Building a High Performance HR Organisation in Australia

An insight into transformational HR in Australia primary research and analysis of HR functions

The Research Project and High Performance HR

In late 2005 / early 2006, Accenture in conjunction with Fairfax Business Research, surveyed a number of leading Australian organisations about their HR function and their attitudes towards HR. The research asked a number of detailed questions of both HR and non-HR management in many cases from the same organisation. This quantitative research was supplemented by qualitative analysis, through a series of roundtable discussions with HR executives. The research provided a unique snapshot of how Australian organisations view the HR function. It was focused around a number of key themes: What should be the contribution of the HR function to change initiatives in the organisation, now and in the future? How can organisations measure the benefit to organisational performance delivered by HR? How can HR leverage the use of technology to fulfil its objectives and deliver value? What part in HR transformation will be played by alternative HR sourcing options? This report examines some of the researchs key findings and places them within the context of Accentures global work in helping organisations deliver high-performing HR functions. It looks at the key issues facing HR and other managers in Australia today as they seek to achieve this high performance. High-performing HR functions prioritise human capital investments based on organisational value. They provide vital input to fiscal and operational planning, and ensure organisations have the right HR capabilities in place to meet changes in economic conditions, strategies or structures, and support large-scale workforce transformation. High performing HR functions reshape traditional HR, learning and development functions and align them more closely to new organisational strategies.
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Based on the research our hypothesis is that many Australian HR operations still do not have these characteristics. Too often HR is regarded as a tactical, rather than a strategic function, focusing largely on operational matters. The research provides a basis to identify areas which may be lacking, and which when properly addressed can help organisations make the transition to high performance HR.

Executive Summary
The HR function in Australia faces many challenges. There are significant shortages of talent, partially as a result of increased global competition for jobs. The population and the workforce are ageing, and at the same time younger people are displaying differing attitudes towards work and careers. In late 2005 / early 2006, Accenture and Fairfax Business Research surveyed 78 leading Australian organisations about HR and how it functions in their organisations. The managers surveyed were spread across a wide range of organisations in the public and private sectors. As might be expected from such a diverse group, there were many different views on the role of the HR department, and on how it should fulfil that role. Some organisations were advanced in their thinking, displaying an integrated and strategic approach to HR, but they were in the minority. Most organisations still display a view of HR that is centred on transactional processing or the streamlining of existing functions, rather than the development of a set of integrated HR and organisational capabilities.

Key Finding 1 HR would like to be more strategic

HRs own view of itself differs significantly from how others within the organisation view its function. HR is perceived by other parts of the organisation as a source of information, or as largely centred on delivering specific outcomes, such as payroll, while HR managers themselves generally see the departments function as combining a mix of strategic, advisory and operational roles. The area in which most respondents agreed was that a thorough knowledge of and understanding of the organisation is fundamental to the success of the HR function. The research suggests that HR needs to be a problem solver and to provide solutions that fit with the strategic direction of the organisation.

Key Finding 2 There is disagreement over the obstacles to HR shaping and leading strategic change
A major challenge for HR is to ensure that other parts of the organisation see it in the same light as it sees itself, as an integral part of ensuring the delivery of high performance capabilities, rather than as a secondary transactional function. HR needs to provide relevant and insightful advice, based on knowledge of the workforce and culture to enable better strategic business decisions. Many HR executives believe they suffer from a lack of time to work on strategic programs, largely due to the constant demands of delivering basic HR functions. Some of the pressures stem from the focus on controlling costs, both within HR and across the workforce.

Key Finding 3 HR measures its processes, but doesnt effectively tie the measurements to organisational outcomes
The HR function needs to more accurately measure what it does and drive a more definitive link to business outcomes, as well as promoting this to the rest of the organisation.

Key Finding 4 HR does not utilise technology as well as it could

Technology solutions implemented have largely been disappointing to HR executives. The solutions have often not delivered functionally or financially, and the benefits are proving difficult to quantify.

