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Identifying and acquiring human capital in the APS

Workforce planning provides the basis for identifying the human capital needs of an organisation, while engagement and learning and development activities are responsible for securing and building human capital. The development and maintenance of effective human capital is also supported by an organisation's ‘people strategies’. For example, performance management policies and processes are key to the ongoing development of employees. Performance management in the APS is discussed in more detail in Chapter 9.

Workforce planning

While there has been substantial work across the APS on improving the workforce planning capability of agencies over the past four years, improving this capability remains problematic.

In 2011, and again in 2013, agencies were asked in the State of the Service Agency Survey (agency survey) to describe their actions on a number of organisational capabilities and to assess their progress against these using a five-level maturity model.9 One of these capabilities was workforce planning. In 2011 and 2013, less than 20% of agencies assessed their workforce planning capability as mature enough to enable them to achieve agency goals in the following three years. Most agencies that responded to the agency survey in 2013 reported they needed to be one or two levels above their current position to meet their goals in the next three years (73%), while another 13% reported they needed to be three levels above their current position.

Additional results from the agency survey showed that in 2011, 27% of agencies (covering 67% of the workforce) reported they had a documented workforce plan for at least part of their agency. In 2013, 42% of agencies (45% of the workforce) reported they had a workforce plan for at least part of their agency. In 2014, 35% of agencies (73% of the workforce) reported the same. While the proportion of agencies with a workforce plan fluctuated between 2012 and 2014, the proportion of the APS workforce covered by such plans increased, likely due to the development of workforce plans in some larger agencies.

In 2014, 69% of agencies (covering 92% of the workforce) reported they were taking action to improve their workforce planning capability and another 15% of agencies (3% of the workforce) reported they were planning to take action to improve this capability in the next 12 months. Typical activities reported by agencies to improve workforce planning in 2013–14 included, developing workforce plans (both strategic and more focused), conducting specific workforce planning training, developing metrics to support workforce planning, embedding workforce planning into business planning, and engaging specialist workforce planning employees or consultants.

When asked if there were barriers to workforce planning, 27% of agencies identified there were none. The common barriers identified by agencies included: lack of specific workforce planning skills; insufficient datasets; shifting priorities; general lack of resources; and the impact of current APS interim recruitment arrangements on recruiting specialist employees.

While workforce planning is fundamental to determining APS human capital needs and therefore managing its human capital, the APS workforce planning capability is still developing. Efforts to build this capability across the service remain inconsistent.

Engagement

Historically, the APS has typically recruited employees at entry or junior levels with only limited opportunities to enter the service at higher-level positions.10 As such, developing human capital has traditionally occurred within the agency. This practice, known as the ‘build model’ of human capital, was common among large organisations. Recent changes in the socioeconomic environment, however, have seen a change in organisational practices in securing human capital, including a decrease in the sophistication of workforce and succession planning, an increase in outside hiring, more complex ‘alternate’ work arrangements (including more part-time employees and greater use of contractors), and an increasingly mobile workforce.11

While the APS is an enduring organisation and its leaders and managers are responsible for sustaining the APS workforce, the service is also responsive to the priorities and programmes of the government of the day and its workforce reflects this. For instance, using data from the APS Employment Database (APSED) Figure 10.1 shows that the number of engagements as a proportion of the ongoing workforce steadily declined since a peak of almost 16.2% in 2005–06 to 3.1% for 2013–14, while internal recruitment remained relatively constant at below 2%.

Figure 10.1. Engagements, transfers and promotions as a proportion of the ongoing workforce, 2004–05 to 2013–14

Source: APSED

The reduction in APS engagements reflects an ongoing focus on achieving efficiencies and giving expression to government priorities. As such, agencies are focusing on training and developing existing employees to meet human capital needs.

Learning and development and talent management

The role of learning and development in building human capital has a long history. As noted earlier, this is the basis of the ‘build model’ of managing human capital. The APS has traditionally provided learning and development opportunities for employees through individual agency activities and centralised training. The Australian Public Service Commission (the Commission) provides centralised learning and development activities through the Centre for Leadership and Learning (the Centre for Leadership and Learning).

