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THE TELSTRA PRODUCTIVITY
INDICATOR
> A REPORT ON BUSINESS ATTITUDES
AND BEHAVIOURS TOWARDS IMPROVING
PRODUCTIVITY IN AUSTRALIA
APRIL 2011
02
TABLE OF CONTENTS
1. OVERVIEW 04
1.1 Introduction 05
1.2 Key findings from TPI 2011 05
2. PRODUCTIVITY IN ORGANISATIONS 06
2.1 Productivity improvement is a high priority for the future 07
2.2 Private sector vs Government productivity improvements over the last 12 months 09
2.3 Is productivity managed and measured? 09
2.4 Productivity Leaders 10
3. PRODUCTIVITY AND INVESTMENT 12
3.1 Investment plays an important role in improving productivity 13
3.2 Productivity Leaders’ priorities for ICT investment to improve productivity, now and
in the future 17
3.3 Continuing emphasis on organisation-wide productivity programs 20
3.4 Productivity Leaders are more likely to focus on collaboration (both internally and externally) 21
3.5 ICT enables Productivity Leaders to create a more engaged workforce 21
3.6 Productivity Leaders are more likely to use ICT in connecting with customers 23
3.7 Challenges for ICT adoption 26
4. PRODUCTIVITY IMPROVEMENT IN THE FUTURE 28
4.1 Productivity Leaders expect more growth 29
5. CONCLUSION 30
FOREWORD
Telstra is pleased to present the third
Telstra Productivity Indicator (TPI), a
comprehensive report on large Australian
organisations’ attitudes and behaviours in
relation to improving their productivity.
Over the last two years, there has been
increasing awareness that Australia needs to
focus on becoming more productive to ensure
long-term prosperity. Findings from the initial
Telstra Productivity Indicator were incorporated
into a Federal Government report in early May
2010 (Inquiry into raising the productivity growth
rate in the Australian economy). The Grattan
Institute report released in February 2011
(Australia’s Productivity Challenge) highlights
the challenges in reversing Australia’s apparent
decline in productivity performance. These
references acknowledge the importance and
demonstrate the relevance of the TPI.
This year, 350 representatives from enterprise
and Government organisations were surveyed
for the Telstra Productivity Indicator 2011
(TPI 2011). The results indicate that, while
productivity continues to be a high business
priority, many large organisations do not
measure productivity and cannot confirm that
they have achieved significant productivity
improvements over the past year. TPI identifies
this as the Productivity Improvement Deficit.
The results also confirm that there is a
clear distinction between the strategies of
organisations that have experienced significant
improvements in productivity (referred to as
‘Productivity Leaders’) versus those who are yet
to reap the benefits.
The key management and cultural characteristics
being driven by these Productivity Leaders
include investment in whole of enterprise
productivity programs, greater collaboration with
all stakeholders and utilising information and
communication technologies (ICT) to connect
with customers and employees. The strategies
of these organisations highlight the value and
significance of understanding their business
priorities, investing in programs that deliver
clear benefits and continuing to invest in ICT
to ensure future productivity improvements.
Importantly, the report finds that investment
in ICT has consistently featured as a critical
contributor to improving productivity over the
last three years. It is also clear that Productivity
Leaders place significantly more importance on
the role of ICT in improving productivity.
At Telstra, we continue to be committed to
improving the way people and organisations work
by identifying and delivering real productivity
gains both for our customers and within our
own business. Based on our TPI findings, we
have introduced the ICT Productivity Diagnostic,
a specialist consulting service to establish
an organisation’s productivity improvement
potential and ICT priorities. We also offer
Productivity and Innovation roundtables, and
access to industry subject matter experts
to help customise ICT roadmaps to specific
industries and organisations.
I am pleased to present this year’s report. I
am sure that it will once again contribute to
informing the discussions, decisions and actions
that will be vital to realising the productivity
potential of large Australian organisations and
Australia in general.
