Uploaded byDeloitte Australia
Future of the Public Sector Workforce
The document discusses challenges facing the future public sector workforce in Australia. It notes the aging population and increasing urbanization. The priorities for the public sector are improving service delivery, innovation of products and services, and workforce and talent development. This will require strengthening leadership, increasing productivity and performance, and developing a more agile workforce. Changes like consolidation, increased use of technology, and outsourcing some services will impact the workforce. Regional economies rely on public sector jobs so changes may affect them. Overall the public sector must invest in leadership, performance management, and increasing workforce flexibility and agility.
More Related Content
Similar to Future of the Public Sector Workforce
Future of the Public Sector Workforce
- 1. The Public SectorWorkforce of the Future Rory Gregg, Partner – Operational Advisory Grant Thornton Australia #cpa2013 @rory_gregg www.rorygregg.com
- 2. Agenda • The demographic challenge • Public sector priorities • What needs to be done • Questions © Grant Thornton International. All rights reserved.
- 3. Agenda • The demographic challenge • Public sector priorities • What needs to be done • Questions © Grant Thornton International. All rights reserved.
- 4. The Demographic Challenge Thetyranny of distance © Grant Thornton International. All rights reserved. Source: Australian Bureau of Statistcs
- 5. The Demographic Challenge Whereis Australia headed 35.5m people by 2056 64% live in capital cities today © Grant Thornton International. All rights reserved. Source: Australian Bureau Statistics, Population Projections 2006-2101.
- 6. The Demographic Challenge Whatabout Queensland? 23% Population growth 2001 to 2011 36.6 Median age in QLD © Grant Thornton International. All rights reserved. Source: Australian Bureau Statistics, Population by Age and Sex, 2011.
- 7. The Demographic Challenge Whatabout Queensland? 13% are over 65 QLD Hotspots Bribie Island Sunshine coast Gold Coast © Grant Thornton International. All rights reserved. Source: Australian Bureau Statistics, Population by Age and Sex, 2011.
- 8. Agenda • The demographic challenge • Public sector priorities • What needs to be done • Questions © Grant Thornton International. All rights reserved.
- 9. Public Sector Priorities ServiceDeliver – Product & Services – Workforce & Talent Leadership Productivity Performance Agility Service Workforce & Delivery Talent Innovation Innovation Consolidation Workforce Impact Self Service Customer Centricity Barriers Technology Data & Insights Product & Decentralisation Service Outsourcing Innovation © Grant Thornton International. All rights reserved.
- 10. Public Sector Priorities ServiceDeliver & Product & Services Leadership Productivity Performance Agility Service Workforce & Delivery Talent Innovation Innovation Consolidation Workforce Impact Self Service Customer Centricity Barriers Technology Data & Insights Product & Decentralisation Service Outsourcing Innovation © Grant Thornton International. All rights reserved.
- 11. Public Sector ServiceDelivery What do politicians expect? Consolidation Shared services models Standardisation Economies of scale Smaller workforce More for less © Grant Thornton International. All rights reserved.
- 12. Public Sector ServiceDelivery What do the public ask for? Convenience Easy access to services Human help when they need it Resolve issues first time Source: NSW Government , Voice of Customer Research 2012 © Grant Thornton International. All rights reserved.
- 13. Customer Service Major trendsin the private sector Self service Smartphones and Tablets E-commerce Multi-channel Kiosks Showrooming Image: Forbes © Grant Thornton International. All rights reserved.
- 14. Customer Service Major trendsin the private sector Breaking Down Barriers Concierge style services Personal account managers Building personal connections Future concept for retail banking – Deutsche Bank Retail Banking 2013 Commonwealth Bank, Deutsche Bank © Grant Thornton International. All rights reserved.
- 15. Impacts on CustomerService Avoiding the pitfalls Big Data Are you measuring the right things? Measurement costs? Impact on customers? Workflow changes? Will prices need to increase? © Grant Thornton International. All rights reserved.
