Chapter 8: Organisational capability

Abbreviations

A list of the abbreviations used in this report is available in the Glossary

Key chapter findings

The challenge of sustaining high levels of organisational capability currently facing the APS is not new. Many of our current challenges centre around the demographics of an ageing APS workforce combined with the projected tightening of the labour market. This situation is not expected to ease in the short to medium term.

The potential for skills shortages have been highlighted repeatedly in successive State of the Service reports and this year received renewed emphasis with MAC’s report, Managing and Sustaining the APS Workforce. The evidence is now emerging that skill shortages, particularly in areas of specialist skills such as information technology, accounting, and financial management, are becoming widespread across the APS.

APS agencies are increasingly responding in a more systematic way to these challenges. More are implementing formal workforce planning and there is some evidence of increased workforce planning capability and an increasing focus on measures to deal with workforce challenges.

The evidence in the chapter, however, highlights some important challenges. In particular, and consistent with the findings of Managing and Sustaining the APS Workforce, many agencies have identified skills gaps both for their SES, but more particularly, for their SES feeder groups. This is an area of concern in relation to current and future organisational capability. Agencies need to take seriously the need to develop the capacity of the SES feeder group and take a more systematic approach to identifying future leaders.

Part of the response to our growing workforce challenges will inevitably be ensuring that we have the right remuneration strategies in place. APS non-SES salary increases continue to be slightly ahead of overall private sector wage increases, but the difference is narrowing and increases have now been less than the most comparable private sector industries for the past three years. In addition, there is a continuing remuneration gap between the actual level of remuneration received by many APS employees and their private sector equivalents. If this trend continues APS agencies may begin experiencing more difficulties in recruiting quality staff .

Overall, the relationship between organisational capability, remuneration policies and a high quality APS workforce suggests that the APS needs to take a more strategic and integrated approach to developing remuneration policies. Agencies need to have a particular focus on areas of specialist skills in high demand and will benefit from supporting the APS-wide professional communities of accountants, statisticians and ICT professionals being established in response to Managing and Sustaining the APS Workforce.

Nevertheless, no matter how innovative our approaches we will need to confront the budgetary pressures that meeting these workforce challenges will create, including higher remuneration and increased investment in both technology and staff training and development. Pressures on our one-size-fits-all financial allocation process, in an ever-tightening labour market, will only increase.

The area of record keeping continues to be a problematic one for the APS as a whole and for individual agency effectiveness.

Overall, the agency and employee survey results regarding record keeping were fairly positive, highlighting the fact that most agencies consider record keeping a priority issue. Employees, however, have mixed views about the success of these efforts and many feel that, considering their work demands, they do not have enough time to meet their record keeping responsibilities. There is also limited evidence that agencies are dealing with the challenge of electronic record keeping effectively.

The experience of DIMIA demonstrates what can go wrong when record keeping fails, and reinforces the importance of making record keeping a routine part of business operations within all APS agencies. MAC’s project on record keeping should be a useful tool in reinforcing the priority of record keeping to all employees and encouraging agencies to develop practical, business-oriented, and easy-to-use systems in place to help people achieve essential record keeping.

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