Key Finding 5 HR has not fully considered the use of alternative sourcing options
The HR function is increasingly looking at alternative sourcing options, although in most organisations only the more transactional elements (as opposed to more value adding activities) have as yet been considered. This represents a more limited focus on outsourcing than that being found in global organisations. By not considering other options, many Australian HR functions are missing out on the higher value outsourcing opportunities. The results of the research project indicate both challenges and opportunities for those responsible for the HR function in Australian organisations. The research suggests that there is further transformation required for many Australian HR functions before they can be regarded as truly high performing. In particular,

if HR departments are to maximise their potential, they need to more effectively: 1 demonstrate they understand the challenges in the business units of their organisations. This will allow them to define how to deliver against the strategic high performance capabilities the organisation requires. 2 understand their key stakeholders and their expectations. 3 demonstrate that HR is fulfilling its core functions before looking to its strategic aspirations. 4 transform themselves first, before focusing on other parts of the organisation. 5 define and promote HRs role internally. 6 measure both the efficiency and effectiveness of the function, demonstrating a clear link between human capital activity and organisational performance.

The requirements of each individual organisation will of course vary, and many are further along the transformation journey than others. But there is no doubt that whatever the progress every HR organisation needs to ensure it is equipped with staff that have the right skill set for the journey ahead. Without this transformation will fail.

Introduction
This report examines in detail the findings of the research and the challenges facing HR in Australia today. It uses those findings and the results of other Accenture research internationally to suggest ways that HR can fulfil its role as a key enabler in creating the high performance organisation1. The value of a high-performing workforce is not in doubt. What is at issue is the ability of the HR function to have a positive impact on the workforce and deliver value to the organisation. The research shows that few senior executives in Australia are satisfied with their progress on core HR initiatives that are critical to sustaining competitive advantage. The role of the HR function is changing or should be changing significantly. Successful twenty-first century professionals understand that the hard work of global business is not just about reducing costs it is also about making the pieces of the puzzle fit efficiently together. The old adage of thinking globally and acting locally now has greater implications. There are many challenges2 to the HR function:

1 The global talent hunt. Workforces are becoming more international, and issues such as offshoring and integrating with foreign affiliates and associates have become significantly more important. The search for the best qualified individuals has moved from the local to the global level. 2 The evolution of work. Workforces are becoming more distributed and more mobile. We are seeing more telecommuters, more satellite offices, and the increased use of contractors and loosely affiliated members of virtual corporate teams. Virtual organisations are now an accepted norm. Acquisitions and restructures are forcing organisations to rebuild corporate cultures from scratch, and global and multicultural issues are more important than ever before. 3 The ageing workforce. The demographic mix is changing. The median age of the Australian population has increased from 34 years in 1996 to 36 years today, and on current trends will continue to rise3. That means that the average
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age of the workforce is also rising. This trend is exacerbated by babyboomers nearing retirement age (the first of them turn 60 in 2006) but not retiring. Their skills may not be appropriate to the demands of the changing business environment, or may not be sought by managers young enough to be their children. There are moves to delay the retirement age and retrain older workers. Younger workers, meanwhile, often have widely different expectations about their careers than the generations who preceded them. 4 Changed educational and industrial structures. There are also continuing major changes in the tertiary and vocational education systems, and to industrial relations laws. The mix of full-time, part-time and casual jobs is changing, and the average worker can expect to change careers a number of times in their lives. 5 The management of employee and customer privacy. Privacy and related issues require more attention than ever before. Every jurisdiction deals

with privacy in a slightly different way, and there are a range of ethical and management issues which means that HR is the natural profession to implement and administer effective policies. 6 The demands of compliance and corporate governance. Around the world, there are increasing imperatives to comply with a range of corporate governance issues. The best known of these is SarbanesOxley for companies with group operations in the USA, but there are many other regulations, such as Basel II in the financial industry, CLERP 9 for Australias public companies, and IFRS (International Financial Reporting Standards) for all Australian organisations. Many aspects of these compliance regimens have to do with personal behaviour, and are natural areas for increased involvement by the HR function. These are complex and increasingly important issues. These issues are such that HR professionals are most likely to be the individuals within