- 16. Turning Data Insightsinto Innovation The Big Data conceptual model Find the evidence "Product & Build a hypothesis Service Experiment with clients Innovation" Measure A huge structural leap for most workflows and organisations Continuous Iterative Change © Grant Thornton International. All rights reserved.
- 17. Public Sector Priorities Product& Services & Workforce & Talent Leadership Productivity Performance Agility Service Workforce & Delivery Talent Innovation Innovation Consolidation Workforce Impact Self Service Customer Centricity Barriers Technology Data & Insights Product & Decentralisation Service Outsourcing Innovation © Grant Thornton International. All rights reserved.
- 18. Workforce Impacts Significant organisationalchange Continuous Change KPIs Training Instability Engagement More or less autonomy? Amazon has stable logistics processes Innovation occurs mostly via website © Grant Thornton International. All rights reserved.
- 19. Customer Centricity -Regional Areas Impacts and Opportunities High speed Internet Reduced travel Rapid access to expertise Multi-channel delivery Different skill mix on ground Decentralised models become much more efficient Distance learning and telemedicine © Grant Thornton International. All rights reserved.
- 20. Economic Impact ofService Changes Public sector jobs critical to regional economies 8% 13%or more are over 65 workforce QLD Hotspots Bribie Island Industry = Sunshine coast Public admin or safety Gold Coast © Grant Thornton International. All rights reserved. Source: QLD Office of Economic and Statistical Research, 2011.
- 21. Economic Impact ofService Changes Public sector jobs critical to regional economies 13% 7% or more are over 65 workforce QLD Hotspots Bribie Island = education Industry Sunshine coast Gold Coast © Grant Thornton International. All rights reserved. Source: QLD Office of Economic and Statistical Research, 2011.
- 22. Private Sector Delivery Opportunitiesand threats Outsourcing Flexibility Economies of scale Scope uncertainty Cost measurement and management Risk management Supplier default/insolvency Source: Sydney Morning Herald, Reed Construction Hastie Group collapse impacted Gold Source: News Ltd, Collapse impacted NSW Transport, 2012 Coast Hospital, 2012 © Grant Thornton International. All rights reserved.
- 23. Public Sector Priorities ServiceDeliver & Workforce & Talent Leadership Productivity Performance Agility Service Workforce & Delivery Talent Innovation Innovation Consolidation Workforce Impact Self Service Customer Centricity Barriers Technology Data & Insights Product & Decentralisation Service Outsourcing Innovation © Grant Thornton International. All rights reserved.
- 24. Public Sector Workforce Futureworkforce priorities Strengthening public sector leadership Addressing declining productivity Wages are just one component of the Performance productivity challenge management priorities Investing in building an agile and engaged workforce © Grant Thornton International. All rights reserved.
- 25. Public Sector Workforce StrengtheningPublic Sector Leadership • Leadership Behaviours • Remuneration Flexibility • Developing Leaders © Grant Thornton International. All rights reserved.
- 26. Public Sector Workforce Addressingdeclining productivity Address workforce mobility and agility to unlock productivity gains Foster innovation and collaboration across Agencies to fill productivity gaps What gets measured gets managed © Grant Thornton International. All rights reserved.
- 27. Public Sector Workforce Performancemanagement priorities Engage employees through regular formal and informal feedback processes Empower leaders with tools that differentiate performance and rewards © Grant Thornton International. All rights reserved.
- 28. Public Sector Workforce Buildingan agile and engaged workforce Increase flexibility of systems to allow development of agile workforce Engage employees through regular formal and informal feedback processes Strengthen the links between agency succession planning and individual career planning © Grant Thornton International. All rights reserved.
- 29. Agenda • The demographic challenge • Public sector priorities • What needs to be done • Questions © Grant Thornton International. All rights reserved.
- 30. What needs tobe done Investing in leadership, frameworks to reward and foster desired leadership behaviours Strengthen performance management Review the rigid job classification and grading scheme to allow for greater workforce agility © Grant Thornton International. All rights reserved.