David Thodey
Chief Executive Officer
Telstra
03
1OVERVIEW
04
05
1.1 INTRODUCTION
The third annual Telstra Productivity Indicator
(TPI 2011) reports on productivity improvement
in large organisations. In particular, the focus
in TPI 2011 is on those organisations that
are successfully achieving productivity
improvement, and the extent to which the
decisions taken and priorities set by leaders
in successful organisations differ from those
in organisations that are seeing little or no
productivity improvements.
This independently researched report was
obtained through a survey of 350 private sector
(N=245) and Government (N=105) leaders. It
represents many hours of in-depth interviews
aimed at better understanding productivity and
its drivers.
1.2 KEY FINDINGS FROM TPI 2011
Executive Summary
Productivity is a top business priority for the
majority (76%) of large organisations. However,
TPI 2011 identifies a continuing Productivity
Improvement Deficit. The deficit is defined as the
difference between those who rank productivity
as an important business priority (76%) and
those who actually measure productivity and
state that they have achieved significant
productivity improvement over the last
12 months (24%). The Productivity Improvement
Deficit is therefore 52% (76% minus 24%),
suggesting that many large Australian
organisations are struggling to deliver against
their business priorities.
While the Productivity Improvement Deficit is
51% for the private sector, it stands at 58% for
Government. Seventy-two percent of Government
organisations rate productivity as an important
priority, however only 14% of them measure it
and report significant productivity improvement
over the last 12 months. This compares to 76%
and 25% respectively for organisations in the
private sector.
Focusing on those organisations that have
productivity Key Performance Indicators (KPIs)
and experienced significant improvements in
productivity, provides a valuable insight into
what we are terming ‘Productivity Leaders’.
Productivity Leaders are characterised
by a number of success factors that set
them apart from those who are not achieving
significant productivity improvements, a group
we refer to as ‘Followers’. The research suggests
Productivity Leaders are better connected from
an information and communications technology
(ICT) perspective than their peers. Identifying the
strategies of these Productivity Leaders provides
insights that can enable Followers to close the
shortfall and manage their own productivity
improvement strategies.
Productivity Leaders recognise the importance
of making investments to improve productivity
Relying on a diverse range of initiatives to help
them succeed, Productivity Leaders place a
greater priority than their peers on the following
investments:
■ customer communications (65% versus 29%)
■ ICT (58% vs 35%)
■ process improvements (57% vs 30%)
■ employee engagement (49% vs 27%)
Productivity Leaders are more likely to have
invested in ICT in the past and plan to do so
in the future
Recognising the importance of ICT investment
to drive productivity improvements, Productivity
Leaders favour investments in the following
areas over their peers in the coming 12 months:
■ using broadband/IP network to deliver
business applications (72%)
■ improved data network speeds and broader
network coverage (69%)
■ improved access to, and sharing of,
information and resources across different
locations (69%)
■ improved use of emails and other electronic
messaging (57%)
■ improved automated business processes
and forms online (57%)
■ improved technologies to access business
applications and manage activities while
out of office (56%)
Productivity Leaders invest in whole of
organisation productivity programs and
collaboration
Compared to Followers, Productivity Leaders
place more emphasis on whole of organisation
productivity programs (78% vs 65%) and are
more likely to focus on:
■ how individuals and groups work together
(86% vs 60%)
■ collaboration between the organisation and
customers (79% vs 65%)
■ collaboration with suppliers and partners
(58% vs 44%)
Productivity Leaders utilise ICT to create a
more engaged workforce
Productivity Leaders are more likely than their
peers to align ICT deployment to the needs of
their employees so as to engage and retain their
workforce. They are more likely than Followers to:
■ ensure that all employees have access to
shared data (74% vs 64%)
■ retain existing talent (68% vs 55%)
■ improve safety (62% vs 54%)
■ attract young talent (61% vs 48%)
■ enable flexible working, including working
from home (56% vs 47%)
Productivity Leaders utilise ICT to connect
with their customers
Productivity Leaders are more likely than their
peers to deploy ICT services to connect with
their customers.
