

SMB Mid-market Enterprise Overall

% of organisations with fully implemented R&R technology

2019 2020


26%

10%

24%

28%

41%

16%

40%

18%

51%

13%

2%

23%

12%

16%

30%

40%

12%

39%

18%

49%

13%

2%

Achieving KPIs

Customer service

Employee of the month / week / quarter

Incentive programs

Informal / ad hoc

Learning & development completion

Peer nomination awards

Sales quota achievement

Tenure / work anniversaries

None - we have no formal programs in place

I don't know

What kinds of rewards and recognition programs does your organisation currently have in place?

2020 (n = 632)

2019 (n = 532)

R&R programs


R&R programs

Summary:

The three most common types of R&R programs used across Australia and New Zealand were: recognition of tenure / work anniversaries, informal / ad-hoc types of recognition, and peer nomination awards. The ranking of these 3 programs was the same as 2019. Whilst ad hoc types of recognition were equally common for organisations of all sizes, the use of tenure anniversaries and peer nomination programs was significantly more prevalent for mid-market and enterprise organisations.

The strongest emerging trend was the use of ‘employee of the week / month / quarter’, which increased by 8 percentage points to 24%. The use of these programs was slightly more widespread amongst larger organisations, but only marginally.

1 in 7 SMB organisations do not have any form of R&R program in place, in comparison to roughly 1 in 10 mid-market or enterprise organisations. Respondents using R&R technology were more likely to have formal R&R programs in place, especially mid-market and enterprise organisations. Organisations without technology leaned more on informal / ad hoc forms of R&R.

Insights:

The rising popularity of ‘employee of the week / month / quarter’ initiatives was the most noteworthy development because this type of recognition program often takes minimal effort to implement and has a high level of visibility amongst employees. The key challenge when implementing this type of program is making sure it is seen as fair and not rigged by favouritism. If an R&R program is deemed unfair, then the program can do more damage than good to employee morale, so it is critical to design a program that makes the nomination and selection criteria completely transparent and equally available to all employees. Many ‘employee of the week / month / quarter’ programs are run off the back of peer-to-peer recognition programs, where leaders select winners based on the volume or quality of peer nominations.

Actions:

● Consider how technology can assist with R&R programs. Technology supports a variety of R&R programs by making the process of nominating and selecting employees for recognition more streamlined, consistent, and transparent. Technology can also automate some types of recognition – e.g. notifications about nominations and / or selections, sending “thank you” and “congratulations” emails on certain dates, etc.

● Beyond technology, effective recognition will always come down to authentic human praise. This ultimately places accountability back on managers and leaders. ● HR teams need to invest time into coaching managers and leaders about the types of recognition available to them and how different types of recognition will motivate people. A

personalised approach (e.g. publicly, privately, verbally, with incentives etc.) can produce better results.


n = 632 92 141 212 187 559 73 349 226 57




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Achieving KPIs 26% 28% 21% 28% 27% 26% 29% 26% 27% 28%

Customer service 10% 12% 9% 9% 11% 10% 11% 11% 8% 12%

Employee of the month / week / quarter 24% 22% 23% 23% 27% 24% 21% 20% 27% 33%

Incentive programs 28% 26% 29% 27% 30% 29% 23% 24% 33% 40%

Informal / ad hoc 41% 46% 38% 41% 43% 40% 52% 42% 41% 40%

Learning & development completion 16% 18% 14% 19% 14% 17% 12% 17% 16% 14%

Peer nomination awards 40% 52% 42% 38% 35% 40% 40% 31% 50% 61%

Sales quota achievement 18% 12% 13% 20% 21% 18% 19% 18% 19% 14%

Tenure / work anniversaries 51% 64% 48% 49% 49% 51% 52% 42% 62% 60%

None - we have no formal programs in place 13% 10% 15% 10% 15% 13% 8% 15% 9% 11%

I don't know 2% 5% 2% 1% 0% 2% 1% 3% 1% 0%

Highest value


R&R programs


Highest value


R&R programs




n = 249 n = 138 n = 81 n = 30 n = 383 n = 211 n = 145 n = 27

Achieving KPIs 33% 34% 32% 30% 22% 20% 23% 26%

Customer service 15% 16% 12% 17% 7% 8% 6% 7%

Employee of the month / week / quarter 29% 23% 35% 43% 20% 18% 23% 22%

Incentive programs 32% 28% 38% 37% 26% 21% 30% 44%

Informal / ad hoc 38% 40% 40% 27% 43% 43% 42% 56%

Learning & development completion 20% 21% 21% 17% 14% 15% 13% 11%

Peer nomination awards 49% 44% 54% 60% 34% 22% 47% 63%

Sales quota achievement 21% 22% 20% 17% 16% 15% 18% 11%

Tenure / work anniversaries 54% 47% 64% 60% 49% 39% 61% 59%

None - we have no formal programs in place 5% 6% 4% 7% 17% 21% 12% 15%

I don't know 2% 4% 1% 0% 1% 2% 1% 0%

Which of the following stages best describes your organisation's current state of HR and payroll and technology for rewards and recognition?


28%

24%

43%

32%

28%

18%

27%

18%

12%

19%

22%

24%

10%

5%

24%

22%

44%

34%

26%

22%

29%

19%

12%

17%

20%

22%

9%

7%

Discretionary effort is not recognised or rewarded

High performers are not recognised or rewarded

Inconsistency (e.g. across managers, departments, etc.)

Lack of budget

Lack of insight into what rewards employees would value

Lack of peer-to-peer recognition

Lack of personalised rewards & recognition

Lack of resources

Lack of time

Low engagement with program

Over-reliance on financial reward

Recognition is not timely


I don't know


2020 (n = 632)

2019 (n = 532)

R&R key challenges


R&R key challenges

Summary:

Inconsistency in how recognition is given or applied to formal programs was by far the greatest challenge when it came to R&R in 2020. 1 in 3 SMB respondents found this challenging, but this challenge was cited more often by larger organisations. 1 in 2 mid-market and 3 in 5 enterprise organisations said inconsistency was a challenge for them.

Enterprise organisations were also more challenged by the need to provide timely recognition, low engagement with R&R programs, the R&R of high performers, and giving personalised forms of R&R. These results were not surprising because very large organisations are trying to scale R&R programs that need a certain level of personalisation and authenticity to be truly successful.

Roughly 1 in 3 organisations said a lack of budget was a key challenge for them. This ratio did not vary by organisation size.

Insights:

Whilst employee expectations around appreciation and recognition are nothing new, the way in which recognition is delivered has to meet the needs of the workforce that exists today. In 2020, 50% of the global workforce are Millennials (those born between 1980 and 2000), who are more accustomed to receiving instantaneous, high-frequency and individualised feedback. This has led to a greater number and variety of recognition tools being made available to managers. While recognition ultimately falls under the remit of managers and leaders, it’s HR’s role to provide the tools to support this process and guidance to managers about how to utilise these tools effectively. The types of recognition appreciated by a Millennial is likely to be very different to a Baby Boomer (those born between 1946 and 1964). For this reason, consistency across departments and managers is always going to be a challenge, but it is not insurmountable. It’s more critical to have overarching processes and mechanisms that are transparent and consistent, and managers who are coached on how to give recognition fairly and within the context of the organisation’s desired outcomes. After all, there is only so much that HR can control beyond the systems and processes put in place.

Actions:

● Consider the culture that your organisation wants to develop and what outcomes are expected before designing and implementing any form of R&R program. Implementing ‘out of the box’ R&R programs via technology may not have the desired outcomes if the impact on culture and perceived fairness has not been considered first.

● Ensure the foundations of robust communication and manager / leader coaching plans are in place. These are vital to ensure that R&R programs are viewed as authentic and fair, and not tokenistic. The value of verbal praise and appreciation cannot be understated and sometimes the greatest value an organisation can gain comes from coaching leaders on how to give authentic recognition in a timely manner.

● Remember that recognition does not have to be done in isolation from other HR activities. For example, a good performance management conversation will recognise the areas that an employee or team are doing well and can also be used to provide constructive feedback about areas where further development is needed. A balance of praise and ideas to develop further can be the perfect formula to drive higher levels of engagement.


n = 632 92 141 212 187 559 73 349 226 57




Senior management

C-suite leaders Australia New Zealand


(1 - 199) (200 - 1999) (2000+)

Discretionary effort is not recognised or rewarded 28% 25% 31% 30% 24% 28% 25% 22% 35% 39%

High performers are not recognised or rewarded 24% 18% 28% 27% 20% 25% 14% 20% 25% 44%

Inconsistency (e.g. across managers, departments, etc.) 43% 42% 46% 46% 39% 44% 37% 34% 53% 60%

Lack of budget 32% 30% 35% 30% 33% 32% 36% 30% 37% 30%

Lack of insight into what rewards employees would value

28% 21% 28% 34% 24% 28% 27% 26% 30% 37%

Lack of peer-to-peer recognition 18% 14% 21% 19% 17% 19% 15% 16% 18% 32%

Lack of personalised rewards & recognition 27% 33% 27% 31% 21% 27% 29% 25% 27% 44%


Lack of time 12% 12% 11% 11% 14% 13% 4% 11% 12% 18%

Low engagement with program 19% 21% 21% 19% 17% 20% 12% 16% 18% 40%

Over-reliance on financial reward 22% 16% 20% 24% 24% 21% 27% 20% 26% 18%

Recognition is not timely 24% 20% 22% 26% 25% 25% 18% 18% 27% 46%


I don't know 5% 8% 4% 5% 4% 5% 7% 6% 4% 2%

Highest value


R&R key challenges


Highest value


R&R key challenges




n = 249 n = 138 n = 81 n = 30 n = 383 n = 211 n = 145 n = 27

Discretionary effort is not recognised or rewarded 18% 13% 23% 27% 34% 27% 41% 52%

High performers are not recognised or rewarded 17% 13% 17% 33% 29% 25% 29% 56%

Inconsistency (e.g. across managers, departments, etc.) 37% 30% 46% 47% 47% 37% 57% 74%

Lack of budget 28% 26% 33% 23% 35% 32% 39% 37%

Lack of insight into what rewards employees would value 19% 17% 21% 20% 34% 31% 34% 56%

Lack of peer-to-peer recognition 12% 10% 14% 17% 22% 20% 21% 48%

Lack of personalised rewards & recognition 20% 17% 22% 33% 32% 30% 30% 56%


Lack of time 8% 7% 10% 10% 15% 14% 13% 26%

Low engagement with program 23% 19% 20% 50% 16% 14% 17% 30%

Over-reliance on financial reward 20% 17% 25% 17% 23% 21% 26% 19%

Recognition is not timely 20% 14% 23% 37% 26% 21% 29% 56%


I don't know 4% 5% 2% 3% 5% 7% 4% 0%

Which of the following stages best describes your organisation's current state of HR and payroll and technology for rewards & recognition?


8%

34%

36%

16%

5%

12%

28%

33%

18%

9%

Very high

High

Neutral

Low

Very low

In your opinion, what is the level of value that Senior Management (e.g. CEO, Directors) places on recognition

programs?

2020 (n = 632)

2019 (n = 532)

Value placed on R&R by senior leaders



Summary:

In 2020, roughly 2 in 5 respondents said their senior leaders placed a high or very high value on R&R programs in comparison to 1 in 3 back in 2019. In addition, 1 in 3 respondents said their senior leaders placed a neutral value on R&R programs – this ratio is unchanged since 2019. Also of note, 1 in 5 respondents said their senior leaders placed a low or very low value on R&R programs in comparison to 1 in 4 back in 2019. These results show that senior leadership support for R&R programs increased between 2019 and 2020.

Insights:

One of the main reasons senior leaders do not buy into the value of R&R programs is the difficulty in demonstrating return on investment. It can be difficult for HR teams to secure the funding they need for an R&R program, especially when they are competing with other departments and projects for funding. However, these results clearly show that HR teams are having more success getting senior leaders on board, because there were twice as many respondents who said their leaders placed a high or very high value on R&R than respondents who said their leaders placed a low or very low value on it. Research from multiple sources demonstrates the value of investing in R&R. For example, this report from Deloitte shows:

● Organisations with recognition programs in place see 14% higher levels of employee engagement, productivity and performance.

● A 15% improvement in engagement can result in 2% increase in margins.● Recognition is among the top three most effective non-financial factors for retention.