- 31. Q&A Rory Gregg Partner – Operational Advisory T +61 2 8297 2531 E rory.gregg@au.gt.com #cpa2013 @rory_gregg www.rorygregg.com © Grant Thornton International. All rights reserved.
- 32. Acknowledgements “Australian Key InnovationIndicators Data Card“, Australian Department of Industry and Innovation (Nov 2012). QLD Office of Economic and Statistical Research, 2011. Maps of QLD employment by industry. Sydney Morning Herald, Reed Construction Collapse, 2012 News Ltd, Hastie Group collapse impacted Gold Coast Hospital, 2012 Australian Bureau Statistics, Population by Age and Sex, 2011. © Grant Thornton International. All rights reserved.
Editor's Notes
- #2 Good AfternoonBy way of introduction my name is Rory Gregg, I'm a Partner within the Business Consulting Practice for Grant Thornton and am based in Sydney.GT is a global Professionals Services firm that specialises in providing our clients with a broad range of Assurance, Tax and Advisory ServicesMore often than not we find ourselves working closely with the Board, the CEO and his or her executive leadership team to identify and overcome a broad range of complex problems they may face in running their businesses.In Australia we have over 120 partners and 1,500 staff locates in all major capital cities.We work with a wide range of public and privately held companies, as well as government departments and entities across the country. Today I wanted to talk to you about the workforce challenges and opportunities facing leaders in the public sector.
- #3 AGENDAMany of the areas I will cover are relevant to governments across the country, but today I will drill down to several specific challenges that will require special attention in QueenslandFirst of all I will cover the challenges created by the changing face of Australia. Who we are, and where we live.After this, I will outlying the broader Public Sector priorities that we believe need to be considered in building the WF of the futureWhat needs to be doneQuestions
- #4 AGENDAMany of the areas I will cover are relevant to governments across the country, but today I will drill down to several specific challenges that will require special attention in QueenslandFirst of all I will cover the challenges created by the changing face of Australia. Who we are, and where we live.After this, I will outlying the broader Public Sector priorities that we believe need to be considered in building the WF of the futureWhat needs to be doneQuestions
- #5 In Australia, I think it is safe to say we all expect a lot from governments. We expect our children to have access to a good quality education, low cost access to medical services, and help when floods or fires affect our communities.By and large, we expect to pay taxes, elect politicians, and abide by the laws of the day. In return we expect governments to deliver the services we want.So why am I showing you a map of Australia? Because government services need to be delivered to communities, and people don’t always choose to live in places that are cheap and easy to service.Put bluntly, Australia is incredibly huge, and has only a tiny population. Population distribution and density clearly have a huge impact on the cost and efficiency of government service delivery.The tyranny of distance is an old concept, so old that many Australian’s seem to ignore it, and take it for granted.This map illustrates a fundamental challenge facing governments in Australia. The yellow and pale orange colours signifies the lowest population density areas. In those areas you could theoretically fly anywhere in one direction for one thousand kilometres and see fewer than 100 homes. These areas of incredibly low population cover huge portions of Queensland, the Northern Territory, Western Australia and South Australia.Fortunately, telecommunications and Internet technologies are now helping to solve some distance related challenges, but many issues still remain.
- #6 So where is Australia heading. To understand the scale of demand for government services in the future, we need to understand possible scenarios for community growth and composition.The Australian Bureau of Statistics has done quite detailed projections for Australia’s population growth, and how it sees our future.Perhaps the most important things to emphasise are things we tend to take for granted. 64% of our entire population live in the state capital cities, and that proportion has been roughly stable since 1976.The population projections put together by the ABS show an expanding population which is aging rapidly. The fastest growing age group is people over 85 years of age. The projections are based on assumptions of significant immigration and birth rates. Life expectancy is the reason things are shifting dramatically, with life expectancy projected to be 85 years for men and 88 years for women by 2056.So without a massive increase in immigration levels, our available workforce will shrink significantly, and the elderly will grow to become a very large portion of the population. A population scenario similar to that already encountered by Japan. In case you were wondering, over the last 20 years, Australia's working age population of15-64 year olds has been stable at roughly 67.0% of the total population. These demographic impacts will start to slowly bite into our available workforce over the next few years. Considering we are already at full employment in many parts of the country, this increases the chances we will face workforce shortages over long periods.
