report 070707 summary

R

Workplace RetentionMake it work for you

Summary Report

Project Director:Jason DunstoneManaging DirectorProject Manager:Rikki-Lee Schmitt+61 [0]8 8232 3355Data collected:July - September 2007

For the full report visit www.sagreat.com.au or www.aimsa.com.au or contact Square Holes Pty Ltd

Square Holes Pty Ltd8-10 Regent Street NorthAdelaide South Australia 5000www.squareholes.com

Overview ................................................................................1

Conclusions ............................................................................2

Aspects impacting job satisfaction ............................................. 3

Aspects impacting job loyalty.................................................... 4

Top 10 retention strategies....................................................... 5

Lower priority retention strategies............................................. 6

Employers of choice................................................................. 6

Other key findings ................................................................... 7

What are the key messages to South Australian employers?........ 7

Appendices .............................................................................8

Top 20 Retention Strategies by Industry .................................... 9

About Square Holes ............................................................... 12

This report is provided for information purposes only. Except to the extent permitted by law, no part of this report may be reproduced, published, adapted, distributed, stored in a retrieval system, transmitted or communicated for any commercial purpose (including education or training) without the prior written approval of Square Holes Pty Ltd. Any reference to the research findings contained in this report should state 'Source: report on Workplace Retention (2007) by Squares Holes Pty Ltd, SA Great and Australian Institute of Management SA' [Report SA Great summary]

intelligence

knowledgebut

The true sign of

isnot

Albert Einstein

1

Overview Now more than ever, employee retention in the workplace is a hot topic.

There is little if any current research available about what South

Australian employers can do to retain and entice good staff. While some

research has been conducted previously about the needs of younger

South Australian professionals, the focus has been on social and economic

issues such as ‘affordable living’ and a ‘good place to raise a family’.

The current research by Square Holes working with SA Great and the

Australian Institute of Management [AIM] seeks deeper insight and

valuable actionable directions for employers.

The workplace retention research project commenced with a series of

targeted focus groups, held to allow some initial brainstorming of the

topic amongst young people representing professional services, science

and technology and trades. These were moderated at Square Holes’

Adelaide CBD research facility by Rikki-Lee Schmitt with the support of

Jason Dunstone. The focus groups provided valuable guidance for the

survey questionnaire development.

The second stage of the project was an internet survey of 800 South

Australian employees aged under 40. This included 181 expatriate South

Australians currently working interstate or overseas. The survey was open

to all levels of an organisation, ranging from administration to upper

management. It attracted open and honest feedback from a wide

selection of younger people.

SA Great, AIM and Square Holes are thrilled with the response the survey

generated, and are appreciative of the enthusiastic support. Those

involved in the research were invited to attend a cocktail function on the

15th of October 2007 to hear the preliminary findings first hand and to

offer additional feedback.

The results of the survey were presented at a business luncheon on the

31st of October 2007 at the Hyatt Regency Ballroom in Adelaide. The

event also involved a panel discussion facilitated by Phil Speakman,

Chairman Morton Phillips, and included:

Joanne Fox, Manager, People & Performance, Santos Ltd

John Chaplin, Director, Fusion

Peter de Cure, People, Performance & Culture Executive Partner, KPMG

Jason Dunstone, Managing Director, Square Holes Pty Ltd

Copyright 2007 Australia Square Holes Pty Ltd, SA Great and Australian Institute of Management SA

2

ConclusionsSouth Australian Generation X and Y employees generally admit to being

satisfied with their employment – 86%. Some of the aspects they like

include the responsibility and challenge they are given, autonomy and

flexibility. Employees aged 18 to 24 have the highest job satisfaction.

OVERALL JOB SATISFACTION

2%13% 17%

68%

Extremely satisfied Quite satisfied Quite dissatisfied Extremely dissatisfied

When the issue is explored more deeply, it is evident that younger

employees are by no means locked into their current jobs. Only 17% are

extremely satisfied with their job. Furthermore, while 48% believe it is

extremely likely that they will be with the same employer in one year, this

level decreases to 25% in two years and 14% in three years. Only 6% are

extremely satisfied with their job and extremely likely to be with the same

employer in three years.