Action:

● To persuade leaders to fund R&R programs, it’s critical to present a compelling business case, backed by real numbers. There are plenty of resources online that can be used to build a business case, including ELMO’s own business case template.

2 in 5 respondents said their senior

management team placed ‘high’ or ‘very high’

value on recognition programs

1 in 5 respondents said their senior management

team placed a ‘low’ or ‘very low’ value on

recognition programs

https://www2.deloitte.com/ie/en/pages/deloitte-private/articles/recognition-programmes.html

https://elmosoftware.com.au/resources/templates-calculators/business-case-template/


n = 632 92 141 212 187 559 73 349 226 57

In your opinion, what is the level of value that Senior Management (e.g. CEO, Directors) places on recognition programs?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Very high 8% 12% 4% 7% 11% 9% 7% 9% 8% 4%

High 34% 27% 31% 34% 39% 34% 32% 34% 32% 37%

Neutral 36% 39% 36% 34% 37% 36% 38% 34% 42% 30%

Low 16% 20% 21% 18% 10% 16% 16% 18% 14% 18%

Very low 5% 2% 9% 7% 3% 5% 7% 5% 4% 12%

Highest value




Highest value




In your opinion, what is the level of value that Senior Management (e.g. CEO, Directors) places on recognition programs?


n = 249 n = 138 n = 81 n = 30 n = 383 n = 211 n = 145 n = 27

Very high 14% 15% 14% 7% 5% 6% 5% 0%

High 53% 58% 51% 40% 35% 34% 34% 41%

Neutral 30% 26% 35% 37% 40% 38% 46% 22%

Low 16% 16% 15% 23% 25% 27% 19% 37%

Very low 2% 1% 2% 0% 8% 7% 5% 26%



6%

17%

16%

12%

14%

10%

9%

5%

9%

51%

9%

5%

18%

13%

9%

19%

8%

6%

3%

10%

51%

8%

Consistency across managers, departments, etc.

Employee participation rate

Employee performance

Employee productivity

Employee retention

Manager participation rate

Program costs

Program reach

Reward / recognition frequency per employee


I don't know

Which metric(s) does your organisation use to measure the effectiveness of its rewards & recognition

processes?

2020 (n = 632)

2019 (n = 532)

Measuring R&R program effectiveness



Summary:

Overall, 1 in 2 respondents said their organisation does not use any metrics to measure the effectiveness of their R&R program, and this ratio did not vary greatly by organisation size.

When comparing the data for the use of technology and the use of metrics, only 1 in 3 respondents using R&R technology said they use no metrics, in comparison to 2 in 3 respondents who do not have technology. Those who use technology utilise a very diverse range of metrics – indeed, there was no specific metric that stood out as being common best practice.

Insights:

These results are somewhat concerning because the lack of metrics indicates that many HR teams do not clearly define the expected outcomes of R&R programs before designing and implementing them, which means that they don’t actually know what to measure. It also shows how challenging it can be for HR teams to link R&R back to business outcomes and demonstrate the ROI. This is not helped by the fact that the metrics outlined above can be difficult to trace back directly to an R&R program. It’s more likely that a mixture of different elements will combine to improve employee productivity and performance for example.

Actions:

● Rewards & recognition initiatives and activities can vary immensely in format, frequency and scale. This also means the impacts will not be centralised or translate into single metrics. Organisations can increase their awareness by firstly identifying what initiatives relate to rewards & recognition, and defining for each initiative what a success metric may be. If these are reviewed frequently, they will help define a baseline for expectations, especially if supported with engagement surveys, employee retention and performance metrics, and other data sources in the organisation.

1 in 2 of the respondents use tenure or work

anniversaries as an opportunity to reward and

recognise employees

4 in 7 respondents have implemented or are

currently implementing rewards & recognition

technology. 1 in 7 are not even considering it


n = 632 92 141 212 187 559 73 349 226 57

Which metric(s) does your organisation use to measure the effectiveness of its rewards & recognition processes?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Consistency across managers, departments, etc. 6% 3% 4% 7% 9% 6% 4% 7% 5% 7%

Employee participation rate 17% 14% 18% 17% 16% 18% 7% 17% 17% 14%

Employee performance 16% 9% 21% 14% 17% 16% 14% 17% 12% 18%

Employee productivity 12% 8% 14% 12% 12% 13% 5% 14% 9% 9%

Employee retention 14% 12% 12% 15% 15% 14% 10% 15% 13% 11%

Manager participation rate 10% 7% 9% 10% 12% 11% 3% 10% 10% 11%

Program costs 9% 8% 9% 9% 9% 10% 3% 7% 10% 16%

Program reach 5% 4% 4% 6% 7% 6% 0% 4% 7% 9%

Reward / recognition frequency per employee 9% 12% 10% 9% 9% 10% 8% 10% 9% 9%


I don't know 9% 20% 12% 8% 3% 9% 10% 9% 7% 16%

Highest value




Highest value




Which metric(s) does your organisation use to measure the effectiveness of its rewards & recognition processes?


n = 249 n = 138 n = 81 n = 30 n = 383 n = 211 n = 145 n = 27

Consistency across managers, departments, etc. 9% 10% 7% 10% 4% 5% 3% 4%

Employee participation rate 24% 26% 21% 23% 12% 11% 15% 4%

Employee performance 23% 27% 20% 17% 10% 11% 8% 19%

Employee productivity 18% 23% 14% 10% 8% 8% 7% 7%

Employee retention 18% 20% 20% 10% 11% 11% 10% 11%

Manager participation rate 13% 14% 12% 10% 8% 7% 8% 11%

Program costs 11% 10% 12% 13% 8% 5% 9% 19%

Program reach 10% 7% 12% 13% 3% 1% 4% 4%

Reward / recognition frequency per employee 16% 17% 15% 10% 5% 5% 6% 7%


I don't know 11% 12% 7% 20% 8% 8% 7% 11%



6%

19%

35%

22%

13%

5%

Excellent

Good

Average

Poor

Very poor

I don't know


managing rewards & recognition?

n = 632




Summary:

Only 1 in 4 respondents rated their R&R systems and processes as good or excellent, in comparison to 1 in 3 respondents who thought they were poor or very poor. This means that negative ratings are outweighing the positive ratings. When comparing the data reported by organisations of different sizes, mid-market organisations were the least satisfied, with 2 in 5 rating their systems and processes as poor or very poor.

Insights:

Whilst data presented earlier in this section showed that HR teams are steadily improving their ability to convince senior leaders of the value of R&R programs, these results suggest there is still ample room for improvement in the R&R programs currently in place. There are a number of reasons why R&R programs are not being used to their fullest potential:

● HR teams are not clearly defining the expected outcomes from their R&R programs and are therefore unable to measure their success.● There are interdependencies and complexities that make it hard to demonstrate the ROI, which makes senior leaders question the value

and investment into R&R programs.● Many HR teams are potentially using ‘out the box’ vendor-designed R&R programs without considering the uniqueness of their

organisation’s own needs and culture.● Once R&R programs have been implemented, HR teams are realising that they are not being perceived as fair by some employees.● HR teams are relying too much on R&R systems and processes and not spending enough time coaching managers and leaders on how

to effectively give recognition.

Actions:

Start with the end in mind. Highlight what is important to the organisation and be very clear about what outcomes an R&R program is meant to produce. Here are four key questions to ask:

● What does the organisation want to recognise? Tenure? Performance? Living up to and living company values?● What behaviours does the organisation want to encourage and drive?● What support or coaching do managers / leaders need to fully leverage the potential of the program?● What outcomes is the organisation looking for that can be a measure of success for the program?

Over half of the respondents said

they do not use any metrics to

assess the effectiveness of their

rewards & recognition program

+


n = 632 92 141 212 187 559 73 349 226 57

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing rewards & recognition?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Excellent 6% 7% 4% 4% 10% 6% 5% 8% 3% 4%

Good 19% 22% 13% 19% 24% 20% 15% 21% 17% 23%

Average 35% 28% 42% 37% 32% 34% 44% 35% 36% 33%

Poor 22% 24% 22% 26% 17% 23% 19% 19% 28% 18%

Very poor 13% 12% 14% 11% 13% 13% 10% 12% 12% 19%

I don't know 5% 8% 4% 4% 4% 4% 7% 5% 4% 4%

Highest value




Highest value




Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing rewards & recognition?


n = 249 n = 138 n = 81 n = 30 n = 383 n = 211 n = 145 n = 27

Excellent 10% 14% 6% 3% 3% 5% 1% 4%

Good 34% 36% 31% 33% 10% 11% 9% 11%

Average 37% 36% 41% 30% 34% 35% 33% 37%

Poor 12% 9% 16% 20% 28% 26% 34% 15%

Very poor 4% 3% 5% 10% 18% 18% 16% 30%

I don't know 3% 4% 1% 3% 6% 6% 6% 4%



Appendix I:Remuneration & benefits



Remuneration & benefits key challenges

37%

32%

25%

20%

12%

9%

11%

8%

7%

15%

8%

42%

35%

22%

20%

19%

10%

10%

10%

8%

9%

7%


Can't compete with external market rates

No structured management process

Lack of transparency

Lack of flexibility

Process is too complicated

Remuneration budget is frequently under

Process is too lengthy

Remuneration budget is frequently over


I don't know

What are your organisation's key remuneration challenges?

2020 (n = 602)

2020 (n = 510)



Summary:

The results of this survey indicate that key remuneration challenges are the misalignment between pay and performance, an inability to compete with external market rates, and the lack of a structured management process. In addition, the uncertainty caused by COVID-19 has created a shift in focus, where cost-cutting to weather the storm might be undermining long-term talent strategies and the aspirational goals associated with important issues such as gender pay equality.

Since 2019, there has been a 5 percentage point decline in the number of respondents who said a misalignment between performance and remuneration is one of their key challenges. However, this remained a challenge for roughly 2 in 5 respondents in 2020. Misalignment between performance and pay becomes a more significant issue as an organisation increases in size: 1 in 3 SMBs said this was a key challenge in comparison to 1 in 2 enterprise organisations.

1 in 4 organisations also said they were challenged by the lack of a structured remuneration management process.

Insight:

Staff salaries and related costs are one of the biggest expenses for any business (as much as 80% in some sectors). While salary increases have slowed in recent years, wages in Australia have still grown in nominal terms (by up to 30% in the last 10 years) and that trend shows no sign of changing. The story is similar in New Zealand, where wage growth at the start of 2020 was at a ten-year high, increasing 2.6% in the year to the December 2019 quarter. This means that remuneration is a significant and escalating fixed cost that can impact an organisation’s profitability andits ability to be agile in changing circumstances.

There has always been a strong connection between performance and remuneration. However, the fact that it continues to be the most commonly reported remuneration challenge underlines how difficult it can be to implement. While pay alone is not enough to motivate high performers, getting it wrong sends a message that will confuse or even anger employees, thwarting other efforts to invest in people and culture.

A commitment to quality is one of the defining characteristics of highly engaged employees. Gallup research has found that employees who do not see the same level of commitment in their co-workers can develop feelings of resentment. These employees might believe they are carrying more of the workload or producing better outcomes than their colleagues and should be paid more as a result. The same research found that around half of employees felt they were not paid fairly in comparison to their peers. Whether this assessment is accurate or not, these feelings can impact the engagement levels of those employees an organisation is most eager to retain.

https://smallbusiness.chron.com/percent-business-budget-salary-14254.html

https://www.abc.net.au/news/2018-11-01/fact-check-have-wages-grown-steadily-over-the-past-decade/10447492

https://www.stats.govt.nz/news/wage-growth-remains-at-10-year-high

https://www.gallup.com/workplace/238085/state-american-workplace-report-2017.aspx



Action:

● Connecting pay and performance does not have to be complicated. In its simplest form, it is a matter of reviewing who is being rewarded in the organisation and assessing if they are the same people delivering the behaviours and results the organisation is seeking to encourage. Are the highest contributors attracting rewards that demonstrate their efforts are valued, or is the way the remuneration budget is being spent sending a message that their efforts are not appreciated?

● As a minimum, organisations should aim for a certain level of remuneration and benefit ’hygiene‘, which essentially means setting a fair level of remuneration and benefits and ensuring these are reviewed regularly. Employees need to be paid accurately and on time, but pay also needs to be viewed as fair. When remuneration and benefit hygiene is not well managed it can impact employee morale and engagement. The solution could be as simple as requiring a minimum performance standard to qualify for additional remuneration, various incremental salary increases based on performance, or pay variable incentives.