- #7 Queensland is of course not immune to the demographic challenges. The median age in QLD has been rising in recent years, and is now 36.6 years. To put that into context, NSW has a median age of 37.7 years, and agribusiness dominated Tasmania now has the highest median age of 40.4 years.Population mobility is also significant in Queensland, and reflects younger people relocating to find work and education opportunities. As you can see in the graph, the greater Brisbane area is significantly younger than the rest of the state. It is also worth considering that QLD has for many years benefitted significantly from net migration from other states, and that the bulk of those interstate migrants have been settling in the South East.
- #8 Looking at the wider statewide picture, over 65s currently tend to cluster in regional areas a short distance from major metro centres. Agricultural areas also tend to have high proportions of elderly residents.This is similar to trends in New South Wales and Victoria, where inner city metro areas typically have very high concentrations of 20 to 30 year olds. The most marked difference for Queensland demographics is also a potential opportunity. Elderly residents are clustered heavily in the South East. This presents significant opportunities for achieving economies of scale in delivering services to the elderly. In comparison, states like NSW and Victoria have clusters of the elderly spread across widely separated regions.
- #9 AGENDAMany of the areas I will cover are relevant to governments across the country, but today I will drill down to several specific challenges that will require special attention in QueenslandFirst of all I will cover the challenges created by the changing face of Australia. Who we are, and where we live.After this, I will outlying the broader Public Sector priorities that we believe need to be considered in building the WF of the futureWhat needs to be doneQuestions
- #10 We believe that the Public Sector in Australian faces three critical challenges / Priorities these include: The need to invest in identifying and building alternative Service Delivery channels that can respond to the changing demands of customers whilst continuing to deliver services efficiently and effectivelyThe need to invest in ensuring that the products and services provided by the Pubic Sector remain relevant and appropriate and can be revised and changed in such a way that does not require wholesale change and disruptions to the fundamentals of delivering public servicesThe need to invest in rebuilding the Public Sector Workforce & Talent pipeline to ensure that product and services and service delivery aspect are constantly tested and reassessed
- #16 The surge in Big Data over past decade has highlighted a number of vexing questions that business leaders will need to consider. 1) Can insights be determined usefully from existing data, or will new measurements need to be collected. What is the size of the investment and how long will it take.2) Will the new measurements be intrusive, slow down staff, or impact the customer in any way?3) Will customers feel you are being creepy by asking too much detail?4) How much will the big data initiative add to your cost of sale?These and many other questions are beginning to fundamentally change the way business leaders think about how they manage and lead - and more particularly how they use the information they gather to redesign new products and services as well as how those services are delivered through new channels and mediums.
- #17 Big data is a rather widely used buzzword at the moment, but it is still worth understanding the fundamental concepts as they apply to innovation and the public sector. In the past, projects were planned linearly, with a rigid execution to predetermined goals. You build a plan, a budget, manage the execution of the project, and progress (or not) to a well understood set of goals. When you achieved the goals, that was it.Conceptually, to successfully use big data processes you need to reorganise workflows to take advantage of repeated experimentation. It is quite a radical concept for many large organisations, and is still rarely used outside tiny pockets of workflow. The style of leadership needed to manage these iterative and more uncertain situations is quite different to regimented project planning. For a start, leaders need to be willing to accept changes which are shown to be effective, and quickly recover or iterate when failures occur.This model is quite challenging to most large corporate enterprises, and is likely to be very difficult to implement on a large scale within the public sector. I am sure many of you realise just how difficult experimentation can be within government agencies. It can easily be stymied by over-prescriptive policy and legislation.