Figure 1: From traditional HR to transformed HR

Transformed HR
Strategic solutions, High Performing Workforce Increased revenue per FTE Improved employee satisfaction Reduced voluntary turnover Increased retention of key talent Improved workforce performance

Effectiveness Improvement

(Strategic HR Workforce)

Challenge Continues

Evolved HR
Reorganised, proactive services Increased ability of HR to focus on strategic tasks Reduced cost per hire Reduced time to proficiency Increased customer satisfaction levels Lower HR influenced costs

Streamlined HR Traditional HR
Rules & compliance focused, manual, back office function Reduced cost to serve Reduced HR operating costs per FTE Decreased manager time per HR transaction Decreased cycle time per HR transaction

Making Progress

Efficiency Improvements

(Technology-enabled Service Delivery)

the organisation with the strategic capabilities to translate them into business value. Furthermore many of these issues are exacerbated by the fact that Australias economy is growing strongly. This growth has been supported by consumer spending and growing offshore demand for Australias natural resources by Asian growth economies, particularly China. This activity is not limited to the private sector. The Australian public sector has also been enjoying high levels of economic activity. The strong economy has meant a steady growth in tax revenues, and the Federal budget has been in surplus for many years. The share of the economy accounted for by government expenditure is average by OECD standards4, but has been high enough to sustain substantial infrastructure development in recent years. As a consequence of this economic position, Australia is experiencing historically high levels of employment5 and soaring demand for skilled workers

in most industry sectors. Employers, executive search firms and personnel agencies are struggling to find the right people because of significant skills shortages in many areas. This war for talent is intensifying, making it even more difficult for organisations that do not excel in human capital management to compete.6 In studies that Accenture has conducted internationally, business executives have indicated that they believe that the talent shortage will become an even bigger problem in the years to come.7 High performance HR will play a key role in helping organisations take advantage of the opportunities and challenges offered by changing economic, social and demographic circumstances. The focus of HR in recent years, in Australia and globally, has been to streamline its transactional functions and reduce the cost of delivering employee processes. But streamlining is not transformation it is only an initial phase. To be truly effective HR should help build the capabilities that can deliver real benefit to the organisation

and help it achieve its business goals. That is high performance HR. In a transformed HR model (Figure 1), enhanced HR roles and competencies are organised into a new HR Service Delivery Model and supported by common policies and processes and an integrated HR information system. Accenture research around the world shows that HR must transform itself before it can transform other parts of the organisation. This requires a solid vision of what the HR function should look like, a dedicated delivery team with the appropriate competencies, and the discipline to execute.

The Research Findings

The key findings of Accentures 2005 Australian High Performance HR research project are presented below. These findings are based on: A quantitative survey of 60 HR executives and 33 non-HR executives across 78 Australian organisations. Four qualitative roundtable discussions of HR issues, one in each of Brisbane, Canberra, Melbourne and Sydney. These roundtables were attended by 38 HR executives. The organisations had an average number of 6386 employees, and were drawn from a range of industry sectors, including government.