● The chosen remuneration approach will depend on each organisation’s circumstances. Employers need to be mindful of what message and influence their remuneration and reward structures have. Whether they are connected to performance, values, transparency, innovation or other drivers, organisations need to consider what message they send. Researching the most impactful remuneration and benefits strategy and exploring what other levers can be used to engage employees will ultimately help lift individual, team and organisational performance.

1 in 10 respondents said being under budget was

a challenge. This was more of a challenge than

being over budget.

1 in 3 respondents have no structured

remuneration management process in place


n = 602 76 135 204 187 528 74 343 215 44




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Can't compete with external market rates 32% 25% 31% 30% 36% 33% 23% 27% 39% 34%

Lack of flexibility 12% 11% 13% 12% 13% 13% 4% 9% 15% 23%

Lack of transparency 20% 18% 19% 25% 16% 19% 23% 15% 23% 36%


37% 33% 39% 39% 35% 37% 36% 33% 41% 48%

No structured management process 25% 24% 21% 28% 25% 26% 18% 26% 22% 27%

Process is too complicated 9% 16% 7% 5% 11% 9% 8% 7% 8% 23%

Process is too lengthy 8% 9% 10% 3% 12% 9% 5% 8% 8% 16%

Remuneration budget is frequently over 7% 5% 7% 7% 7% 7% 7% 6% 9% 0%

Remuneration budget is frequently under 11% 9% 13% 12% 9% 12% 7% 9% 12% 20%


I don't know 8% 20% 11% 3% 5% 8% 4% 8% 7% 5%

Highest value




Highest value






n = 268 n = 154 n = 94 n = 20 n = 334 n = 189 n = 121 n = 24

Can't compete with external market rates 32% 27% 44% 20% 31% 27% 35% 46%

Lack of flexibility 10% 10% 11% 15% 14% 8% 19% 29%

Lack of transparency 15% 14% 16% 20% 19% 17% 29% 50%

Misalignment between performance and remuneration 32% 30% 34% 35% 37% 35% 47% 58%

No structured management process 14% 15% 12% 15% 26% 35% 31% 38%

Process is too complicated 9% 8% 11% 15% 8% 7% 7% 29%

Process is too lengthy 7% 6% 6% 10% 7% 8% 9% 21%

Remuneration budget is frequently over 7% 6% 11% 0% 8% 6% 8% 0%

Remuneration budget is frequently under 11% 9% 14% 10% 10% 9% 11% 29%


I don't know 6% 6% 6% 5% 6% 10% 8% 4%

Which of the following stages best describes your organisation's current state of HR and payroll and technology for remuneration & benefits?


Measuring remuneration process effectiveness

34%

21%

22%

20%

22%

4%

35%

8%

35%

28%

26%

23%

21%

5%

33%

7%

Market index (comparison with competitors)

Pay equity

Remuneration reviews completed within budget

Employee satisfaction with remuneration

Average annual base-pay increases

Time taken to conduct pay reviews


I don't know

Which metric(s) does your organisation use to measure the effectiveness of its remuneration processes?

2020 (n = 602)

2019 (n = 507)



Summary:

The results show that 1 in 3 organisations do not use any metrics to measure the effectiveness of their remuneration processes. This is a slight increase from the 2019 survey. Even more surprising is that 42% of C-suite leaders were unaware of any metric being used to assess how effectively remuneration is being managed within their organisation.

Insight:

While salaries are a significant component of the cost of doing business, there are opportunities for organisations of all sizes to reduce waste and ensure that they maximise the return on investment for every dollar spent. Knowing and tracking key remuneration metrics is a key way to do this. Data has never been more important to making informed business decisions and remuneration metrics help tell a large part of the people story. They should be included in any HR reporting suite.

Action:

● Identify the metrics that can most effectively assess your remuneration process. The use of metrics can help identify hot spots and key talent where retention and engagement initiatives are critical (e.g. ‘flight risk’ employees). This enables leaders to present business cases to do something to mitigate identified risks, rather than taking a blanket “do nothing” approach for all staff. ELMO recently released a whitepaper that explains a range of key remuneration metrics and how they can be used and calculated. Tracking these regularly can help HR leaders spot opportunities, unlock savings and prevent smaller issues escalating to larger issues.

1 in 5 respondents use pay equity as a metric

1 in 5 enterprise organisations measure 'pay

equity' and 'remuneration reviews completed

within budget'. These are their top metrics used

https://elmosoftware.com.au/resources/ebooks-guides/12-remuneration-metrics-to-track/


n = 602 76 135 204 187 528 74 343 215 44




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Remuneration reviews completed within budget

22% 18% 24% 23% 21% 23% 18% 19% 27% 23%

Pay equity 21% 17% 19% 24% 21% 21% 22% 19% 25% 20%

Time taken to conduct pay reviews 4% 4% 3% 6% 3% 5% 0% 4% 5% 5%

Employee satisfaction with remuneration 20% 13% 19% 22% 22% 18% 32% 22% 19% 14%

Market index (comparison with competitors) 34% 36% 33% 36% 32% 33% 45% 30% 39% 41%

Average annual base-pay increases 22% 21% 21% 22% 24% 23% 20% 18% 28% 25%


I don't know 8% 22% 16% 3% 3% 9% 3% 8% 8% 11%

Highest value




Highest value






n = 267 n = 153 n = 94 n = 20 n = 332 n = 188 n = 120 n = 24

Remuneration reviews completed within budget 26% 21% 35% 15% 20% 17% 20% 29%

Pay equity 22% 17% 32% 20% 19% 21% 19% 21%

Time taken to conduct pay reviews 6% 5% 6% 5% 4% 2% 4% 4%

Employee satisfaction with remuneration 26% 30% 22% 15% 15% 15% 16% 13%

Market index (comparison with competitors) 34% 28% 44% 35% 33% 32% 35% 46%

Average annual base-pay increases 25% 23% 30% 25% 19% 15% 26% 25%


I don't know 7% 5% 7% 20% 9% 11% 9% 4%



Remuneration & benefits focus areas

29%

27%

8%

15%

7%

2%

7%

27%

12%

33%

32%

8%

18%

9%

1%

6%

25%

10%

Improving retention

Attracting in-demand skills

Minimising wages

Improving gender pay equality

More opportunity / equality for minority groups

Reducing CEO-to-worker pay ratio

Other

None - we're not looking to focus on remuneration

I don't know

Which of the following areas of remuneration is your organisation planning to focus on over the next 12

months?

2020 (n = 602)

2019 (n = 507)



Summary:

While mainstays such as improving retention and attracting in-demand skills remained the key focus areas, a key result in 2020 was the decline in the percentage of organisations focused on improving gender pay equality and / or measuring pay equality metrics. This was particularly apparent for mid-market respondents who are less focused on pay equality or using pay equality metrics than they were in 2019. Overall, only 1 in 7 respondents said their organisation is focused on gender pay equality and even less are focused on improving equality for minority groups.

Insight:

Along with a general decline in most focus areas, the drop in priority for gender pay equality demonstrates how much COVID-19 has sent organisations into cost cutting mode, which sadly means that some of the values around pay equality are less of a focus or not on the radar at all.

While COVID-19 has impacted organisations in numerous ways, one consistent feature across sectors has been the disproportionate impact on female workers. Many cost and risk management measures that appear innocuous have in fact hit women’s roles hardest and have also widened the gender pay gap. Australia’s gender pay gap stands at 14% (August 2020). This has led to warnings from the Workplace Gender Equality Agency (WGEA) that Australia is at risk of letting pay equality regress by a decade. In New Zealand, the latest report from Stats NZ (June 2019) found the gender pay gap was 9.3%. It’s also worth noting that it’s extremely difficult to understand the impact that proposed cost cuts may have without proper metrics in place.

Pay equality is an important part of workplace gender equality, which is a priority across many organisations to deliver on their organisational values and their talent strategy. Research indicates that workplaces prioritising gender equality attract better talent, while gender diversity at the leadership level correlates to better financial results and long-term value.

Unfortunately, it seems that when budgets tighten, employers tend to see every dollar spent on salaries and wages as a cost, rather than an investment to support their long-term retention and talent strategies. Organisations that lose sight of pay equality now will be vulnerable to talent and compliance risks that could take years to unravel and compromise their ability to participate in the post-pandemic recovery.

Action:

● Use key HR metrics to understand the link between remuneration and employee engagement and retention. Although fair remuneration is not the only reason people show up to work, it is always going to be an important element.

● Review remuneration practices across the organisation to ensure there are no gender-related pay disparities. If disparities do exist, develop a long-term strategy to systemically close those gaps.

https://www.wgea.gov.au/data/fact-sheets/australias-gender-pay-gap-statistics-2020

https://www.abc.net.au/news/2020-08-28/coronavirus-pandemic-impacting-gender-pay-gap-experts-warn/12604542

https://www.stats.govt.nz/news/gender-pay-gap-unchanged-since-2017

https://www.forbes.com/sites/forbesnonprofitcouncil/2020/03/27/why-gender-equality-matters-in-business-success/#45d10d6669c4


n = 601 76 135 203 187 527 74 343 214 44

Which of the following areas of remuneration is your organisation planning to focus on over the next 12 months?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Improving retention 29% 30% 24% 32% 29% 29% 30% 24% 35% 39%

Attracting in-demand skills 27% 17% 28% 24% 34% 27% 30% 26% 28% 32%

Minimising wages 8% 4% 4% 10% 12% 9% 4% 7% 10% 11%

Improving gender pay equality 15% 16% 19% 15% 12% 16% 14% 9% 21% 34%

More opportunity / equality for minority groups 7% 13% 8% 6% 5% 7% 5% 5% 8% 16%

Reducing CEO-to-worker pay ratio 2% 3% 0% 1% 5% 2% 3% 3% 1% 2%

None - we're not looking to focus on remuneration

27% 18% 22% 29% 33% 27% 31% 33% 22% 11%

I don't know 12% 25% 21% 8% 4% 13% 3% 10% 14% 18%

Highest value




n = 599

6%

31%

41%

12%

6%

5%

Excellent

Good

Average

Poor

Very poor

I don't know


managing remuneration / compensation & benefits?




Summary:

Less than 40% of respondents rated the effectiveness and efficiency of their remuneration processes as good or excellent. That means more than half of respondents feel there is a lot of room for improvement, which in remuneration terms means that time or money is being wasted.

Insight:

Managing remuneration is an inescapable part of having employees. Reviewing remuneration frameworks and processes may not have been a top priority in 2020, but it is the foundation of employment relationships. Being able to deliver key remuneration processes efficiently and effectively can save time and money, and free up HR teams to focus on more pressing people issues.

Despite the uncertainty that the outbreak of COVID-19 and the ensuing economic downturn introduced to the business world in 2020, there is still a clear focus on talent and supporting talent strategies through solid remuneration practices. Therefore, organisations that focused on cost-cutting without considering the impact on engagement, morale and reputation may eventually realise they were being short-sighted. Unemployment may have risen throughout 2020, but high performers are always in demand, and highly capable and engaged staff have a huge impact on an organisation’s bottom line.

It is also apparent that having a remuneration and benefits framework is critical to sustainable success in this area. While larger organisations are more likely to have a remuneration andbenefits specialist capable of creating such a framework, smaller organisations tend to have two ‘types’ of people responsible for their remuneration process. The first ‘type’ is savvy withnumbers and potentially crunches the numbers manually to ensure the technology is giving them the same result. The second ‘type’ of person relies on the technology and does not know how tocalculate the numbers, or how to interpret the meaning behind the numbers to spot anomalies or opportunities. This is where partnering with a remuneration and benefits technology specialistcan help smaller organisations to analyse their data and draw more meaningful insights from it.

Action:

● Consider how technology can help with your remuneration processes. The use of technology significantly increases the chance of respondents rating their organisation’s remunerationprocesses favourably. Overall, 1 in 2 respondents using a form of technology rated their effectiveness as good or excellent, compared with only 3 in 10 who do not use technology. Theratio is consistent for all organisation sizes.

● Ensure that you spend time evaluating and designing your framework to ensure it is tailored to your organisation’s needs and business goals. Technology is not the sole answer. Similarto other topics covered in this report, one cannot lay a technology platform over a poor framework and expect it to become effective.


n = 599 76 135 202 186 526 73 341 214 44

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing remuneration / compensation & benefits?