- #19 When you roll out a new initiatives, how will it impact your existing workforce.How will workforce KPIs need to change. If workflows are shifting regularly, will KPIs need to be adjusted each time?How will you deploy training across the workforce when changes are happening frequently?Will produce and service experimentation mean more rigid workflows, with computer control and less autonomy for employees? How will this affect human contributions to innovation when technology based experimentation is the fundamental model. Amazon has shown one possible path, with their supply chain processes based on highly mechanised stable systems, with experimentation focused on customer interactions.
- #25 Strengthening public sector leadershipAddressing declining productivityPerformance management prioritiesInvesting in building an agile and engaged workforce
- #26 Strengthening Leadership CapabilityLeadership and the capacity to manage change in a large organisation is the most undervalued and least nurtured skill in the public sector. This is especially true when the focus is on middle management, and capacity in workforce planning and management. The release in November 2012 of the NSW Public Sector Commission’s (NSW PSC) report into the State of NSW’s public sector workforce titled “How It Is” is unequivocal in its focus on the requirement to strengthen links between leadership, performance and leading change. In his summary, Commissioner Graeme Head, highlighted that strengthening areas for development in leaders will help in “attracting and retaining people, and [is] critical in driving innovative service delivery reform”1. Head argues that, all Westminster style public sectors are realising that the skillsets required for successful public sector leaders are deeper than ever before and there are currently significant skill gaps. Government agencies need to address this issue and build a targeted approach to leadership development so that a resource pool of capable leaders is available and ready. There has been under-investment in leadership development within the Australian Public Sector over the past 15 to 20 years and the capability gaps are becoming pronounced. Effort is required to turn this investment around and implement leadership programs. Development of a shared understanding of what leadership behaviours are required in the public serviceEstablish greater flexibility in remuneration to enable the attraction, retention and rewarding of outstanding leadership Focus on the development of leaders through:mentoring programs both within and across sectorsestablishment of secondment schemes across sectorsearly identification and investment in potential leaders
- #27 Addressing Declining ProductivityDecreasing productivity continues to restrain growth across Australia, and the public sector is not immune. While growth in Australia was largely shielded from the GFC by the resources boom, in a climate of scarcer resources, decreasing productivity is a major risk to the public sector achieving their objectives in service delivery improvement.Australia’s productivity rate has declined from 3.3% in the 1990’s to 1.2% in 2013 and the trend is continuing.2 The public sector must expand its reforms to address productivity beyond the traditional cost reduction reforms that produce only temporary results and at grassroots are destabilising to productivity. There are significant opportunities within the public sector to deliver incremental productivity improvements through leveraging existing workforce capability. Sustained investment and adoption of new innovative work practices, such as collaborative partnerships with other organisations, will help produce productivity improvements. It is important to note that workforce productivity requires relevant and useable measurements. In the public sector these must account for the complex relationship between workforce, service delivery, costs and revenues
- #28 Strengthening performance management and accountabilitiesPerformance management is a weak point within the Public Sector and therefore there are some major gains to be made that will help improve organisational performance. This is reflected in the NSW PSC study that revealed less than half of public service employees had participated in a formal performance appraisal process.The best description for the current Public Sector approach to performance management is inconsistent. The adoption of a standard approach will not only help organisations be answerable to strategic goals, but also allow management to address any gaps at regular intervals. The other advantages are that a unified framework will help to build training plans, to identify talent early, and to develop succession planning programs across the sector. Implementing such a significant change to a sector will not be easy and should be managed carefully, if not, in strategic stages. According to a recent study undertaken by Grant Thornton International, Bracing for Change: Chief human resources officers rethink business as usual, the barriers to be managed are: Constraints on a manager’s ability to adequately recognise and reward high performers; A heavily regimented job classification and grading system; and Limits to the ways leaders can discipline poor performers. There is work being undertaken to review performance management in all states with the aim of moving to a state-wide approach. Any new approach needs to consider ways of addressing the challenges listed above. For example, rewards can be broadened beyond monetary types to include other forms of recognition, engagement and incentives. Developing a rewards program does not need to be cost prohibitive and can