Only 1 in 20 employees aged

under 40 are extremely satisfied and

extremely likely to be working for

the same employer in three years

The key reasons a change of job may be on the horizon include the

search for ‘career progression and more challenge and responsibility’

and/or employers offering better direction in achieving this. Complaints

about current employers included a lack of career progression and

responsibility and poor management.


3

Aspects impacting job satisfaction

The focus group stage of the research revealed seven areas as

fundamental in job satisfaction …

pay and salary package;

training and development;

responsibility and challenge;

employer image;

work-life balance;

management culture; and

work environment.

These areas formed the basis of the online survey questionnaire designed

by Square Holes in collaboration with SA Great and the Australian

Institute of Management [AIM]. The questionnaire explored satisfaction,

loyalty, issues relating to each of the seven fundamental areas and other

associated questions. One of the priorities of the survey analysis was to

illustrate the impact each of the seven areas has on overall job

satisfaction and loyalty [i.e. likelihood of being in same job in 3 years].

As indicated by the Job Satisfaction Impact Scoreboard to the right

‘management culture’ and ‘responsibility & challenge’ have the greatest

impact on overall job satisfaction, closely followed by ‘work environment’.

It is interesting that ‘pay and salary package’ has a relatively low impact

on overall job satisfaction. Also of interest is the comparatively low level

of satisfaction with the management culture of current employers.

Job Satisfaction Impact Scoreboard

NB: Size of squares and pie graphs indicate level of correlation with overall job satisfaction

Management Culture

Salary Package

Work-Life Balance

Training & Development

Responsibility & Challenge

Company Image

Work Environment

Satisfied with current employer in key areas

NB: Percentages indicate the actual level of satisfaction with the different areas

Management Culture

66%


78%

Company Image

83%81%

Salary Package

Work EnvironmentTraining & Development

82%

74%Work-Life Balance

81%


4

The research illustrates that satisfaction is a combination of satisfaction

with a variety of aspects of a younger employee’s job, yet some aspects

have a greater impact. A 100% improvement in satisfaction with the

management culture of an employer will, based on the survey data, result

in a 48% increase in overall job satisfaction. In comparison, a 100%

improvement in the pay and salary package will only increase overall job

satisfaction by 30%. This may be logical, yet clearly illustrates that you

cannot increase a disgruntled employee’s job satisfaction by improving

their pay in isolation.

Aspects impacting job loyalty

Further evidence of how difficult it is to retain good younger staff is in the

survey finding that there is not a direct correlation between overall job

satisfaction and staff loyalty [i.e. likely to be with the same employer in

three years]. It is vital that employers are strategic and invest

appropriately to minimise employee resignations and churn, and maximise

staff focus on medium to longer term objectives.

A 100% increase in overall job

satisfaction will increase staff loyalty

by only 27%.

The importance of a robust ‘management culture’ once again surfaces

when we analyse the impact of the seven key aspects of job satisfaction

on staff loyalty [i.e. likely to be with the same employer in three years].

Based on the survey data, a 100% improvement in satisfaction with an

employer’s management culture will increase staff loyalty by 27%.

‘Company image’, ‘work environment’ and ‘training and development’

have the next greatest impacts on loyalty. Interestingly, based on the

survey data, a 100% increase in the pay and salary package of an

employee will only increase loyalty by 19%.

Job Loyalty Impact Scoreboard Management Culture

Salary Package

Work-Life Balance



Company Image

Work Environment

NB: Size of squares and completeness of pie graphs indicate level of correlation with

likelihood of being with current employer in three years


5

Some other interesting findings illustrate that pay and salary package,

while important, has limited impact on retention. This includes a smaller

proportion of younger employees believing that their pay is below the

industry average [24%], compared with the six other areas of job

satisfaction. There are clearly other areas of job satisfaction with greater

need of strategic focus and consideration by South Australian employers.