Senior management

C-suite leaders

Australia New Zealand SMB Mid-market Enterprise

Excellent 6% 3% 2% 4% 11% 6% 7% 7% 5% 0%

Good 31% 30% 30% 30% 32% 31% 30% 32% 30% 23%

Average 41% 25% 45% 45% 39% 40% 44% 41% 40% 43%

Poor 12% 13% 11% 13% 11% 12% 11% 11% 14% 14%

Very poor 6% 11% 4% 6% 4% 6% 4% 4% 6% 16%

I don't know 5% 18% 7% 1% 3% 5% 4% 5% 5% 5%

Highest value




Highest value




Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing remuneration / compensation & benefits?


n = 267 n = 153 n = 94 n = 20 n = 332 n = 188 n = 120 n = 24

Excellent 9% 10% 9% 0% 3% 5% 2% 0%

Good 40% 40% 38% 45% 27% 26% 24% 4%

Average 39% 39% 38% 45% 38% 42% 41% 42%

Poor 7% 7% 9% 10% 14% 14% 18% 17%

Very poor 1% 1% 2% 0% 6% 7% 9% 29%

I don't know 4% 4% 4% 0% 6% 6% 6% 8%



Appendix J:Payroll



Payroll key challenges

42%

32%

27%

22%

20%

20%

19%

18%

17%

16%

15%

13%

9%

7%

7%

7%

7%

7%

6%

5%

N/A

35%

32%

N/A

N/A

N/A

23%

N/A

N/A

33%

N/A

14%

N/A

N/A

9%

8%

9%

9%

8%

6%

Accurate reporting

Compliance breaches

Ensuring employee confidentiality

General payroll and legislative knowledge by myself or the team

Geographic differences (e.g. culture, language, legislation)

Inaccuracy of data supplied to or input into payroll system

Interpretation of Awards / Enterprise Agreements

Keeping up to date and understanding legislative changes affecting our…

Lack of flexible reporting tools

Lack of training

Manual processes and workarounds

Meeting deadlines

Not having self-service tools for employees and managers to use (i.e. a…

Number and frequency of ad hoc payments outside regular pay run

Overpayment of staff

Poor or no integration between employee systems across HR vs.…

Staff not utilising self-service when available

Underpayment of staff


I don't know

What are your organisation's key payroll challenges?

2020 (n = 430)

2019 (n = 360)


Highest value




What are your organisation's key payroll challenges? Total resp. SMB Mid-market Enterprise Total resp. SMB Mid-market Enterprise

n = 350 n = 212 n = 121 n = 17 n = 80 n = 42 n = 29 n = 9

Accurate reporting 15% 14% 14% 24% 23% 19% 28% 22%Compliance breaches 5% 4% 7% 6% 14% 2% 24% 33%Ensuring employee confidentiality 6% 8% 3% 0% 3% 0% 7% 0%

General payroll and legislative knowledge by myself or the team 17% 19% 13% 18% 20% 26% 17% 0%

Geographic differences (e.g. culture, language, legislation) 6% 5% 8% 6% 11% 12% 10% 11%Inaccuracy of data supplied to or input into payroll system 17% 16% 17% 41% 28% 14% 41% 44%Interpretation of Awards / Enterprise Agreements 24% 21% 29% 29% 40% 31% 52% 44%

Keeping up to date and understanding legislative changes affecting our business 20% 20% 21% 12% 23% 21% 31% 0%

Lack of flexible reporting tools 18% 15% 22% 29% 28% 21% 38% 22%Lack of training 5% 5% 7% 6% 16% 19% 7% 33%Manual processes and workarounds 40% 38% 42% 53% 50% 36% 66% 67%Meeting deadlines 8% 7% 9% 6% 15% 12% 17% 22%Not having self-service tools for employees and managers to use (i.e. a lot of paper and emails)

20% 17% 22% 47% 30% 26% 41% 11%

Number and frequency of ad hoc payments outside regular pay run 15% 11% 20% 29% 18% 7% 24% 44%

Overpayment of staff 6% 3% 7% 29% 11% 2% 21% 22%Poor or no integration between employee systems across HR vs. rostering / time & attendance, and / or payroll systems

29% 27% 31% 35% 44% 33% 55% 56%

Staff not utilising self-service when available 17% 12% 24% 24% 21% 10% 31% 44%Underpayment of staff 6% 3% 7% 35% 8% 0% 10% 33%None - we have no challenges 13% 15% 11% 12% 11% 19% 3% 0%I don't know 6% 7% 7% 0% 4% 2% 3% 11%

Which of the following stages best describes your organisation's current state of HR and payroll technology for payroll?



Summary:

‘Manual processes and workarounds’ was, by some margin, the biggest payroll challenge facing organisations in 2020. For those organisations without fully implemented technology, this was selected by a significant 67% of respondents (reducing to 53% for those respondents with fully implemented technology). The second biggest challenge suggests that technology cannot resolve all issues: poor integrations across HR, payroll and rostering / time & attendance systems (cited by 32% of all respondents). Surprisingly, this remains a challenge even for organisations with fully implemented technology, with 29% of total respondents citing this.

Interpretation of Awards / Enterprise Agreements (27%) was cited as the third most significant challenge – perhaps not surprising, given the complexity of the payroll environment in Australia and New Zealand. Fortunately, technology appears to be assisting with this challenge. Only 24% of respondents with fully implemented technology cited this as a challenge, versus 40% of those without technology.

Insight:

Existing and long-standing payroll challenges were compounded in 2020 by fresh challenges relating to COVID-19. Indeed, few areas of business operations were impacted more heavily than the payroll function. Many respondents listed their payroll challenges as being related to the burden of administration and keeping up with legislative changes. The introduction of government wage subsidy programs, such as JobKeeper in Australia, presented new challenges to payroll professionals – a situation not helped by the fact that many payroll software vendors were unable to deliver automation to their customers due to short lead times. Identifying eligible employees, collecting declarations and calculating top-ups were all added to the workload of payroll professionals in 2020.

It’s clear there are still many organisations using manual processes and workarounds – and again, the government wage subsidies meant that additional work was required as part of these manual processes. It was estimated that determining who needed a top-up and by how much added on average around 20 extra hours per pay run. It is to the payroll profession’s credit that compliance breaches, as well as underpayments and overpayments, were rated quite low on the list of challenges.

In 2020, there was also a decline in Award and Enterprise Agreement interpretation being cited as a challenge. This is no doubt due to the adoption of automated interpretation through smart HR technology. However, there was also a lack of integration occurring between HR, rostering / time & attendance systems, and payroll systems. This was cited by 32% of respondents as a challenge, and appears to have been more of a challenge for larger organisations, having been cited by 42% of enterprise respondents and 35% of mid-market (and 28% of SMBs). This challenge may have rated so highly due to the laborious nature of dealing with exceptions, or perhaps because organisations are still transposing data manually.



Unfortunately, it seems many organisations are not helping their payroll team to deal with admin by minimising payroll inaccuracies: a common expectation is that payroll will simply ‘fix things’. More than that, there may be an expectation from payroll professionals that their payroll software will keep them out of trouble. However, this is dangerous. More experienced payroll professionals are aware of their compliance obligations and stay on top of changing legislation. Continuous professional development is a must for payroll professionals.

There is a new incentive for staying on top of compliance issues. In Australia, the states of Queensland and Victoria have introduced legislation that makes wage theft a criminal offence, with business owners bearing the brunt. There is pressure mounting to make this a federal offence, whereby owners will be charged under criminal proceedings and face more than just fines if they are found guilty of wage theft. While there is no recent New Zealand data regarding wage theft, in 2016 the Council of Trade Unions found workers had been repaid more than $35 million for payroll errors that year alone. There have been countless instances of employers underpaying employees in recent years. Here are some tips from the Australian Payroll Association on how to avoid becoming yet another headline.

Action:

● Don’t be complacent. Complexity is no excuse for underpayment of entitlements. The onus is on employers to keep track of – and correctly apply – all the rules.● Regularly conduct compliance checks. Compliance checks for payroll are necessary to ensure the processes and tools used are still compliant and fit for purpose. An annual audit of the

payroll platform may prevent small issues becoming bigger (and more costly) issues.● Payroll data accuracy should always be a priority. The more accurate the payroll function is, the better most business processes will be. Just as critically, the adoption rate of self-service

tools will increase, and that in turn will translate into accuracy and savings in payroll.● Be wary of manual workarounds. Manual workarounds have always been a challenge for payroll. However, the events of 2020 – especially implementing government wage subsidies –

exacerbated this challenge. Payroll professionals don’t need to be calculating pay manually; however, if something needs to be changed, and it’s happening for the first time, they do need to know that the change is implemented correctly. This is where over-reliance on technology can be risky. Today’s payroll professionals must be aware of what’s changing and who it impacts. Continuous professional development and always being alert to changing legislation and regulations is a better response than relying solely on a system to dictate what is compliant.

● When it comes to implementing new technology, consider the change process that may be required to ensure any tools are being utilised correctly. This may apply to the payroll team as much as the employees themselves. For example, self-service functionality will only make a difference if appropriate training is offered and processes are changed accordingly. It’s all too easy to implement new technology only to revert to previous processes. Also, ensure that any tools used serve the right purpose: Does it help resolve the challenges at play? Can it be used on any device?

https://www.oir.qld.gov.au/industrial-relations/wage-theft

https://www.theage.com.au/politics/victoria/wage-theft-to-become-a-crime-as-victoria-s-parliament-passes-new-laws-20200617-p553ba.html

https://www.stuff.co.nz/business/opinion-analysis/114853237/wage-theft-has-become-a-business-model-in-the-hospitality-industry

https://austpayroll.com.au/underpayments-dont-become-a-headline/


n = 430 46 94 148 142 385 45 254 150 26

What are your organisation's key payroll challenges? OverallJunior to mid-level


Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Accurate reporting 16% 13% 22% 11% 18% 16% 16% 15% 17% 23%

Compliance breaches 7% 9% 9% 7% 4% 7% 4% 4% 10% 15%

Ensuring employee confidentiality 5% 2% 6% 5% 5% 5% 9% 6% 4% 0%

General payroll and legislative knowledge by myself or the team

17% 13% 15% 17% 21% 18% 9% 20% 14% 12%

Geographic differences (e.g. culture, language, legislation) 7% 11% 10% 4% 8% 7% 11% 6% 9% 8%

Inaccuracy of data supplied to or input into payroll system

19% 15% 22% 19% 19% 19% 22% 15% 22% 42%

Interpretation of Awards / Enterprise Agreements 27% 33% 36% 20% 27% 29% 7% 22% 33% 35%

Keeping up to date and understanding legislative changes affecting our business

20% 17% 17% 21% 23% 21% 16% 20% 23% 8%

Lack of flexible reporting tools 20% 26% 24% 20% 15% 21% 16% 16% 25% 27%

Lack of training 7% 9% 9% 6% 8% 7% 11% 7% 7% 15%

Highest value


Payroll key challenges – Part 1


n = 430 46 94 148 142 385 45 254 150 26

What are your organisation's key payroll challenges? OverallJunior to mid-level


Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Manual processes and workarounds 42% 37% 52% 41% 38% 43% 31% 37% 47% 58%

Meeting deadlines 9% 9% 14% 7% 8% 10% 4% 8% 11% 12%

Not having self-service tools for employees and managers to use (i.e. a lot of paper and emails)

22% 26% 21% 22% 20% 22% 20% 18% 26% 35%

Number and frequency of ad hoc payments outside regular pay run

15% 17% 16% 12% 18% 16% 11% 10% 21% 35%

Overpayment of staff 7% 4% 14% 5% 4% 8% 0% 3% 10% 27%

Poor or no integration between employee systems across HR vs. rostering / time & attendance, and / or payroll systems

32% 28% 26% 37% 31% 32% 24% 28% 35% 42%

Staff not utilising self-service when available 18% 37% 14% 18% 14% 17% 24% 12% 25% 31%

Underpayment of staff 7% 7% 9% 7% 5% 7% 2% 3% 8% 35%


I don't know 6% 11% 9% 3% 5% 6% 7% 6% 6% 4%

Highest value


Payroll key challenges – Part 2


Measuring payroll process effectiveness

42%

26%

24%

24%

16%

14%

14%

11%

10%

6%

3%

10%

39%

N/A

26%

N/A

#N/A

#N/A

N/A

11%

14%

13%

#N/A

13%


Pay cycle accuracy

Compliance

Payment timeliness

Reporting accuracy

Reporting timeliness

Number of employee enquiries

Total payroll processing costs

Cycle time to process payroll

Cycle time to resolve payroll errors

Payroll processing costs by payslip

I don't know

Which metric(s) does your organisation use to measure the performance of its payroll processes?

