Unnecessary admin costing Aussie businesses $56 billion

$56bn per annum - that's how much organisations in Australia and New Zealand are wasting on unnecessary administrative tasks, according to new research from The Workforce Institute at Kronos Incorporated and Coleman Parkes Research.

Employees across Australia and New Zealand are overburdened with non-essential tasks, impacting productivity and creating losses of AU$3,900 per year, per employee, per organisation.

The $56bn Question report reveals workforces are burdened by complexity and poor performing technology.

Peter Harte, managing director, Kronos Australia, New Zealand and South East Asia called the report a "wake-up call".

"It's time to start conversations on what changes are required to drive improve productivity in order to deliver profitability and growth.

"Workforce management solutions are already available to empower an organisation's workforce to do so. There is no need to wait. Savings reaped from workforce management solutions can be reinvested in new innovation to sustain competitiveness through an engaged workforce culture."

The report recommends organisations need to boost employee engagement by treating their people as valued assets not as an expense. By increasing collaboration and reducing the administration burden through automation technology organisations are able to empower employees to increase productivity and profitability.

"Strong employee engagement is fundamental to a business' bottom line, with engaged employees much more likely to 'go the extra mile'," said The Workforce Institute Director Joyce Maroney.

"However, this report demonstrates that engagement is not currently a core focus for HR teams or business leaders.

"To retain talent and create a motivated, productive workforce, businesses need to put their focus on their people through better communication and collaboration. This is the solution to the $56bn Question."

At A Glance:

  • Stuck in the middle. People are torn between meeting customer needs and manager expectations:
    • The report reveals that one in five respondents (19 per cent) find it difficult to complete their daily tasks due to workplace complexity.
    • The factors creating this complexity include lack of staff availability, poor technology support, internal politics, and unrealistic workloads. These issues make it difficult to maintain customer service levels in today's 24/7 business environment.
    • Respondents claim the answer to simplifying the working day lies in reducing administration and paperwork and providing the technology to automate appropriate tasks.
  • Small changes can reap big rewards. Clawing back just one hour of time wasted on non-essential tasks each week could save organisations billions of dollars:
    • On average, an employee in Australia and New Zealand wastes three hours each week, with most of this time taken up by unnecessary administrative tasks - equating to 6 per cent of an average working week or AU$3,900 a year based on an average income.
    • With 14.3 million people in employment in Australia and New Zealand, this creates a potential AU$55.8bn opportunity cost annually to ANZ organisations.
    • Reducing wasted time by one hour, per week, per employee would save AU$1,548 per employee, per year - or AU$22bn per annum.
  • Why your greatest asset shouldn't be a liability. Engagement is critical to business continuity and success, because engaged employees are much more likely to "go the extra mile". However, this engagement is not currently a priority for ANZ business leaders:
    • 55 per cent of respondents think the CEO is only focused on the numbers, rather than the people who deliver the work.
    • More than half (52 per cent) of HR managers do not consider employees one of their organisation's top three assets.
    • Just 28 per cent of respondents rate employee engagement as 'strong' in their organisation.
  • Bridging the productivity gap. The impact of poor technology on engagement and productivity levels was prevalent throughout the report. Organisations must focus on implementing the right technology to make working life easier.
    • 72 per cent of respondents cited loss of productivity caused by out-dated systems and technology.
    • 62 per cent of respondents say better, up-to-date workforce management technology would improve employee engagement
  • It's not a dash for cash. Increasing the salaries of disengaged employees will not boost engagement or keep them in the business:
    • Remuneration was low on the list of reasons why employees would leave their job, ranking 10th out of 11 potential reasons for resigning.
    • Just over half (51 per cent) of respondents said rewards and incentives would increase productivity.
    • Statistically, 73 per cent of employees from across ANZ are more likely to resign if they lack direction or can no longer see their future within a company.

Research Methodology

This assessment of the level of engagement within Australian and New Zealand businesses is based on 500 detailed interviews with line of business/operations managers, HR professionals, and employees amongst a cross section of ANZ-based organisations employing more than 600 employees. Research was conducted in January and February 2016 by independent, third-party firm Coleman Parkes Research.

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