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Orgs losing $56b per year to admin burdens

Non-essential tasks and poor performing technology are eroding employee engagement and productivity, costing Australian and New Zealand organisations $56 billion per year, a new study reveals.

Workforce management solutions provider Kronos partnered with Coleman Parkes Research to assess the the level of engagement within Australian and New Zealand businesses.

As part of this undertaking, the researchers conducted 500 interviews with people from organisations with more than 600 employees, including business/operations managers, HR professionals and employees.

Key findings

  • One in five respondents (19%) found it difficult to complete daily tasks due to complications including inadequate staffing, poor technology support, internal politics and unrealistic workloads.
  • On average, respondents are wasting three hours per week on ‘unnecessary administrative tasks’. With 14.3 million people in employment in Australia and New Zealand, this equates to an annual loss of $55.8 billion for organisations – or $3,900 per employee, per year.
  • Reducing wasted time by one hour per week, per employee would save organisations $22 billion annually – or $1,548 per employee per year.
  • More than half of all HR managers (52%) do not consider employees one of their organisation’s top three assets, suggesting employee engagement is not currently a priority for business leaders. Similarly, 55% of respondents believe their CEO prioritises numbers over people and just 28% rate employee engagement as ‘strong’ in their organisation.
  • 72% of respondents cited loss of productivity caused by out-dated systems and technology while 62% believed employee engagement would improve if was better, up-to-date workforce management technology was implemented.
  • There was no indication that increasing salaries would boost employee engagement and retention rates, with remuneration ranking 10th out of 11 potential reasons for why people quit. Three in four employees (73%) were more likely to resign due to a lack of direction, and around half of respondents (49%) said rewards and incentives would not increase productivity.

A ‘wake-up call’ for organisations

According to Peter Harte, managing director of Kronos Australia, New Zealand and South East Asia, the findings are a ‘wake-up call’ for organisations to embrace automation technology, reduce administration and paperwork and make other changes necessary to unburden their workforce from unnecessary complications at work.

“It’s time to start conversations on what changes are required to drive improved productivity in order to deliver profitability and growth,” he said.

“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.”

Also commenting on the study, Joyce Maroney, director of The Workforce Institute at Kronos, called on organisations to boost engagement by treating their employees as valued assets not as an expense

“Strong employee engagement is fundamental to a business’ bottom line, with engaged employees much more likely to go the extra mile,” she said.

“However, this [study] 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.”

For more information about the study, read Kronos’ The $56bn Question report.

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James Harkness

James Harkness

James Harnkess previous editor at Dynamic Business

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