2020 (n = 426)

2019 (n = 356)



Summary:

Once again, not many organisations are using any metrics at all to measure payroll effectiveness – although SMBs appear to be struggling the most in this regard. Having no metrics at all correlates with technology usage, or lack thereof. Those with technology tend to utilise metrics; those without fully implemented technology go without metrics or only have access to basic metrics. For SMBs with fully implemented technology, 47% said they used no metrics at all; for those without fully implemented technology this increased to 55%. For enterprise organisations, these figures were 33% for those without technology and 18% for those with technology. For mid-market organisations, the figures were 38% for those without technology and 33% with technology. While the use of all metrics declined compared to 2019, the preference order (i.e. the types of metrics used) remained the same. Similar to 2019, the main metrics used in 2020 related to compliance and payroll accuracy.

Insight:

Enterprise teams mainly focused on accuracy and the number of employee enquiries to assess their payroll performance. It makes sense for enterprise businesses to focus on these areas as payroll generally exists as a standalone function (tied to Finance) and therefore payroll operations have more internal visibility. Payroll teams need to prove or show value against their costs as they’re not revenue generating. Enterprise organisations also typically have larger payroll teams, but this does not necessarily correlate to improved data accuracy. Indeed, research from the Australian Payroll Associationshows that 69% of organisations with more than 10,000 employees made errors at least every month, compared with 55% of organisations with 1001-5000 employees, 45% of organisations with 500-1000 employees, 24% of those with 201-500 employees, 21% of those with 51-200 employees, and just 16% of businesses with up to 50 employees.

Further insights can be drawn from the responses to this question about payroll metrics. One is that some payroll professionals may not know how to measure the success of their operations. This could bedue to the high staff turnover in the profession, and employee burnout, which is a genuine and concerning issue. New hires may be unaware of or untrained on what needs to be assessed or where to findrelevant data. The survey results also highlight an underlying reluctance to change. For a payroll professional to give up a previous system and adopt a new one whilst carrying on their day-to-day activities isa big ask. It also takes time to find all the relevant data and information required in a new system. Although payroll professionals are clearly passionate about accuracy and getting the job done as efficientlyas possible, some would rather stick with an inefficient process than switch to a newer, more efficient process or platform and risk getting it wrong.

Beyond pay cycle accuracy (cited as a metric used by 26% of respondents overall), compliance remains a key indicator of payroll effectiveness (cited by 24% of respondents overall). This may be due to the complexity and changing regulatory nature of Australia and New Zealand’s industrial landscape. According to research, 90% of payroll managers find the current laws confusing and contradictory. That research also highlighted that 89% of payroll managers struggle to apply laws to real-world situations, due to uncertainty about how to interpret the wording of Awards and associated legislation.

Action:

● Ensure payroll employees have appropriate training and support to keep up with regulatory and legislative changes. Research shows that only 10% of payroll professionals in Australia across large and small organisations have a competency-based payroll qualification. Without the right training and support, payroll accuracy cannot be guaranteed and compliance issues will continue.

● Fully utilise the reporting capabilities of any payroll software in place. If software is not yet implemented, undertake market research to identify which system can best serve the needs of your organisation.

https://austpayroll.com.au/how-can-employers-minimise-the-incidence-of-payroll-errors/

https://www.smartcompany.com.au/finance/payroll-managers-confused/

https://www.smartcompany.com.au/finance/payroll-managers-confused/


n = 426 46 93 146 141 381 45 251 149 26




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Compliance 24% 24% 19% 31% 20% 25% 11% 20% 30% 27%

Cycle time to process payroll 10% 9% 9% 12% 9% 10% 7% 11% 8% 12%

Cycle time to resolve payroll errors 6% 7% 5% 5% 7% 6% 2% 4% 7% 19%

Number of employee enquiries 14% 13% 13% 15% 13% 14% 9% 11% 15% 31%

Pay cycle accuracy 26% 30% 20% 32% 21% 27% 20% 22% 32% 31%

Payment timeliness 24% 20% 19% 27% 26% 24% 22% 21% 29% 23%

Payroll processing costs by payslip 3% 2% 4% 3% 4% 3% 4% 3% 3% 8%

Reporting accuracy 16% 17% 16% 19% 13% 17% 9% 14% 19% 23%

Reporting timeliness 14% 11% 13% 18% 12% 15% 7% 12% 17% 19%

Total payroll processing costs 11% 11% 6% 13% 11% 11% 11% 8% 11% 27%


I don't know 10% 24% 19% 5% 5% 11% 9% 8% 13% 15%

Highest value




Highest value






n = 346 n = 209 n = 120 n = 17 n = 80 n = 42 n = 29 n = 9

Compliance 24% 20% 31% 24% 24% 21% 24% 33%

Cycle time to process payroll 10% 11% 8% 6% 11% 12% 7% 22%

Cycle time to resolve payroll errors 6% 3% 8% 24% 6% 5% 7% 11%

Number of employee enquiries 15% 12% 17% 41% 8% 5% 10% 11%

Pay cycle accuracy 27% 23% 33% 41% 19% 14% 28% 11%

Payment timeliness 25% 22% 31% 18% 21% 19% 21% 33%

Payroll processing costs by payslip 3% 2% 3% 12% 4% 7% 0% 0%

Reporting accuracy 17% 14% 22% 12% 14% 12% 7% 44%

Reporting timeliness 13% 12% 15% 12% 19% 12% 24% 33%

Total payroll processing costs 11% 9% 12% 24% 10% 5% 10% 33%


I don't know 10% 8% 13% 18% 13% 10% 17% 11%



Tools to manage payroll processes

23%

28%

7%

26%

52%

5%

3%

21%

36%

6%

22%

45%

8%

3%

Accounting software

Integrated HR and payroll software

Paper-based methods (e.g. 'box of receipts')

Spreadsheets

Stand-alone payroll software

Other

I don't know

How do you currently manage your organisation's payroll processes?

2020 (n = 425)

2019 (n = 356)



Summary:

Stand-alone payroll software remains the most popular way to manage payroll processes, selected by 52% of respondents overall. Integrated HR and payroll software was the second most popular choice, having been selected by 28% of respondents. When responses to this question are analysed by organisation size, stand-alone payroll software is used by 58% of mid-market organisations, 50% of SMBs, and 38% of enterprise organisations. More enterprise organisations (58%) selected integrated HR and payroll software. This dropped to 32% for mid-market organisations, and 22% for SMBs.

Manual processes are still prevalent, with 26% of organisations using spreadsheets and 7% using paper-based methods. Not surprisingly, SMBs are the highest users of accounting software, with 30% of respondents selecting this option.

Insight:

The prevalence of integrated platforms for enterprise organisations is expected, given the time, cost and resource savings possible by having all-in-one HR and payroll systems. For mid-market organisations, the results were also not surprising. Their preference for stand-alone software is possibly due to not being quite ready – or large enough – to justify having a broader technological ecosystem, so stand-alone software is purchased as and when it’s required. It’s also challenging to adopt new software or platforms. This can lead to payroll professionals sticking with what they know and even encouraging or influencing their new employer(s) to take up the systems they are comfortable with.

In Australia, the introduction of Single Touch Payroll (STP) reporting in 2019 required many organisations to update their payroll systems. For those organisations still using their accountant to complete payroll, they will need to move to a means of completing their own payroll and reporting obligations unless they are using a registered agent / intermediary. The introduction of government wage subsidies during the pandemic also accelerated this trend towards having some form of technology to stay on top of payroll obligations.

The use of spreadsheets remains widespread, with just over a quarter (26%) of all respondents using them. However, this usage may be due to some organisations not yet having fully implemented technology to match existing processes, resulting in functional gaps that need filling. Alternatively, this may be due to experienced payroll professionals running additional checks and validating numbers using spreadsheets.

Action:

● Assess how technology can be utilised to streamline payroll operations.● Consult your current system’s Customer Success Manager to assist in the choice of any “add-on” platforms to ensure they integrate with the end result in mind.


n = 425 46 93 145 141 380 45 250 149 26




Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Accounting software 23% 15% 20% 23% 27% 25% 9% 30% 16% 0%

Integrated HR and payroll software 28% 33% 43% 26% 18% 29% 16% 22% 32% 58%

Paper-based methods (e.g. 'box of receipts') 7% 4% 6% 5% 9% 7% 4% 5% 8% 12%

Spreadsheets 26% 30% 34% 21% 23% 26% 22% 25% 28% 15%

Stand-alone payroll software 52% 59% 45% 57% 48% 51% 62% 50% 58% 38%

I don't know 3% 4% 3% 1% 4% 3% 2% 4% 2% 0%

Highest value




Highest value






n = 345 n = 208 n = 120 n = 17 n = 80 n = 42 n = 29 n = 9

Accounting software 21% 27% 13% 0% 31% 40% 28% 0%

Integrated HR and payroll software 30% 25% 32% 76% 20% 12% 31% 22%

Paper-based methods (e.g. 'box of receipts') 6% 5% 7% 6% 10% 5% 14% 22%

Spreadsheets 25% 25% 26% 12% 30% 26% 38% 22%

Stand-alone payroll software 52% 51% 59% 18% 50% 43% 52% 78%

I don't know 3% 3% 2% 0% 4% 5% 3% 0%



Types of pay cycles

26%

66%

4%#N/A

36%

1%

8%

1%3%

28%

61%

5%1%

35%

1%

12%

1% 2%

Weekly Fortnightly

(biweekly)

Bimonthly (two

cycles per

month)

Every four

weeks

Monthly Quarterly Ad hoc Other I don't know

Across your entire organisation, which of the following pay cycles are run?

2019 (n = 356)

2020 (n = 426)


Types of pay cycles

Summary:

2020 results were similar to those from 2019. Fortnightly (bi-weekly) is by some margin the most popular pay cycle, cited by 61% of respondents, followed by monthly (35%) and weekly (28%). Technology may play a role in pay cycles. For example, 83% of respondents with fully implemented technology use weekly cycles, versus 71% of those without fully implemented technology.

Insight:

The payroll process should be as easy and effective as possible. The most common payroll schedules in Australia are weekly, fortnightly and monthly. Ad hoc pay cycles would normally only be applicable for corrections or terminations, which need to be paid within 7 days and are frequently paid out of cycle. In New Zealand, the most common are fortnightly, monthly and weekly.

Every business has the freedom to choose its own payroll schedule, although in some instances this may be dictated by Awards or collective bargaining agreements. In Australia, collective agreements (EBAs) cover almost 40% of employees, about 22% are solely Award-reliant, and the remainder have individual contracts underwritten by the legislated National Employment Standards (NES). In New Zealand, approximately 21% of workers are on collective agreements.

Action:

If circumstances allow for a pay schedule to be chosen, consider the following questions:

● How many employees do you have?● Does your Award specify a pay period?● Do you pay your employees an hourly rate or a salary?● Do you pay your employees for overtime?● How much does it cost you to process the payroll?

6 in 10 respondents use fortnightly

(biweekly) pay cycles

Over 1 in 3 respondents

use monthly pay cycles

https://www.hrmonline.com.au/industrial-relations/fresh-look-modern-awards-industrial/

http://economicsnz.blogspot.com/2016/09/unions-and-collective-agreements.html


n = 426 46 93 146 141 381 45 251 149 26




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Weekly 28% 26% 20% 32% 31% 28% 31% 26% 31% 42%

Fortnightly (biweekly) 61% 63% 68% 58% 58% 61% 62% 53% 70% 77%

Bimonthly (two cycles per month) 5% 13% 3% 3% 5% 4% 9% 5% 5% 0%

Every four weeks 1% 2% 2% 0% 2% 2% 0% 1% 1% 4%

Monthly 35% 43% 31% 36% 34% 35% 36% 35% 33% 50%

Quarterly 1% 2% 1% 1% 1% 1% 0% 1% 2% 0%

Ad hoc 12% 15% 16% 14% 6% 12% 18% 10% 15% 19%

I don't know 2% 2% 4% 0% 3% 2% 2% 3% 1% 4%

Highest value


Types of pay cycles


Highest value


Types of pay cycles




n = 345 n = 208 n = 120 n = 17 n = 80 n = 42 n = 29 n = 9

Weekly 83% 78% 88% 94% 71% 60% 86% 78%

Fortnightly (biweekly) 61% 56% 68% 76% 59% 40% 79% 78%

Bimonthly (two cycles per month) 4% 4% 5% 0% 8% 10% 7% 0%

Every four weeks 1% 1% 2% 6% 1% 2% 0% 0%

Monthly 38% 38% 37% 47% 38% 38% 31% 56%

Quarterly 1% 1% 3% 0% 0% 0% 0% 0%

Ad hoc 12% 9% 14% 29% 14% 12% 21% 0%

Other 0% 0% 1% 0% 3% 5% 0% 0%

I don't know 2% 2% 1% 0% 4% 5% 0% 11%



n = 425

14%

44%

30%

7%

4%

2%

Excellent

Good

Average

Poor

Very poor

I don't know


managing your organisation's payroll?