Key Finding 1
HR would like to be more strategic
When asked which of a range of functions comprised HRs most important contribution to an organisations change initiatives, HR managers are most likely to mention factors relating to strategic insight (mentioned by 35 percent of all HR respondents). The next most significant factors relate to process knowledge and policy knowledge, each mentioned by 22 percent of HR respondents. About 10 percent of respondents mentioned other factors, which include recruitment, operational or technical expertise, and implementing cultural change. These views differ significantly from how other senior executives believe HR can best contribute to change initiatives. By far the most common response (36 percent) among nonHR executives was the provision of information, with strategic insight (21 percent) and process knowledge (18 percent) less frequently mentioned. The results indicate a significant divergence in the views of HR and nonHR executives as to HRs role. Non-HR executives do not rate the strategic abilities of HR nearly as highly as do HR executives. Even within the roundtables there was some divergence. HR executives made comments such as: The HR department does not lead change. HR creates the systems and architectures that facilitate change. HR is a conduit to make change happen. The role of HR is to operationalise the strategic intent. The HR strategy should not be different from the business strategy The theme of these and other comments is very consistent HR executives themselves generally believe that HRs role is a bridge between the operational and the strategic. They believe HRs role to be significantly more strategic than do non-HR executives.

Figure 2: HRs contribution to an organisations change initiatives

Provision of Information Strategic Insight Process Knowledge Policy Knowledge Other 12 12 13 21 18 36

35

22 22

8 0

Other Senior Executives HR Executives

10

20 Percentage of Respondents

30

40

10

Key Finding 2
There is disagreement over the obstacles to HR shaping and leading strategic change
Respondents were also asked what they believe to be the obstacles to HR shaping and leading strategic change initiatives. Once again, this question was addressed quite differently by HR and non-HR respondents. Nearly half (48 percent) of HR executives believe the main obstacle is that they suffer from a lack of time to work on strategic programs, while only about one quarter (27 percent) of non-HR respondents regard this as the dominant factor. Non-HR executives are more likely to mention HRs lack of business context or project management expertise (15 percent for each factor), which were mentioned by very few HR respondents. Many HR and non-HR respondents mentioned a range of other factors such as insufficient funding or resourcing for HR as a key obstacle. HR respondents are more likely to believe that other external obstacles, such as a lack of credibility in the organisation or a lack of commitment from elsewhere in the organisation, are key obstacles. Once again, HR and nonHR respondents differ. Other commentary at the HR roundtables focused on needing to ensure that HR functions are appropriately skilled to meet the strategic requirements of the business.

Figure 3: Obstacles to HR shaping and leading strategic change initiatives

Lack of time to spend on strategic programs Lack of project management expertise Lack of business context Lack of accurate and detailed HR information Other
3
3
5

27
15
15

48

39 37

Other Senior Executives HR Executives

10

20

30

40

50

Percentage of Respondents

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Key Finding 3
HR measures its processes, but doesnt effectively tie the measurements to organisational outcomes
As with most other business functions, HR needs to accurately measure its activities to ensure a definitive link to business outcomes. There are two key areas of measurement: Efficiency, or how cost-effectively the HR function fulfils its functions. These may be thought of as input measurements. Effectiveness, or how well the HR function is contributing to or influencing other parts of the organisation. These may be thought of as output measurements. Efficiency is typically measured through cost-related metrics. There is general agreement between HR and non-HR respondents (see Figure 4). The most widely used measure is the total cost of the HR function, which is often extended to the measurement of this cost against the total costs of the organisation, or against the total number of full-time equivalent (FTE) employees. Other measures include detailed analyses of labour costs, various project management metrics, rates of change in the above metrics, actual performance against budget, and various metrics specific to the organisation of the industry in which it operates. Respondents to the survey were also asked whether their organisation measures the effectiveness of the HR function. There were some differences in the responses of HR and non-HR executives, but generally speaking they were in agreement on the overall rankings given to each measure. The four most commonly used measures are: Turnover and retention. This is usually measured through metrics generated from HR and payroll systems. Product or service quality. This is most widely measured through customer satisfaction, research surveys and key performance indicators (KPIs). External customer satisfaction. This is measured formally through customer surveys, and informally through other customer feedback mechanisms, including complaints and call centre feedback.