Employer Performing Below Industry Average

Top 10 retention strategies

Throughout the survey the younger employees were asked to indicate

from extensive lists under each of the seven areas of job satisfaction

which of these their current employers offer them and which would assist

with retaining them in their current job or attract them to another

employer.

When we look at the 6% of younger people interviewed who are

extremely satisfied and extremely likely to be with the same employer in

three years some interesting messages emerge for employers. Aspects of

their pay and salary package differ little from other less satisfied and loyal

younger employees. They are satisfied because their employers have

management who place trust and respect in their employees’ abilities and

encourage team work and creativity. Company reputation is important

and the employers are contributors to the community. A comfortable,

casual and friendly work environment is also fundamental.

35%

Management Culture

24%

Salary Package

44%

Work-Life Balance

34%


42%


55%

Company Image

47%

Work Environment

The top 10 aspects of younger employees nominated would encourage

them to stay with an employer or move to another revolve mainly around

management culture, responsibility and challenge and work environment.

A clear career direction and pathway is important, as is intelligent,

innovative, trustworthy and respected management. Also the way staff

are treated is essential to business success.

1. a management style that you respect 73%

2. future opportunity for advancement and more responsibility 70%

3. reward you for successfully completing complex tasks 68%

4. places its employees needs as essential to business success 68%

5. a casual and friendly work environment 68%

6. has a reasonable view of hours worked in an average week 67%

7. forward thinking and innovative management 67%

8. well respected and intelligent management 66%

9. trustworthy management 65%

10. allows working from home 65%


6

Lower priority retention strategies

It is important to stress that none of the list of aspects relating to pay or

salary package featured in the top 10 factors that would attract or retain

younger employees. This is unlikely to infer that pay and salary package

are not important in job satisfaction and retention, but it does indicate

that unless issues such as management culture and career progression

are addressed adequately there is no point focusing on financial

enticements.

Evidence of this is also provided when we present the bottom ten aspects

that would encourage younger people to stay with an employer or move

to another. There is a high prominence of aspects relating to pay and

salary package. These may be desirable, but less likely to retain or attract

staff than the earlier mentioned factors.

gift vouchers 11%

job share 14%

reimbursement expense account 16%

blackberry paid by employer 16%

school fee subsidy 17%

discount programs 18%

relocation allowance 18%

company paid credit card 19%

working outside 20%

equity or shares in the business 20%

Employers of choice

When asked for suggestions for employers of choice, those involved

nominated employers based on a belief that these organisations

encourage creativity, treat staff with respect, recognise and reward

performance, and offer career progression. A national or even global

focus is desired - i.e. not SA centric.

“They provide their employees with

flexibility, a great work environment

that encourages creativity and

development” [referring to Google]

Google attracted the highest level of nominations [36 of the 800 people

surveyed]. They were believed to be an employer offering a creative

environment encouraging innovation and forward thinking among

employees. Google is considered to treat staff as assets and in turn

creates an efficient, productive and dynamic team.

The only other employers named by ten or more of the younger

employees involved were BHP Billiton [18], Virgin [13] and Macquarie

Bank [12].


7

Other key findings

Half [49%] of the younger people surveyed had previously worked outside of South Australia - 26% interstate and 23% overseas - for an average of two years.

Prominent reasons for working in SA include study/education access and enjoying the arts/festivals/events. Family and friends living in South Australia is also important as is the easy lifestyle offered in this "good size city".

Of the 800 people interviewed, 181 are expatriate South Australians currently working interstate [91%] or overseas [9%]. They have been doing so for an average of 4.5 years.