Summary:

Most organisations are satisfied with how their payroll processes and systems are tracking, with 58% of respondents rating themselves as ‘good’ or above. 41% rate their processes and systems as average or worse. No enterprise respondents rated their systems and processes as ‘excellent’; most rated them as ‘average’. There were expected industry variations as well: the manufacturing sector, wholesale trade sector, and administrative & support services sector were more likely to report that their payroll processes and systems were ‘poor’. Conversely, the accommodation and food services sector, along with the rental, hiring and real estate services sector obtained the most ‘excellent’ responses.

When it comes to payroll enquiries received per month (see graphs showing payroll enquiries later in this Payroll section), Australian payroll teams received double the amount than New Zealand teams reported (based on median figures). Enterprise organisations received five times the number of enquiries than mid-market organisations – a reflection of the complex nature of payroll in larger organisations, which may have more than 100 payroll-related obligations to various entities covering taxation, workplace rights and standards, employee benefits, superannuation, and workers’ compensation, to name just a few.

Insight:

Most enterprise respondents rated their systems and processes as ‘average’. This result should not come as a surprise – there are so many variables with payroll and leave and these variables increase as employee numbers rise. There may also be broader, more systemic issues at play. For example, enterprise processes may suffer due to a lack of payroll operational leadership. Payroll managers are typically ‘do-ers’ rather than leaders, and many career payroll professionals are retiring. This will leave a talent gap and a lack of skills relating to change management, strategic planning and also executive team liaison. Leaders need to be updated on what needs to be done to improve compliance and reduce risk.

For industries that have been burnt by employee underpayments or wage theft claims – and that’s most industries – one would expect that processes have been improved to prevent such mistakes occurring in the future. However, this will take time. For now, a significant 33% of payroll managers admit to making employee payment or entitlement blunders at least once a month – and that’s a financial and reputational risk that no organisation can afford.

Action:

For those organisations looking to improve their payroll operations, here are four questions to ask:

● When was the last time we checked that the way we pay people is correct?● When did we last seek advice to ensure that what we think are the correct rules are actually correct?● How are we resourcing compliance internally and have we struck the right balance between systems and people?● How regularly are we updating our HR information systems, rostering / time & attendance systems, and payroll systems, and are these systems still fit for purpose?● Is there sufficient training and support for payroll professionals in the organisation so they can keep abreast of the industrial relations landscape and understand how to apply new legislation and

regulations to the business?

https://austpayroll.com.au/how-can-employers-minimise-the-incidence-of-payroll-errors/


n = 425 46 93 145 141 380 45 250 149 26

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing your organisation's payroll?



Senior management

C-suite leaders


Excellent 14% 15% 11% 14% 16% 12% 27% 17% 11% 0%

Good 44% 39% 35% 47% 48% 44% 42% 50% 36% 31%

Average 30% 30% 37% 30% 24% 31% 22% 22% 39% 46%

Poor 7% 7% 4% 7% 9% 7% 4% 8% 5% 12%

Very poor 4% 4% 8% 1% 4% 4% 4% 2% 6% 8%

I don't know 2% 4% 5% 1% 0% 2% 0% 2% 3% 4%

Highest value




Highest value




Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing your organisation's payroll?


n = 345 n = 208 n = 120 n = 17 n = 132 n = 42 n = 29 n = 9

Excellent 16% 19% 14% 0% 2% 7% 0% 0%

Good 46% 50% 39% 47% 20% 45% 24% 0%

Average 28% 21% 38% 47% 21% 29% 41% 44%

Poor 5% 6% 3% 0% 9% 14% 10% 33%

Very poor 2% 2% 3% 6% 6% 2% 21% 11%

I don't know 2% 1% 3% 0% 2% 2% 3% 11%



Note: This question asked respondents to provide values relating to several aspects of the payroll process. The number of respondents listed for each column in the table above refers to the average number of people who provided an answer for these questions, as some respondents may not have answered all questions.

Average hours per month spent on payroll activities

Highestaverage

value


value

Average n = 161 20 41 52 48 146 17 115 40 6

How many hours per calendar month do you personally spend on the following key payroll activities?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Ad hoc or off-cycle payroll 4 4 5 3 2 4 2 3 7 2

Data validation 5 9 6 4 5 5 5 6 5 2

Distributing payments 5 3 6 9 2 5 11 4 8 1

Employee enquiries 5 6 7 4 3 5 3 4 7 7

Gathering required data input 7 10 7 6 7 7 13 7 8 6

Payroll accounting 5 4 7 7 3 4 12 5 7 2

Payroll calculation 6 12 8 5 4 7 4 6 8 2

Payroll policy administration 5 6 6 3 5 5 5 5 6 3

Reporting 5 5 7 4 3 5 4 4 7 11

Reviewing and approving all payroll payments 5 6 9 5 4 5 9 5 5 3

Staff training / coaching / development / management 5 4 6 7 4 6 3 4 7 18

Statutory compliance 3 3 5 3 3 4 2 2 6 4



Average n = 161 20 41 52 48 146 17 115 40 6

How many hours per calendar month do you personally spend on the following key payroll activities?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Ad hoc or off-cycle payroll 1 2 2 1 1 1 1 1 2 2

Data validation 2 4 2 2 2 2 2 2 4 2

Distributing payments 1 2 1 1 1 1 2 1 5 1

Employee enquiries 2 5 2 2 2 2 2 2 4 5

Gathering required data input 3 5 4 2 2 4 2 3 4 5

Payroll accounting 2 4 3 2 2 2 4 2 5 2

Payroll calculation 3 5 5 2 2 3 2 3 4 1

Payroll policy administration 2 3 2 2 2 2 2 2 3 2

Reporting 2 3 3 2 2 2 2 2 3 6

Reviewing and approving all payroll payments

2 4 3 2 2 2 2 2 3 2

Staff training / coaching / development / management

2 4 2 2 3 2 3 2 3 5

Statutory compliance 2 2 3 2 1 2 1 2 3 3

Highestmedian

value


value

Median hours per month spent on payroll activities


Median hours per month spent on payroll activities

Summary:

‘Gathering data’ was identified as the activity that payroll professionals spend the most time on in Australia, while in New Zealand most time goes towards payroll accounting. ‘Reporting’ was identified by enterprise respondents as taking the most time, while for SMBs it was ‘gathering data’ and ‘payroll calculation’.

Insight:

Australian payroll professionals devote most of their time to two tasks: ‘gathering data for payroll’; and ‘payroll calculations’. This is not surprising. Many payroll systems aren’t geared towards across-the-board self-service functionality and automation. Gathering data for payroll is an onerous process that not everyone has mastered through self-service functionality and online onboarding. Compiling transactional data such as timesheets, ensuring information is obtained from new starters, and changes in employment conditions all impact payroll. The time put into payroll calculations is likely due to complex termination calculations and the increase of those during COVID-19, not to mention the increased calculation workload that has come with government wage subsidy top-ups (for example, JobKeeper). New Zealand professionals face a similar burden, with respondents citing ‘gathering data for payroll’ and ‘payroll accounting’ as their highest time investments during the pay cycle. ‘Payroll accounting’ being rated so highly is interesting, as New Zealanders do not face anything more onerous than Australians when it comes to legislative requirements – in fact, Australia’s leave liability is far more complex than New Zealand’s. However, this result might reflect the smaller population, less coverage of collective agreements, and fewer options for localised and automated payroll technology.

Action:

● Undertake research into what can be automated. While payroll technology cannot fix a fundamentally complex regulatory environment and human oversight will always be required, it can streamline and automate processes and help with compliance obligations.

● Investigate how self-service functionality can help improve the efficiency of payroll operations. The table below highlights some examples of how self-service tools can help employees, managers and HR manage their payroll and rostering / time & attendance obligations:

For employees For managers / HR

Check leave and payslips online at any time Approve leave requests and review balances

Update bank and superannuation details online at any time Track absentee rates

Fill out and send timesheets easily online at any time; receive automated emails when rosters are updated Approve timesheets, rosters, and schedules; send automated roster update emails



Average hours taken to complete one pay cycle

Highestaverage

value


value

Average n = 56 8 13 31 18 49 11 39 18 6

How many hours of work does it take your organisation to complete one pay cycle run?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Weekly 11 17 17 10 8 12 4 6 20 25

Fortnightly (biweekly) 22 19 20 15 32 23 12 11 28 121

Every four weeks 4 2 2 - 6 4 - 3 8 -

Monthly 14 17 18 17 9 15 10 9 31 12

Bimonthly (2 cycles per month) 17 5 20 19 22 21 7 7 28 -

Quarterly 6 2 5 - 10 6 - 4 10 -

Ad hoc 6 7 5 2 14 6 2 3 11 3



Average n = 56 8 13 31 18 49 11 39 18 6

How many hours of work does it take your organisation to complete one pay cycle run?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Weekly 5 8 6 4 5 5 4 4 8 16

Fortnightly (biweekly) 10 10 11 10 10 10 8 8 20 40

Every four weeks 3 2 2 - 6 3 - 2 8 -

Bimonthly (2 cycles per month) 8 5 20 10 15 12 6 5 20 -

Monthly 8 16 8 8 6 8 6 7 13 12

Quarterly 5 2 5 - 10 5 - 4 10 -

Ad hoc 2 5 2 2 2 2 2 2 2 1

Highestmedian

value


value

Median hours taken to complete one pay cycle



Highestaverage

value


value

Average number of payroll enquiries received per month

Average n = 296 33 66 107 90 263 33 190 95 11

Payroll OverallJunior tomid-level


Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Considering all of your organisation’s pay cycles, how many payroll enquiries does your organisation receive per calendar month (e.g. reviewing payslip information, confirming bank details, employee reporting errors, etc.)?

61 36 40 63 82 47 172 13 53 953



Average n = 296 33 66 107 90 263 33 190 95 11

Payroll OverallJunior to mid-level


Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Considering all of your organisation's pay cycles, how many payroll enquiries does your organisation receive per calendar month (e.g. reviewing payslip information, confirming bank details, employee reporting errors, etc.)?

8 10 10 6 7 10 5 5 20 100

Highestmedian

value


value

Median number of payroll enquiries received per month


Appendix K:Rostering / time & attendance



Rostering / time & attendance key challenges

15%

18%

15%

21%

21%

14%

17%

15%

13%

35%

7%

22%

19%

15%

14%

12%

20%

8%

N/A

N/A

17%

28%

29%

N/A

N/A

N/A

N/A

40%

N/A

N/A

22%

N/A

17%

13%

15%

8%

Ability to monitor shift and roster costs

Communication to employees about rosters and changes

Compliance

Data input errors

Ineffective leave management

Ineffective reporting

Ineffective rostering

Keeping up to date with industrial awards, etc.

Lack of flexible reporting

Manual processes or workarounds

Monitoring certification eligibility to do particular shifts (e.g. licences, RSAs)


No real-time reporting

The effort to fill a roster

Too much absenteeism

Too much overtime


I don't know

What are your organisation's key rostering / time & attendance challenges?