- #29 Build an Agile & Engaged workforceGrant Thornton has recently being working with a large government department on a major organisational restructure and one of the key learnings is that there is significant work required on workforce agility. The current HR systems are too rigid and confine employees to inflexible job descriptions and this is having a direct impact inhibiting the development of an agile workforce that can absorb work change.An agile workforce is made up of individuals who have broad skill sets who have the capacity to work across a diverse range of areas. Interestingly, in 2012, only 0.47% of the NSW public sector workforce moved between roles or Departments/Agencies, which reflects a very low mobility and capacity to transfer skills across departments and jobs. Moving forward, this statistic will be a good indicator of improvements in the public sectors workforce agility.Our work helping the government agency with it’s organisational restructure, extended to help improve core HR systems and processes. In this example, the objective was to enable their employees (engineers in this case) to be more reactive, empowered and collaborative – they wanted a workforce that was agile. Unfortunately their embedded systems were quite rigid and impacted how employees worked. For instance staff were required to be linked to a specific job description before being able to undertake any new roles and responsibilities. In an environment where there was considerable change this system was not delivering to the business requirements. It required a system that was flexible and could manage change effectively. This is a good example where technology and systems were managing business imperatives – not the other way around.Workforce agility goes further than the systems and other elements of the operating model must be improved. Recruitment processes need to be changed to seek out employees with broad skill sets. Recruiting these types of people will inherently require that rigid position descriptions are discarded for more flexible and adaptable roles and responsibilities.Public sector position descriptions are becoming so detailed and over-worded that they are not understood by external applicants or are overwhelming internal applicants. This makes it even more difficult to compete with the private sector for the best candidates. Coming back to our client… one of the solutions to developing an agile workforce was to hire engineers at a grade level, but not place them within specific positions. This means that they are used as a resource pool that may be involved in infrastructure construction one week and then site inspections the next. It is similar to a professional services approach to service delivery and provides resourcing flexibility and improved productivity to the department. As discussed earlier succession planning is a valuable strategy to pursue. As Agencies can no longer rely on skill hire employees to fill gaps, it means strategic workforce planning is required to balance strong internal succession planning with attracting external talent. Robust succession planning helps to support a strong talent pipeline, but in our experience can bring even greater value to an organisation as it looks to foster key attributes in staff. Taking a private sector approach to workforce agility and succession planning will achieve much needed results. This can be achieved through good change management and does not need to challenge any industrial relations agreements.
- #30 AGENDAMany of the areas I will cover are relevant to governments across the country, but today I will drill down to several specific challenges that will require special attention in QueenslandFirst of all I will cover the challenges created by the changing face of Australia. Who we are, and where we live.After this, I will outlying the broader Public Sector priorities that we believe need to be considered in building the WF of the futureWhat needs to be doneQuestions
- #31 What needs to be DoneIt is vital that the Public Sector focuses on developing leadership bench strength, addressing worrying productivity trends, reviewing the approach to performance management and fostering an agile workforce.Given the uncertain environment, these priorities will support agencies capacity to respond quickly to change and enable them to manage associated anxiety and stress at an individual level as well as significant disruption at the organisational level. The Public Sector needs to instil long-term sustainability as the priority outcome of the current reforms; otherwise the risk of change fatigue and considerable service delivery disruptions will be very real. There are a number of actions Public Sector organisations can implement to secure the future and instil long-term sustainability, however the key priorities include: Investing in leadership, including the development of frameworks to reward and foster desired leadership behaviours Strengthen performance management within the sector through feedback and mechanisms to reward good performers Review the rigid job classification and grading scheme to allow for greater workforce agility These actions differ in complexity and/or relevant for each organisations environment. It is recommended that agencies use a portfolio management approach and prioritise the actions to be achieved.