The main reason for the expatriates working outside of the State is for better

career opportunity and progression than they believe is possible in South Australia. In saying this, there is typically openness to considering working in SA in the future. Greater opportunity for career advancement than perceived to currently exist, being less SA-centric, illustrating strong industry growth and being an employer of choice is important. There was also a view that South Australian management are overly restrictive and conservative in offering senior and quality jobs to younger employees. The expatriates were on a higher pay level than local employees, but often less satisfied in their current jobs that their South Australian based colleagues.

One in five of the people interviewed have children [21%], with this level only

10% for expatriates. The parents are seeking a reasonable view of hours worked in an average week from employers [75%]; a supportive policy for time off for sick children [70%]; a family friendly policy [69%]; ability to work from home [69%]; and flexibility in hours to fit with picking up/dropping off children [68%].

There were some differences when we compare different age groups,

expatriates and other segments of the survey sample, yet these were typically minor.

What are the key messages to South Australian employers? Management culture is the area of greatest weakness yet it has the

strongest impact on overall job satisfaction and retention. Generation X and Y employees are demanding a management style that they respect and managers who work with staff in a friendly manner. It is also important that management treat staff as individuals and place employees' needs as essential to business success.

Younger South Australian employees and expatriate South Australians

working elsewhere believe that management needs to take a long hard look at themselves and take more responsibility in attracting and retain the best. Attempting to shift the blame is viewed as unacceptable.

Disputing the myth that the new generation of employees are about ‘I want it now’, this research illustrates intelligent and ambitious hard workers. They are prepared to wait for financial and other rewards of success, yet are highly confident and will leave employers unwilling to nurture and provide future opportunity for advancement and more responsibility. A career pathway is essential.

Adequate investment in retaining quality younger employees is important. They demand proper selection and training of management, workplace design that encourages productivity and creativity, career training and development and other support. It's not just a job or about the money. Only one in twenty are extremely satisfied and extremely likely to be with the same employer in three years. With job satisfaction not directly linked with loyalty, the strategic focus should be on minimising the churn.

Strategic focus on the employer's company image is important. While this did not emerge as one of the top areas impacting job satisfaction, it did have the second largest impact on staff loyalty [following management culture]. It is also the area in which the largest proportion believes their employer is below the industry average [55% believed this]. This should include ensuring the vision/mission engages younger staff, contributing to the community and being a visible and well know employer.


Appendices

9

Top 20 Retention Strategies by Industry Of the 104 specific aspects of job satisfaction investigated in the survey, the following were nominated as the Top 20 likely to retain younger employees with their current

employer or attract them to another. Comparisons are made across various subgroups, such as expatriates and different industries. Sample sizes indicate the number of

interviews for each subgroup. Areas highlighted in green are the Top 2 for each subgroup. Where more than two are highlighted they are equal first/second.

TOTAL In SA Expats Agri-

culture Arts,

creative

Banking +

finance

Building + real estate Defence

Educa-tion Energy

Sample size 800 619 181 15 12 83 34 23 25 29

a management style that you respect 73% 73% 73% 80% 91% 83% 81% 75% 100% 75%

future opportunity for advancement and more responsibility 70% 80% 79% 73% 70% 89% 77% 88% 87% 75%

places its employees needs as essential to business success 68% 79% 75% 62% 82% 82% 83% 75% 78% 86%

reward you for successfully completing complex tasks 68% 80% 71% 64% 90% 87% 87% 79% 87% 64%

a casual and friendly work environment 68% 73% 76% 64% 64% 74% 70% 92% 67% 71%

has a reasonable view of hours worked in an average week 67% 75% 75% 57% 80% 82% 77% 87% 92% 82%

forward thinking and innovative management 67% 67% 65% 80% 82% 80% 69% 67% 92% 75%

well respected and intelligent management 66% 67% 64% 70% 91% 71% 69% 79% 88% 71%

trustworthy management 65% 66% 62% 80% 64% 74% 81% 71% 88% 75%

allows working from home 65% 74% 66% 71% 90% 81% 70% 78% 68% 78%

respectful management 65% 65% 65% 70% 73% 74% 75% 75% 83% 79%

a vision / mission you believe in and support 65% 73% 77% 54% 82% 81% 70% 60% 87% 69%