2020 (n = 356)

2019 (n = 284)


Highest value


Rostering / time & attendance key challenges – part 2




n = 205 n = 129 n = 56 n = 20 n = 151 n = 84 n = 56 n = 11

Ability to monitor shift and roster costs 13% 10% 20% 15% 17% 7% 32% 18%

Communication to employees about rosters and changes 19% 17% 18% 35% 17% 7% 29% 27%

Compliance 13% 11% 16% 20% 19% 13% 25% 27%Data input errors 19% 18% 23% 15% 23% 14% 34% 36%Ineffective leave management 17% 19% 11% 25% 26% 17% 39% 27%Ineffective reporting 9% 5% 14% 20% 20% 8% 38% 18%Ineffective rostering 12% 8% 16% 25% 23% 12% 39% 27%Keeping up to date with industrial awards, etc. 17% 18% 14% 15% 13% 5% 25% 18%Lack of flexible reporting 11% 8% 18% 15% 15% 7% 25% 18%Manual processes or workarounds 29% 25% 36% 40% 42% 32% 55% 45%Monitoring certification eligibility to do particular shifts (e.g. licences, RSAs)

7% 6% 9% 5% 8% 4% 14% 9%


16% 13% 16% 30% 31% 23% 45% 27%

No real-time reporting 14% 12% 18% 15% 27% 14% 45% 36%The effort to fill a roster 13% 10% 13% 35% 19% 13% 25% 27%Too much absenteeism 16% 12% 13% 45% 12% 6% 20% 18%Too much overtime 11% 9% 14% 20% 14% 7% 25% 9%None - we have no challenges 19% 25% 11% 0% 22% 31% 11% 9%I don't know 9% 7% 11% 15% 6% 6% 4% 18%

Which of the following stages best describes your organisation's current state of HR and payroll and technology for rostering / time & attendance?



Summary:

Earlier in this report, the rising importance of workforce management (WFM) and rostering, time & attendance was noted. The market saw a 7% increase in the number of organisations considering investing in workforce planning as a high priority, while there was a 5% increase in those considering it a medium priority. Workforce planning enables employers to reduce costs from over-rostering and mitigate compliance issues of over- or under-paying Awards and entitlements.

Over half (55%) of mid-market organisations without fully implemented technology are using manual processes or workarounds. This drops to 36% for those mid-market organisations with fully implemented technology – an indication that although technology certainly helps, WFM processes still require some manual interventions. Indeed, ‘integration of employee systems across HR vs. rostering / time & attendance and / or payroll systems’ is the second biggest challenge facing organisations of all sizes in this space, cited by 22% of respondents. This rises to 45% for mid-market respondents. Some challenges, including ‘data input errors’ and ‘ineffective leave management’, were lower priorities in this year’s results. ‘Compliance’ also saw a slight drop – a surprise given the impact of COVID-19 on staff rostering and scheduling.

Insight:

There are some interesting observations to be made about the responses to this question based on organisation size. Management teams in SMBs are generally familiar with employees: they know them personally and know when they are scheduled to work. Mid-market and enterprise organisations don’t have that luxury – but then again, it would be more common to scale staffing needs before scaling the workforce planning platform / software. This hands-on approach is reflected in ‘ineffective rostering’ only being cited by 8% of SMBs. However, there’s an element of not knowing what you don’t know. Many SMBs don’t have data to support a rostering decision either way – and when dollars are being watched every day, it’s important to have data to back decisions.

Data is critical for successful rostering and some organisations will feed previous sales figures into WFM tools to determine staffing needs. For organisations that have relied upon the previous year’s data, the danger is always having too many or too few people on the ground – this is magnified by the unusual business and economic conditions seen during the second half of 2020.

It appears that most challenges are more operationally focused than technology focused. As observed in other areas of this report, it’s possible to implement a technology platform without also reviewing business processes, but simply implementing technology can’t fix poor processes. WFM systems for enterprise businesses can be notoriously difficult to implement due to their complex requirements. If organisations are not supported properly through the post-implementation phase, they generally end up falling back on old processes, or under-utilising the newly installed system. Every organisation should consider a change management plan to ensure everyone is on board when rolling out a new platform across the business. Even for SMBs, there are opportunities to save time and money by adopting a WFM solution, provided the implementation is well handled.

Just under a fifth (19%) of respondents said they have no real-time reporting (a slight decline on the 22% from 2019). However, 31% of mid-market respondents said this was a challenge. Having real-time visibility and reporting over day-to-day operational performance can give leaders more insight and control over how the workforce is managed – and that means significant cost and resource savings. The higher figure for mid-market makes sense when one considers that many mid-market organisations are in ‘scale up’ mode. As organisations outgrow the SMB space, real-time reporting becomes more important as they start to closely monitor their day-to-day scheduling activities and related wage spending.



Action:

● WFM solutions have increased in importance. With organisations making headlines for over- or under-payments and misinterpreting industrial instruments, it’s time to consider how technology can help in this area.

● Mid-market organisations in particular want more visibility of daily operations in tough economic times to ensure careful monitoring of wage spend vs. business demand.● For those still relying on manual processes, consider if the maximum value is being obtained from any solution already in place. Launch an education program if knowledge gaps are seen.

Simple tips – for example, calling staff to check availability vs. automated emails to the team – can reduce the time spent on staff schedules and rosters.● Workforce modelling based on previous consumer demand and other variables such as weather conditions (for certain businesses) can have a huge impact on the human resources used on a

daily basis. Such modelling is reliant on real-time, detailed reporting.

1 in 4 SMBs said they had no rostering /

time & attendance challenges

5 in 8 respondents have either fully implemented or are

currently implementing rostering / time & attendance technology

1 in 3 respondents said manual processes or workarounds

was their biggest rostering / time & attendance challenge

https://austpayroll.com.au/underinvestment-in-hr-and-payroll-expertise-leads-to-underpayments/


n = 356 35 79 127 115 313 43 213 112 31




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Ability to monitor shift and roster costs 15% 14% 8% 17% 17% 15% 14% 9% 26% 16%

Communication to employees about rosters and changes

18% 11% 19% 17% 20% 19% 14% 13% 23% 32%

Compliance 15% 11% 16% 15% 17% 17% 7% 12% 21% 23%

Data input errors 21% 31% 25% 16% 20% 21% 16% 16% 29% 23%

Ineffective leave management 21% 14% 18% 26% 19% 21% 21% 18% 25% 26%

Ineffective reporting 14% 11% 15% 13% 14% 15% 5% 7% 26% 19%

Ineffective rostering 17% 11% 18% 17% 17% 17% 14% 9% 28% 26%

Keeping up to date with industrial awards, etc.

15% 9% 16% 17% 14% 17% 2% 13% 20% 16%

Lack of flexible reporting 13% 9% 10% 16% 12% 13% 12% 8% 21% 16%

Highest value




n = 356 35 79 127 115 313 43 213 112 31




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Manual processes or workarounds 35% 37% 35% 32% 36% 35% 33% 28% 46% 42%

Monitoring certification eligibility to do particular shifts (e.g. licences, RSAs)

7% 9% 5% 7% 9% 8% 2% 5% 12% 6%


22% 20% 25% 21% 22% 23% 19% 17% 30% 29%

No real-time reporting 19% 9% 25% 18% 20% 21% 9% 13% 31% 23%

The effort to fill a roster 15% 11% 20% 13% 16% 16% 14% 11% 19% 32%

Too much absenteeism 14% 14% 13% 18% 10% 14% 14% 10% 16% 35%

Too much overtime 12% 9% 15% 13% 11% 14% 0% 8% 20% 16%


I don't know 8% 6% 13% 6% 7% 7% 9% 7% 7% 16%

Highest value




Measuring rostering / time & attendance process effectiveness

19%

15%

15%

5%

15%

13%

10%

47%

10%

21%

22%

13%

N/A

19%

14%

15%

41%

12%

Absenteeism / tardiness rates

Accuracy

Compliance (labour regulation)

Employee wellness

Number of missing or late timesheets

Overtime cost management

Time taken for processing


I don't know

Which metric(s) does your organisation use to measure the performance of its rostering / time & attendance

processes?

2020 (n = 356)

2019 (n = 284)



Summary:

47% of all respondents do not use any metrics at all to measure the performance or rostering / time & attendance processes – a 6 percentage point increase from 2019. There is significant variation by organisation size: 52% of SMB respondents don't use any metrics, compared to 43% of mid-market respondents and just 23% of enterprise respondents. The use of all metrics has decreased slightly year-on-year, with the exception of ‘compliance (labour regulation)’, which saw a minor increase. ‘Employee wellness’ – a new option in the 2020 survey – has special resonance to work rosters and schedules in relation to fatigue management.

Insight:

The lack of metrics being utilised by SMBs is surprising given that earlier in this report it was found that 22% of SMBs said workforce management took up too much time relative to the value it brought. If there are no performance measures in place, it’s highly likely the installed system is not being fully utilised, or there are time-consuming manual processes still in place. As the old saying goes, ‘old habits die hard’. There are still many organisations that stick with what they know, regardless of the time taken.

For businesses operating in certain sectors – particularly retail and hospitality – people-related costs will always be top of mind. This focus will only escalate as organisations recover from the trials of 2020. The effective and efficient rostering and scheduling of workers forms a key part of this. Cost control is a major focus, so not having up-to-date analytics or the ability to forecast accurately through use of POS or weather data can lead to the unnecessary cost of over-scheduling, or the operational issue of under-scheduling.

‘Absenteeism / tardiness’ is the most popular metric tracked, which may point to other wider issues at play in businesses and shouldn’t be treated as a sole reflection on WFM or rostering / time & attendance effectiveness. For example, high levels of absenteeism may point to a toxic culture, bullying or harassment. For assessment of WFM and rostering / time & attendance effectiveness, metrics relating to data accuracy, compliance, overtime cost management and time taken for processing should all factor highly.

The increase in compliance (labour regulation) as a metric is not surprising due to the heightened awareness of wage theft in Australia and New Zealand. This is a big win for employees who can take more comfort in knowing they are being paid correctly when their business is using a WFM solution.

Action:

● The lack of metrics is disconcerting. Even at an executive level, 55% do not use any metrics at all. However, what gets measured gets managed, so having a basic level of metrics is critical. With HR, and in some instances even Payroll, wanting to obtain and sustain a seat at the executive table, these insights will be invaluable.

● Cost control in relation to staff rostering and scheduling can make or break people-related budgets – particularly in industries where shiftwork or irregular working hours are required. Utilise the reporting functions and metrics available through rostering / time & attendance software to stay within budget and avoid staff-related cost blowouts.

● Don’t fall back on old processes. Organisations that are not supported properly through the post-implementation phase for new technology generally end up falling back on old processes or under-utilising the newly installed system. Use the opportunity presented by new technology to re-examine the underlying processes and fine-tune or overhaul these if required.

https://www.theage.com.au/politics/victoria/australia-s-first-wage-theft-laws-set-to-pass-in-victoria-20200614-p552fn.html

https://www.nzherald.co.nz/business/employers-stealing-from-staff-a-widespread-problem-expert/LQ434CZCOJX55JJHRZB57OTJE4/


n = 356 35 79 127 115 313 43 213 112 31

Which metric(s) does your organisation use to measure the performance of its rostering / time & attendance processes?



Senior management

C-suite leaders



(1 - 199) (200 - 1999) (2000+)

Absenteeism / tardiness rates 19% 23% 22% 20% 14% 20% 12% 14% 23% 35%

Accuracy 15% 9% 15% 17% 15% 15% 14% 15% 16% 13%

Compliance (labour regulation) 15% 11% 13% 19% 13% 15% 14% 13% 18% 19%


Number of missing or late timesheets 15% 17% 14% 18% 11% 15% 12% 13% 18% 16%

Overtime cost management 13% 11% 14% 13% 14% 14% 9% 10% 16% 26%

Time taken for processing 10% 6% 8% 11% 10% 11% 2% 8% 13% 13%


I don't know 10% 23% 15% 6% 8% 11% 9% 9% 13% 13%

Highest value




Highest value




Which metric(s) does your organisation use to measure the performance of its rostering / time & attendance processes?


n = 205 n = 129 n = 56 n = 20 n = 150 n = 84 n = 56 n = 10

Absenteeism / tardiness rates 24% 17% 30% 50% 12% 10% 16% 10%

Accuracy 18% 19% 21% 5% 11% 8% 11% 30%

Compliance (labour regulation) 18% 16% 21% 20% 11% 8% 14% 20%

Employee wellness 7% 10% 2% 5% 1% 2% 0% 0%

Number of missing or late timesheets 20% 17% 25% 25% 8% 7% 11% 0%

Overtime cost management 17% 14% 18% 35% 8% 4% 14% 10%

Time taken for processing 13% 12% 16% 10% 5% 1% 9% 20%


I don't know 10% 6% 18% 10% 11% 13% 7% 20%



Tools to manage rostering / time & attendance

18%

18%

15%

12%

12%

11%

11%

11%

9%

9%

8%

7%

5%

5%

10%

N/A

21%

N/A

13%

11%

N/A

N/A

N/A

N/A

16%

N/A

7%

N/A

N/A

7%

Paper-based rostering and interpretation

Stand-alone time & attendance software

Employee clock in / out manual sign-in / timesheets

Integrated HR, rostering and time & attendance software

Stand-alone rostering software

Rostering and interpretation spreadsheets

Employee clock in / out finger vein scanners

Employee clock in / out tablet terminals with pin code / user sign-in

Employee clock in / out with mobile app / geofencing

Integrated HR and time & attendance software

Employee clock in / out access / swipe cards

Integrated HR and rostering software

Employee clock in / out tablet terminals with facial recognition

Employee clock in / out bundy clocks / time clocks

I don't know

How does your organisation currently manage its rostering / time & attendance processes?