Figure 4: Measuring the efficiency of the HR function

Total HR Cost HR Costs / Total Costs HR Costs per FTE Other 18 13 0 20 40 60 Percentage of Respondents 80 61 58 73

50

52 52

Other Senior Executives HR Executives

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 Employee satisfaction. This is measured through employee surveys, exit interviews, and formal and informal staff feedback mechanisms. Also measured in many organisations is employee productivity and business or functional unit satisfaction. Other measures less widely mentioned by respondents include financial performance, attendance rates, occupational health and safety (OH&S) data, compliance, and industry-specific measures such as ministerial input (government) and patient turnover (health). While they report that they use metrics extensively, in the roundtable conversations that accompanied the quantitative research it became apparent that some HR executives are not being as effective as they could be in this area it is one thing to measure, it is another to use the information successfully. While the

research indicated a high degree of usage of various metrics, these are not often used as a method for properly evaluating the extent to which the HR function engages with the rest of the organisation. There is little effort given to linking measures of HRs effectiveness and HRs efficiency. Taken in isolation they are of only limited value. The right metrics, intelligently used, can provide an effective method of demonstrating the direct link between HR and organisational performance. It is much easier for HR to justify the contribution it is making if it can point to measurable areas where it is helping improve that performance. As one roundtable participant observed, it can be very difficult to measure organisational value. Often it is difficult to know even what to or how to measure. HR traditionally has not been good at analysing results, but such analysis would go a long way towards

demonstrating HRs strategic value. If a direct link can be made between HRs effectiveness and areas such as customer retention or product quality, it is much easier for HR to demonstrate its strategic value. Some of the roundtable participants are working with their executives to do precisely this. Effective use of metrics is also a key aspect of corporate governance, which is today a fundamental part of management. As one roundtable participant mentioned, a fundamental requirement is to be able to justify the existence and value of HR, because HR is usually considered a cost centre. The HR function needs to more accurately measure what it does, but it also needs to provide a more definitive link to business outcomes, and to promote these metrics more effectively to the rest of the organisation.

Figure 5: Measuring the effectiveness of the HR function

Turnover / Retention Product or Service Quality External Customer Satisfaction Employee Satisfaction Employee Productivity Business Unit Satisfaction Other 21 23 0 20 40 60 80 100 36 42 52 73 93 88 85

73 75 70 77 63

Other Senior Executives HR Executives

Percentage of Respondents

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Key Finding 4
HR does not utilise technology as well as it could
Respondents were asked (HR executives only) which areas of their HR functions are IT-enabled. Payroll is the most common function (82 percent of respondents), with no other function being IT-enabled in more than half of all respondent organisations. The most common non-payroll functions that are IT-enabled are employee and manager self-service (43 percent of respondent organisations) and learning management (37 percent). Many organisations that have not implemented technologybased solutions for employee and management self-service and for learning management are planning to do so. This indicates some faith in the ability of technology to drive benefit in these areas. There is more limited use of technology in areas like talent and performance management, or in the use of business intelligence tools for HR purposes. In the roundtable discussions some HR executives stressed the desirability of having integrated IT systems. Others pointed out that the technology solutions they have implemented thus far have been in many cases disappointing and have not delivered functionally or financially. This can lead to a vicious circle, where limited funding leads to limited functionality, which in turn leads to limited satisfaction. Further, what benefits that have been derived from technology have often proved difficult to quantify. Respondents were asked whether they had measured the return on investment (ROI) of these IT systems. Fewer than half say that they have attempted to measure the ROI. Of those that have, there is little agreement as to the metrics employed. Measurement tools are usually mentioned as being derived from vaguely defined areas such as internal systems or IT. The research suggests that HR could be using technology much better and much more effectively. Use of technology is a key component of high performance HR, in which integrated systems are used across the organisation to drive efficiency.