trust and respect in your abilities 64% 75% 70% 64% 80% 80% 73% 63% 83% 61%

a reputation as an employer of choice 64% 72% 75% 62% 64% 78% 70% 85% 78% 86%

management structure that allows input from all staff 63% 65% 56% 90% 73% 71% 63% 75% 88% 68%

pay / salary is above average compared with other employers 63% 66% 68% 47% 75% 66% 77% 83% 60% 72%

treats you as an individual 63% 64% 57% 70% 73% 72% 66% 71% 83% 71%

make an effort to get to know staff 62% 63% 61% 80% 64% 70% 66% 75% 88% 57%

has reasonable standards for output and workload 62% 62% 62% 80% 73% 67% 75% 79% 83% 71%

an environment that encourages staff to be productive 62% 68% 65% 50% 46% 72% 61% 83% 71% 71%


10

TOTAL

Food + bev

distrbtn Health

services Hospit-

ality

Local govern-

ment Manu-facture Media Mining

Not-for-profit

Other govern-

ment Sample size 800 7 36 5 30 40 25 31 20 87

a management style that you respect 73% 100% 82% 100% 96% 70% 86% 87% 100% 84%

future opportunity for advancement and more responsibility 70% 86% 85% 75% 93% 74% 79% 69% 77% 82%

places its employees needs as essential to business success 68% 83% 88% 100% 86% 70% 76% 86% 73% 77%

reward you for successfully completing complex tasks 68% 86% 71% 100% 72% 83% 84% 79% 73% 81%

a casual and friendly work environment 68% 86% 85% 75% 77% 76% 61% 79% 86% 65%

has a reasonable view of hours worked in an average week 67% 71% 69% 75% 80% 74% 65% 61% 86% 71%

forward thinking and innovative management 67% 57% 91% 100% 89% 60% 62% 81% 75% 80%

well respected and intelligent management 66% 71% 85% 50% 93% 70% 67% 71% 90% 75%

trustworthy management 65% 71% 82% 75% 93% 68% 57% 71% 75% 75%

allows working from home 65% 71% 69% 50% 77% 54% 65% 68% 95% 71%

respectful management 65% 71% 91% 50% 85% 68% 67% 61% 75% 77%

a vision / mission you believe in and support 65% 83% 74% 75% 76% 70% 76% 66% 86% 80%

trust and respect in your abilities 64% 100% 82% 100% 79% 77% 74% 76% 86% 75%

a reputation as an employer of choice 64% 83% 71% 75% 79% 73% 71% 83% 68% 64%

management structure that allows input from all staff 63% 86% 88% 100% 85% 76% 52% 61% 90% 77%

pay / salary is above average compared with other employers 63% 86% 64% 80% 77% 68% 52% 58% 75% 63%

treats you as an individual 63% 71% 85% 75% 78% 76% 57% 55% 95% 67%

make an effort to get to know staff 62% 86% 79% 75% 74% 70% 57% 74% 80% 71%

has reasonable standards for output and workload 62% 71% 76% 75% 74% 60% 67% 71% 90% 68%

an environment that encourages staff to be productive 62% 57% 71% 75% 70% 53% 65% 71% 86% 64%