■ 49% of Productivity Leaders compared to only
26% of Followers emphasise the importance
of ICT to give high-value customers priority
access to customer resources
■ 44% of Productivity Leaders and only 24% of
their peers invest in developing strategies to
target and engage Generation Y customers
Productivity Leaders are less influenced by
perceived barriers to investing in ICT and
more optimistic about the future
Having already experienced productivity
improvements, Productivity Leaders are less
deterred by perceived barriers, such as capital
and operational investment costs, when
investing in ICT. Compared to their peers, and
perhaps by virtue of being further along a
successful ICT adoption path, they place greater
focus on challenges such as cultural change
and the lack of uniform availability of products
and services.
Productivity Leaders also stand out in their
attitude to anticipating future productivity gains.
Seventy-four percent believe they will experience
improvement in the next 12 months, compared
with only 33% of Followers.
The following sections focus on:
■ productivity and other business priorities
within organisations (Section 2)
■ the role that ICT plays in improving
productivity (Section 3)
■ the outlook for productivity in the future
(Section 4)
6
2PRODUCTIVITY IN ORGANISATIONS
06
07
2.1 PRODUCTIVITY IMPROVEMENT IS A HIGH PRIORITY FOR THE FUTURE
As in the previous waves of the survey,
organisation leaders rated a number of
business priorities in terms of their importance
to them over the next 12 months. Productivity
is consistently rated as a top priority for the
majority of large organisations (76%), exceeded
only by customer service in TPI 2011.
Productivity is a high priority for both private
sector and Government organisations.
However, in other areas the private sector and
Government organisations differ in their values
and aspirations. Government organisations
place higher priority on creating an engaged
workforce (76% vs 61% for the private sector),
and less emphasis on increasing revenue
(27% vs 76%), and developing new revenue
streams (21% vs 55%).
FIGURE 1: BUSINESS PRIORITIES OVER THE NEXT 12 MONTHS PRIVATE SECTOR VS GOVERNMENT
Question: Thinking about the future of your organisation…how would you rate the following? (All: N=350).
Note: The X axis represents the percentage of respondents that assign a priority of 8 or more on a scale of
1-10. Chart figures are unweighted (N=245 Private, N=105 Government).
PRIVATE SECTOR GOVERNMENT
IMPROVING CUSTOMEREXPERIENCE
81%
71%
IMPROVING PRODUCTIVITY76%
72%
INCREASING REVENUE76%
27%
CREATING AN ENGAGEDWORKFORCE
61%
76%
MANAGING RISK72%
77%
DEVELOPING NEWREVENUE STREAMS
55%
21%
DECREASING COSTS72%
64%
ASSET UTILISATION46%
54%
CORPORATE SOCIALRESPONSIBILITY
40%
44%
ENVIRONMENT SUSTAINABILITYPRACTICES
46%
49%
R&D OF NEW PRODUCTSAND SERVICES
39%
35%
08
Question: Thinking about the future of your organisation, how would you rate the following?
(Technology Decision Makers and C-level Management: N=206).
Note: The X axis represents the percentage of respondents that assign a priority of 8 or more on a scale of 1-10.
Respondents with a C-level Management
role in the organisation were more likely than
Technology Decision Makers to prioritise the
creation and maintenance of an engaged
workforce (69% vs 57%).
The priorities of Technology Decision Makers
differed from C-level Management in how
they rated environmental sustainability (47%
technological vs 23% C-level Management),
corporate social responsibility (39% vs 28%),
decreasing costs (78% vs 67%), improving
customer experience (85% vs 75%) and
improving asset utilisation (45% vs 35%).