Figure 6: How HR utilises technology

Payroll Employee and Manager Self-Service Learning Management Case Management of HR and Payroll Business Intelligence Talent Management System 0 25 23 18 20 Already have Examining business case 43 37 10 3 15 20 2 7 40 60 82 22 30 5 6 62 60 55 80 100 8 30 27 7 3

Plans to implement None

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Key Finding 5
HR has not fully considered the use of alternative sourcing options
Respondents were asked (HR executives only) whether various aspects of the HR function are currently outsourced. The most widely outsourced activity is training delivery, with 75 percent of organisations reporting at least some outsourcing in this area, and 40 percent reporting that all or most of it is outsourced. Other activities in which most organisations report some degree of outsourcing are content development for learning (65 percent with some, most or all outsourced), HR and payroll technology (50 percent with some, most or all outsourced), and learning technology (49 percent with some, most or all outsourced). The results indicate that HR outsourcing currently occurs mostly in the HR technology and training areas. Other administrative areas, such as the management of recruitment processes and training and performance management, are much more likely to be kept in-house. Respondents to the survey were also asked what they believe are the benefits of their current outsourcing arrangements. The most commonly mentioned benefit is the outsourcers ability to provide specific expertise (35 percent) followed by cost savings (mentioned by 31 percent of respondents). Other perceived benefits of outsourcing include giving one an ability to focus on the core business (17 percent), efficiency gains or time savings (15 percent), too expensive to do in-house (15 percent), giving one an ability to focus on strategic issues (12 percent), and the outsourcers ability to provide expertise in the areas of compliance and/or best practice (6 percent). It is important to remember that these perceived benefits of outsourcing are based largely on those activities that are currently outsourced essentially payroll technology and the various parts of the training activity. There is less interest, and by extension little perceived benefit, in outsourcing other parts of the HR process in the management or administrative areas. There was however recognition in the roundtables that outsourcing can also provide an ability to predict business results, and to support the strategic planning process.

Figure 7: HR activities currently outsourced

Training Delivery Content Development for Learning HR & Payroll Technology Learning Technology Recruiting Administration Training Administration Payroll and Benefits Services General HR Advisory (e.g. OH&S) Performance Management 0 20 40 25 35 50 51 59 70 73 71 90 60 80 35 32 18 24 30 18 17 27 33 23 16 20 7 10 16 5 8 3 12 2 8 2 8 2 100

None Most

Some All

Figure 8: Perceived benefits of outsourcing

Provide specific expertise Cost savings I can focus on core business Efficiency gains / time savings Too expensive in-house I can focus on strategic issues Compliance / best practice 0 6 5 10 15 20 25 30 35 12 17 15 15 31 35

Percentage of Respondents

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Conclusions
In the course of many years of research and consulting with hundreds of organisations around the globe, Accenture has identified a number of factors that characterise human performance leaders8 . Their key characteristic is that they have stronger overall financial performance than other organisations, and they are more likely to be planning to grow their organisation in the years ahead. High performing organisations exhibit specific characteristics in seven capability areas. Accentures research shows that the HR function can play a central role in developing and nurturing these capabilities. These areas are:

Human capital efficiency the ability of the organisation to efficiently and cost-effectively manage its human resources. Talent management the ability of an organisation to effectively acquire, develop and retain high performing individuals in critical jobs (for example research and development or sales). Leadership capability the ability of those who direct, plan and coordinate work within an organisation to effectively guide it in accomplishing its goals. Employee engagement the emotional involvement and commitment of individuals to their work and the organisation. Workforce adaptability the ability of the workforce to flexibly respond to changing business conditions. The ability to change measures the extent to which an organisation can effectively adapt to and manage internal and external changes such as mergers and acquisitions,
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downsizing, economic downturns and reorganisations, while minimising disruption. Workforce performance the ability of individuals to effectively apply their skills, knowledge, and abilities to accomplish the organisations goals. Using the context of the primary Australian research and the high performance characteristics Accenture believes it is possible to distil a series of practical steps every HR function should be examining in order to maximise their potential. This is a multi stage process:

transformation. Setting the strategic direction against the backdrop of these capabilities will ensure that managers recognise that HR is not merely a cost centre, but can be a genuine driver of business value.