2020 (n = 351)

2019 (n = 281)



Summary:

When it comes to the tools used for WFM and specifically rostering / time & attendance, ‘stand-alone time & attendance software’ and ‘integrated HR, rostering and time & attendance software’ saw minor drops compared to 2019. However, the biggest dip occurred for ‘integrated HR and time & attendance software’, which fell 7 percentage points from last year’s results. The only minor increase was seen with ‘stand-alone rostering software’, which rose from 11% to 12%. It’s apparent that manual processes are still used extensively, as seen by the top-rated ‘paper-based rostering and interpretation’ and the third-rated ‘employee clock in / out manual sign-in / time sheets’ options.

Viewing results by organisation size, it seems enterprise organisations are more open to emerging technology, with finger vein scanners the equal second most commonly used tool. In contrast, the top choice for SMBs was ‘paper-based rostering and interpretation’.

Insight:

The use of paper-based rostering and interpretation by 30% of mid-market and 60% of enterprise organisations (for those without fully implemented technology) is naturally less common amongst those who do have fully implemented technology (7% and 15% respectively). However, these are still high figures when one considers the relatively widespread use of technology for these two size segments in other functional areas.

For those enterprise organisations with fully implemented technology, the preference is for ‘integrated HR, rostering and time & attendance software’ (40%), followed by ‘employee clock in / out finger vein scanners’ (25%).

For mid-market organisations, the preference is for ‘stand-alone time & attendance software’ (29%), ‘integrated HR, rostering and time & attendance software’ and ‘employee clock in / out tablet terminals with pin code / user sign-in’ (both with 20%).

SMBs favoured ‘stand-alone time & attendance software’ (20%).

How can these differences be accounted for? Most SMBs will add software to meet particular needs as and when they arise. It’s possible the experience with WFM has not been “painful” enough to make the jump. Enterprise organisations, on the other hand, will often look to implement a platform that meets all their needs – as seen in the consistent showing for integrated platforms.

One emerging trend is the use of biometrics. Although fingerprint, face and voice scanning has been around for some years, they are only now gaining traction – and even then, there is some reluctance. There are privacy concerns with facial recognition, and the concern over finger scanners is topical – that is, having multiple people touch the same scanner. However, once these challenges are overcome – with touchless options, for example – it seems certain that biometrics will allow for employee monitoring and management at a highly secure and efficient level. Rather than worrying about faked timesheets, entry into certain areas, and other, similar matters, employers can let technology handle all the work on the front end via biometric hardware and software.



Other areas to watch are geolocation and geofencing, aided by leveraging existing global positioning systems (GPS). Geolocation is defined as the process or technique of using digital information processed via the internet to identify the geographical location of a person or device. This technology can be programmed to take location, date and time stamps when an employee clocks in or clocks out. Geofencing uses GPS or Radio Frequency Identification (RFID) to create a virtual geographic boundary. This enables software to trigger a response when a mobile device enters or leaves an area. The system can be configured to send notifications to employees when they enter or leave the job site to clock in or clock out. Managers can be notified when certain employees arrive at or leave a site.

Action:

It’s easy to take WFM solutions for granted – unless, of course, there isn’t one implemented. COVID-19 has demonstrated the critical role such solutions can play. The abilities to stagger shifts and break times to minimise crowding in high traffic areas, incorporate flexibility to allow for increased cleaning of common spaces, and schedule enough time for employees to put on and take off protective clothing, are only possible with smart WFM software.

Consider current strengths and gaps in existing HR-related technology, including WFM software. Experienced HR observer Dave Ulrich suggests asking these four questions as part of an overall HR technology audit:

1. To what extent do we use technology to streamline administrative HR work?2. To what extent do we use technology to innovate our HR practices?3. To what extent do we use technology to access information?4. To what extent do we use technology to create social experiences and connections?

1 in 9 respondents use stand-alone time &

attendance software

1 in 9 respondents use paper-based

rostering and interpretation

https://www.shrm.org/resourcesandtools/hr-topics/technology/pages/self-service-scheduling-apps-benefit-hourly-workers-managers.aspx

https://www.linkedin.com/pulse/do-hr-technology-audit-get-most-digital-dave-ulrich/


n = 351 34 78 125 114 309 42 210 111 30




Senior management

C-suite leaders


(1 - 199) (200 - 1999) (2000+)

Employee clock in / out access / swipe cards 8% 6% 8% 8% 10% 8% 7% 3% 15% 20%

Employee clock in / out bundy clocks / time clocks 5% 9% 5% 5% 4% 5% 5% 3% 5% 17%

Employee clock in / out finger vein scanners 11% 6% 12% 10% 11% 11% 5% 6% 14% 30%

Employee clock in / out manual sign-in / timesheets 15% 9% 12% 18% 15% 15% 17% 12% 15% 30%

Employee clock in / out tablet terminals with facial recognition

5% 6% 6% 3% 6% 6% 0% 5% 5% 7%

Employee clock in / out tablet terminals with pin code / user sign-in

11% 9% 9% 13% 10% 11% 7% 8% 14% 13%

Employee clock in / out with mobile app / geofencing 9% 9% 10% 10% 8% 9% 12% 9% 10% 10%

Integrated HR and rostering software 7% 12% 13% 6% 2% 7% 5% 5% 8% 17%

Integrated HR and time & attendance software 9% 18% 13% 6% 6% 8% 10% 8% 7% 17%

Integrated HR, rostering and time & attendance software

12% 21% 10% 10% 12% 12% 12% 9% 13% 33%

Paper-based rostering and interpretation 18% 18% 17% 20% 18% 18% 19% 16% 19% 30%

Rostering and interpretation spreadsheets 11% 9% 10% 12% 12% 12% 7% 9% 16% 10%

Stand-alone rostering software 12% 9% 22% 8% 11% 13% 7% 10% 11% 27%

Stand-alone time & attendance software 18% 21% 19% 21% 14% 19% 14% 16% 22% 20%

I don't know 10% 15% 12% 5% 14% 10% 12% 12% 10% 0%

Highest value




Highest value


Tool to manage rostering / time & attendance




n = 202 n = 127 n = 55 n = 20 n = 149 n = 83 n = 56 n = 10

Employee clock in / out access / swipe cards 8% 4% 15% 20% 8% 1% 16% 20%

Employee clock in / out bundy clocks / time clocks 6% 6% 5% 10% 3% 0% 4% 30%

Employee clock in / out finger vein scanners 13% 9% 16% 25% 7% 1% 11% 40%

Employee clock in / out manual sign-in / timesheets 13% 13% 11% 20% 17% 12% 20% 50%

Employee clock in / out tablet terminals with facial recognition 7% 7% 11% 0% 2% 1% 0% 20%

Employee clock in / out tablet terminals with pin code / user sign-in 12% 9% 20% 5% 9% 6% 9% 30%

Employee clock in / out with mobile app / geofencing 11% 12% 11% 10% 6% 4% 9% 10%

Integrated HR and rostering software 7% 6% 9% 10% 7% 4% 7% 30%

Integrated HR and time & attendance software 10% 9% 9% 20% 7% 7% 5% 10%

Integrated HR, rostering and time & attendance software 18% 13% 20% 40% 4% 1% 5% 20%

Paper-based rostering and interpretation 12% 13% 7% 15% 27% 20% 30% 60%

Rostering and interpretation spreadsheets 9% 9% 9% 10% 15% 10% 23% 10%

Stand-alone rostering software 9% 10% 7% 10% 15% 11% 14% 60%

Stand-alone time & attendance software 22% 20% 29% 15% 13% 10% 14% 30%

I don't know 9% 10% 9% 0% 12% 14% 11% 0%



n = 351


10%

31%

31%

15%

4%

9%

Excellent

Good

Average

Poor

Very poor

I don't know


managing rostering / time & attendance?



Summary:

Overall, rostering / time & attendance and WFM systems and processes were reasonably well rated. It’s significant that satisfaction with internal WFM systems and processes more than doubled across all markets when technology was implemented. SMBs (45%) and enterprise organisations (40%) were the most satisfied, rating their systems and processes as ‘good’ or higher, while mid-market organisations were slightly less impressed, with only 30% granting the scores of ‘good’ or above. More mid-market organisations (27%) rated their systems and processes as ‘poor’ or below when compared to SMBs and enterprise organisations.

Insight:

Having the right systems in place can take pressure off business owners and help them ensure they are compliant with current legislation and pay obligations. While the level of satisfaction was generally fair for WFM and rostering / time & attendance systems and processes, there is plenty of room for improvement. Clearly, technology is an enabler here. Manual processes are unable to keep up with the demands and requirements of modern-day workplaces. The modern industrial landscape is complex. Mistakes can and unfortunately do happen – but complexity, data collection mistakes and misinterpreting industrial instruments such as Enterprise Bargaining Agreements and Awards is no excuse for pay-related mistakes.

Viewed in this way, it’s no surprise that mid-market organisations are suffering from ‘growing pains’ and may be slightly less impressed with the systems and processes they have in place.

WFM tools can go some way to effectively and efficiently managing business processes and wage cost, especially when measured against error-prone and time-consuming manual systems.

Action:

● Reassess the critical role that effective workforce management can play in business success. WFM started as a scheduling process but has since grown into a multi-faceted framework for maintaining human capital, budgeting and workforce scheduling. The ultimate goal is to optimise productivity and reduce unnecessary expenditure.

● Understand the work required to do each job task, while prioritising efficiency and safety. From that seemingly simple basis, it’s possible to determine demand-based forecasts, schedule the appropriate number of workers and measure performance to provide feedback and incentives to workers. Along the way, employees are paid fairly and accurately for the hours worked.

● WFM doesn’t just focus on employee performance and scheduling, it also determines how organisations should invest in their employees. A solid WFM strategy involves online training and supervisor-based coaching to ensure employees are up to date on the latest skills for their jobs. When implemented correctly, WFM and careful rostering / time & attendance can help reduce costs and improve customer service through consistent and automated monitoring of the workforce. It becomes easier to predict future demands for seasonal talent and can assist in making smarter decisions if cuts are needed within a certain department.

● If resources allow and the task is big enough, consider creating a dedicated workforce management analyst role. The role requires a combination of human resources, analytics and operations skills. Such a professional is responsible for collecting data on the organisation’s workforce, analysing that data to determine trends, and creating plans and operational goals for the business.

https://www.hrmonline.com.au/industrial-relations/fresh-look-modern-awards-industrial/



n = 351 34 78 125 114 309 42 210 111 30

Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing rostering / time & attendance?



Senior management

C-suite leaders


Excellent 10% 12% 5% 8% 14% 9% 12% 12% 6% 3%

Good 31% 32% 35% 25% 34% 30% 36% 33% 24% 37%

Average 31% 38% 28% 38% 23% 31% 31% 31% 32% 27%

Poor 15% 9% 18% 21% 10% 17% 7% 11% 22% 20%

Very poor 4% 3% 3% 2% 9% 4% 7% 2% 7% 7%

I don't know 9% 6% 12% 6% 11% 9% 7% 10% 8% 7%

Highest value




Highest value



Overall, how would you rate your organisation's internal systems and processes for efficiently and effectively managing rostering / time & attendance?


n = 202 n = 127 n = 55 n = 20 n = 161 n = 83 n = 56 n = 10

Excellent 13% 16% 11% 5% 4% 7% 2% 0%

Good 40% 42% 35% 45% 17% 20% 14% 20%

Average 28% 27% 31% 30% 32% 37% 34% 20%

Poor 9% 7% 13% 15% 22% 18% 30% 30%

Very poor 0% 0% 0% 0% 9% 6% 14% 20%

I don't know 9% 9% 11% 5% 8% 11% 5% 10%



Questions?

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