11

TOTAL

Profess-ional

services Retail

Tech/Communications Tourism Trades

Trans-port Wine

Whole-sale

Sample size 800 118 18 50 19 7 9 8 8

a management style that you respect 73% 82% 88% 81% 94% 100% 57% 100% 88%

future opportunity for advancement and more responsibility 70% 72% 82% 86% 78% 100% 67% 63% 86%

places its employees needs as essential to business success 68% 71% 69% 68% 88% 100% 75% 100% 75%

reward you for successfully completing complex tasks 68% 74% 88% 62% 83% 83% 78% 100% 86%

a casual and friendly work environment 68% 71% 67% 76% 79% 86% 56% 88% 75%

has a reasonable view of hours worked in an average week 67% 73% 65% 69% 72% 83% 50% 88% 63%

forward thinking and innovative management 67% 70% 88% 76% 82% 100% 71% 88% 63%

well respected and intelligent management 66% 74% 75% 81% 82% 100% 57% 88% 50%

trustworthy management 65% 76% 69% 76% 82% 100% 57% 88% 50%

allows working from home 65% 70% 77% 76% 61% 50% 70% 63% 63%

respectful management 65% 70% 81% 69% 94% 100% 71% 100% 63%

a vision / mission you believe in and support 65% 64% 75% 71% 88% 67% 38% 86% 88%

trust and respect in your abilities 64% 65% 71% 69% 83% 83% 44% 100% 71%

a reputation as an employer of choice 64% 67% 75% 75% 88% 100% 50% 86% 50%

management structure that allows input from all staff 63% 67% 75% 62% 82% 83% 43% 63% 50%

pay / salary is above average compared with other employers 63% 65% 56% 72% 79% 57% 78% 63% 38%

treats you as an individual 63% 70% 75% 71% 82% 100% 57% 88% 63%

make an effort to get to know staff 62% 66% 75% 74% 94% 100% 71% 75% 50%

has reasonable standards for output and workload 62% 67% 88% 67% 77% 100% 71% 88% 50%

an environment that encourages staff to be productive 62% 61% 56% 72% 79% 86% 56% 88% 63%


About Square Holes

Square Holes works

with an impressive and

diverse list of blue-

chip commercial and

government clients.

Marketing and business

intelligence services

are provided based on surveys, focus groups, other

methods of gathering insight and, on this, imagination

to guide our clients in brand and product innovation,

sales growth and obtaining business targets.

Some of Square Holes’ recent clients have

included the SA Department of Health, The Cancer

Council South Australia, SafeWork SA, Mamee

Noodles, Coopers Brewery, Adam Internet and the

AFL and SANFL. Other sectors with strong

experience include banking and fi nance; professional

services; real estate and development; retail; and

wine. Topics explored include advertising; brand

reengineering; customer satisfaction; employer

branding; new market entry; product and service

development; tailored trend watching or cool hunting;

and strategy planning and refi nement.

Square Holes is proudly based in Adelaide with a

national client base. Our in-house consultant and fi eld

teams provide fi rst-class qualitative and quantitative

research services. The unique CBD based offi ce

incorporates modern group discussion, client

viewing and survey facilities.

Square Holes offers tailored consulting services

and a suite of innovative tools we have developed

for clients. For more information or to arrange a

no obligation meeting contact Jason Dunstone

on +61[0]8 8232 3355 or [email protected]

Research: Using research as a strategic tool is our

passion and we do this well. From continuous weekly

tracking to ensure time-sensitive responsiveness

to less frequent monitors; and ad hoc studies to

explore opportunities.

Insight: Square Holes designs, implements and

manages tailored consumer, customer and staff insight

programs for clients. We create cultures of innovation.

Evaluation: Square Holes educates and designs client

specifi c programs to guide marketing and other strategy

planning, refi nement, monitoring and refl ection. We

create cultures of learning and continuous improvement.

Wisdom: Square Holes employs inventive approaches

to work with clients to guide staff in the search for

opportunities to be more innovative and continuously

improve. We aim to foster wisdom within our clients.

Information Management: Square Holes works

with clients to develop simple yet powerful systems

to collect information and plant seeds of creativity

and innovation.

Round Pegs: Quality research data and support, when

strategic input is not required. Services include internet,

telephone and face-to-face surveys; recruitment; statistical

analysis; transcribing; and other research support.

report 070707 summary

Business

south australian employers

squares holes pty

south australian employees

research findings

r workplace retention

employee retention

current research available

employers of choice