Stage 2 Understand your Key Stakeholders

Understand who your key stakeholders are - and their expectations. There is a continuing dichotomy between how HR executives see the role of the HR function and the views of the rest of the business. This needs to be resolved through a thorough discussion and articulation of your HR strategy, anchored around the high performance capabilities outlined above.

Stage 1 Understand your Business Context

Understand the business context within which you are operating. Without this understanding it is not possible to credibly set the direction of the HR function. The context needs to be tested against plans developed to deliver each of the high performance capabilities outlined above. This context should then drive each step of any HR

Stage 3 Get your own House in Order

Demonstrate that you can get your own HR house in order. The HR function

must be able to deliver its hygiene requirements such as payroll and, reporting before it can effectively provide a platform for driving its involvement in other higher impact areas of business growth.

Stage 4 Transform the HR Function First

Transform your function first and implement your desired HR operating model. Transformation of HR delivery will provide the required time to focus on delivering against the high performing capability areas, and demonstrate to the business that the function has the required skill set to facilitate broader business improvements. HR needs to give further consideration to outsourcing higher level functions to aid in this process. There is a recognition within many organisations that outsourcing can deliver more than just cost reduction it can be a means of transformation in its own right and

a means to deliver significant business benefit as outsourcers move further up the HR activity value tree. HR also needs to ensure it is employing staff with the correct skill set. This skill set needs to move beyond the traditional HR toolkit and into areas such as project management, strategic planning and general business acumen.

also need to be in place to demonstrate the return on investment of any HR initiatives. Our research has shown that many organisations have not yet realised the full potential of the HR transformation journey. HR transformation is no longer a luxury, but a competitive necessity HR executives therefore have an essential role in the future success of their organisation.

Stage 5 Define the HR Role

Define and promote the role of HR. Once the strategic direction and context of what you are trying to achieve is set, you need to be explicit about the role of the HR function and how it can help drive that business performance.

Stage 6 Measure Efficiency and Effectiveness

Define how you are going to measure HR success. These metrics need to cover both efficiency and effectiveness, and demonstrate a clear link to organisational performance. Measures
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Notes

Benton, M. and Cantrell, S. Harnessing the Power of an Engaged Workforce, p.54, Outlook Journal. Accenture, February 2005. Davidson, G. and Deluca, M. HR Outsourcing That Delivers Improved Business Performance, p.74, People, Performance, Profit, Maximizing Return on Human Capital Investments, Montgomery Research Institute, 2005. Australian Bureau of Statistics, Yearbook Australia (1301.0), January 2006. OECD, OECD in Figures, 2005. Australian Bureau of Statistics, Labour Force, Australia (6202.0), February 2006. Brakeley, H., Cheese, P. and Clinton, D. The High-Performance Workforce Study. p5.Accenture, 2004. Brakeley, H., Cheese, P. and Clinton, D. The High-Performance Workforce Study. p5. Accenture, 2004. Brakeley, H., Cheese, P. and Clinton, D. The High-Performance Workforce Study. p11. Accenture, 2004.

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About the Authors

Catriona Brash
Catriona Brash is the Executive Partner in charge of Accentures Human Performance Service Line in Asia Pacific. Catriona has been with the firm for over 20 years and has worked with clients in Australia, New Zealand, Asia and the US in a variety of industries. The majority of her career has focused on helping clients address the organisational and workforce challenges of large scale change and business transformation.

Andrew Woolf

Andrew Woolf is a Senior Manager in Accentures Human Performance practice with responsibility for HR Transformation in Australia. Andrew has over 12 years experience in change management, in the implementation of HR shared services and HR outsourcing. He has worked extensively on HR transformation initiatives in Europe, the US and Asia Pacific - delivering HR solutions.