Learning and development

Learning and development is a common activity for APS employees with 85% reporting through the 2014 APS Employee Census (employee census) that they had undertaken some formal training or education in the previous year. This finding was evenly spread across classification levels. Nearly three-quarters (72%) of employees rated their learning and development, including on-the-job training, as moderately effective in helping to improve their work performance (28% felt it was highly or very highly effective).

However, employee perceptions of the effectiveness of learning and development activities may relate to the amount of formal training and education they had undertaken. For example, 57% of employees who undertook more than 10 days of formal training and education rated their experience as highly or very highly effective in helping improve their performance. Alternatively, 57% who participated in no formal training or education in the 12 months before the employee census, rated the effectiveness of their learning and development activities as low or very low.

Nearly two-thirds of agencies (65%, covering 75% of the workforce) reported having a formal learning and development plan in place in 2013–14 that was linked to their business or agency strategy. Most agencies with a formal plan linked that plan to the APS Core Skills Project being undertaken by the Centre for Leadership and Learning. A central feature of learning and development in the APS is the role of the workplace through on-the-job training. Most agencies (86%, covering 94% of the workforce) see employee development as the responsibility of managers and the most commonly reported ways of developing employees on-the-job was through participation in working groups, workplace projects and workplace placements. Only 10% of agencies (covering 11% of the workforce), however, had formally evaluated the extent to which learning takes place on the job.

While most APS employees participated in formal training and education in the 12 months before the employee census (and agencies saw employee development as a valid role for managers in the workplace), results from the agency survey suggest some deficiencies in the provision of learning and development to employees. One-third of agencies (35%, covering 24% of the workforce) reported they did not have, or were developing, a formal learning and development plan for their employees. As noted previously, results from the employee census suggest that employee perceptions of the effectiveness of the training they received related to the amount of formal training and education they had undertaken in the 12 months before the employee census. The APS Leadership and Core Skills Strategy 2012–13 and the APS Leadership and Core Skills Strategy Refresh 2014–15 are designed to address some of these deficiencies in APS learning and development (these strategies are discussed in more detail in Chapter 5).

Talent management

In 2013–14, 44% of agencies (covering 8% of the workforce) reported they had no active talent management strategy in place, while another 17% (covering 12% of the workforce) reported a strategy was being developed. Twenty-three per cent of agencies had a talent management strategy in place for SES employees, 32% had one in place for Executive Level (EL) 2 employees and 27% had one in place for other employees. The most commonly cited reason for having a talent management strategy in place was to ‘build leadership bench strength’ followed by ‘developing high-potential employees’.

Almost half of agencies (47%, covering 85% of the workforce) reported they had started or improved their talent management practices in 2013–14. The Centre for Leadership and Learning has developed a whole-of-APS approach to talent management, the criteria of which have been used by 31% of agencies (covering 54% of the workforce) which had improved, or started to improve, their talent management practices to identify high-potential employees. Overall, 64% of agencies that had undertaken talent management reported that their approach had been influenced by the Centre for Leadership and Learning's work.

Talent management is an important method of building human capital in agencies and across the APS. At present, however, it can best be described as developing, and continued monitoring of this capability as it develops is warranted. There has been early work on developing a more common approach to talent management across the APS, including formal discussions between the Commissioner and Secretaries and major agency heads in relation to succession planning; the introduction of new talent development programmes for SES Band 1 to 3; and work to investigate the value of pursuing more common approaches to performance assessment and reporting across the SES; using methodologies such as the Nine-Box Grid.12


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Footnotes

9 Australian Public Service Commission 2011, State of the Service Report 2010–11, Commonwealth of Australia, Canberra.

10 Australian Public Service Commission 2003, The Australian Experience of Public Sector Reform, Occasional Paper Two, Commonwealth of Australia, Canberra.

11 Hamori, M, Bonet, R & Cappelli, P 2011, ‘How organizations obtain the human capital they need’ in A Burton-Jones & J-C Spender (eds), The Oxford Handbook of Human Capital, Oxford University Press, Oxford, United Kingdom.

12 The Nine-Box Grid was originally developed by General Electric and further developed by the Center for Creative Leadership, specifically by Lombardo & Eichinger, the researchers who developed the 70-20-10 learning model.