Further Information
Catriona Brash catriona.m.brash@accenture.com 03 9838 7000 Andrew Woolf andrew.woolf@accenture.com 03 9838 7000

For further information on this report or for a discussion on how Accenture can help you transform your HR function please contact:

Acknowledgements
We would also like to thank Richard Clarke, Managing Director for Accenture Learnings business in Australia; Michael Scott, General Manager for Accenture HR Services in Australia and Alexander Broeking, National Marketing Manager Accenture Australia for their contributions to this study.

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Accenture and High Performance HR

About the Human Performance Practice

The Accenture Human Performance practice helps its clients address their most critical people issues through innovative approaches in the areas of organisation strategy, human resources, learning, knowledge management, performance management and change management. With more than 5,500 skilled human performance professionals, Accenture offers a full range of consulting and outsourcing solutions to help clients improve the performance of their workforce and their business overall.

High Performance HR
Accenture has spent many years refining its High Performance HR model, flexibly tailoring components to reach organisations business needs. Additional insights are based on industry expertise and a deep understanding of how HR works with other critical business processes. Accenture has developed unique assets and proven tools to help organisations determine where to start and how to sustain HR transformation. That means knowing what skills are required, where to get them, how to engage the other parts of the business in the transformation, and how HR can best improve workforce performance as a result of its transformation. Accenture makes the art of managing and developing Human Capital into a science. There are substantial benefits: The clear definition of HR roles and responsibilities and associated performance measurement An ability to focus on providing specialist and strategic services

Access to meaningful management information from a single data source Increased workforce motivation through feeling part of an organisation and driving direct value creation Ensuring the HR organisation is cutting edge and an exciting place to work An enhanced ability to attract, grow and retain key talent HR being valued by the organisation as a major contributor and a respected profession.

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Accenture HR Services
Accenture HR Services provides a broad range of people management services to enterprises on an outsourced basis. Employing advanced technology and best-of-breed human resources practices, Accenture HR Services works in close collaboration with its clients to provide high touch services that meet the unique needs and characteristics of their business operations and people. In this way, Accenture HR Services enables organisations to unlock the value of HR, improving overall workforce cost and effectiveness. Accentures global coverage and experience servicing over 1,000,000 employees and pensioners in most of the worlds key markets enables clients to achieve the best total cost for their total HR solution.

Accenture Learning
One of the keys to the development of a high performance workforce is learning. Accenture Learning is one of the largest learning services providers in the world, delivering more than 14 million hours of training to over a million people a year, with a full range of learning services from content development to learning management. Accentures Brisbane Content Development Centre is one of five such centres in its global network. The Centres clients include the Australian Taxation Office, State and Federal government departments and financial institutions, both in Australia and overseas. The Centre develops content for systems implementations and outsourced learning applications. Accenture Learning works with organisations to establish a clear and continuing link between learning investments and business results. For organisations looking to rapidly transform their training capabilities, Accenture Learning offers a comprehensive learning outsourcing solution.

Enterprise learning is no longer a support function, but a critical lever for high performance. Accenture research has consistently shown that organisations that invest intelligently in people and learning processes have the most engaged workforces. Organisations that harness learning well have significantly higher employee engagement and retention than those that perform it poorly. Accenture Learning is uniquely positioned to help organisations convert their learning investments into high-performance business results. Useful links to other Accenture information: www.accenture.com/Global/Services/ By_Subject/Workforce_Performance/ default.htm www.accenture.com/Global/Services/ By_Subject/Human_Resources_Mgmt/ default.htm www.accenture.com/Global/Services/ By_Subject/Change_Mgmt/default.htm

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Copyright 2006 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

About Accenture
Accenture is a global management consulting, technology services and outsourcing company. Committed to delivering innovation, Accenture collaborates with its clients to help them become highperformance businesses and governments. With deep industry and business process expertise, broad global resources and a proven track record, Accenture can mobilise the right people, skills and technologies to help clients improve their performance. With more than 129,000 people in 48 countries, the company generated net revenues of US$15.55 billion for the fiscal year ended August 31, 2005. Its home page is www.accenture.com.