FIGURE 2: BUSINESS PRIORITIES OVER THE NEXT 12 MONTHS TECHNOLOGY DECISION MAKERS VS C-LEVEL MANAGEMENT
TECHNOLOGY DECISION MAKERS C-LEVEL MANAGEMENT
IMPROVING CUSTOMEREXPERIENCE
85%
75%
IMPROVING PRODUCTIVITY
78%
73%
DECREASING COSTS78%
67%
INCREASING REVENUE71%
70%
45%
35%IMPROVING ASSET UTILISATION
47%
23%
ENVIRONMENT SUSTAINABILITYPRACTICES
37%
37%
R&D OF NEW PRODUCTSAND SERVICES
49%
40%
DEVELOPING NEWREVENUE STREAMS
57%
69%
CREATING AN ENGAGEDWORKFORCE
39%
28%
CORPORATE SOCIALRESPONSIBILITY
ROLE OF RESPONDENTS Sample size (n) Unweighted1 Weighted2
Technology Decision Makers3 155 44% 47%
C-level Management (business/finance) 51 15% 14%
Other management 144 41% 39%
Total 350
TABLE A: ROLE OF RESPONDENTS
1The unweighted figure is the percentage in the survey sample.
2 The weighted figure is adjusted to reflect the percentage in the population from which the survey sample
is drawn.
3Includes CIOs/CTOs.
09
2.2 PRIVATE SECTOR VS GOVERNMENT PRODUCTIVITY IMPROVEMENTS OVER THE LAST 12 MONTHS
Private sector organisations are more
likely to have seen significant productivity
improvements in the last 12 months compared
to Government organisations (30% vs 19%).
2.3 IS PRODUCTIVITY MANAGED AND MEASURED?
Those organisations that have Key Performance
Indicators (KPIs) in place to measure
productivity are more likely to achieve
improvements; a third (32%) of organisations
with KPIs experienced productivity improvement
over the past 12 months, compared with
only 19% of those without KPIs. This finding
underlines the need for organisations to have
measures and targets in place in order to
monitor productivity improvements.
Overall, the adoption of KPIs by organisations
has remained the same over the three TPI years,
at around three quarters (74%). KPI adoption
is higher among private sector organisations
(76%) than Government organisations (66%).
FIGURE 3: ACHIEVED PRODUCTIVITY IMPROVEMENTS OVER THE LAST 12 MONTHS PRIVATE SECTOR VS GOVERNMENT
30%
19%
Question: Would you say that productivity within your organisation in the last 12 months has increased a
great deal, a lot, a moderate amount, a little, or not increased at all? (All: N=350).
Note: The Y axis represents the percentage of respondents that indicated productivity increased a great deal
or a lot. Chart figures are unweighted (N=245 Private, N=105 Government).
66%
76%
FIGURE 4: PROPORTION WITH KEY PERFORMANCE INDICATORS (KPIs)PRIVATE SECTOR VS GOVERNMENT
Question: Does your organisation have specific measures, such as KPIs, that you use to quantify
productivity improvements? (All: N=350).
Note: The Y axis represents the percentage of respondents. Chart figures are unweighted (N=245
Private, N=105 Government).
PRIVATE SECTOR GOVERNMENT
PRIVATE SECTOR GOVERNMENT
10
76%
14%
FIGURE 6: THE PRODUCTIVITY IMPROVEMENT DEFICIT PRIVATE SECTOR VS GOVERNMENT 2011
2.4 PRODUCTIVITY LEADERS
Focusing on those organisations that have set
productivity KPIs and experienced significant
improvements in productivity provides a
valuable insight into ‘Productivity Leaders’.
Comparing their strategies with those of their
peers identifies opportunities for managing
productivity improvement and provides an
insight for Followers to help set their strategies.
The TPI 2011 Productivity Improvement Deficit
focuses on actual improvement over the past
12 months, as well as the setting of targets. The
deficit is defined as the difference between those
who rank productivity as an important business
priority (76%) and those who actually measure
productivity and state they have achieved
significant productivity improvements over the
past 12 months (24%). The TPI 2011 Productivity
Improvement Deficit is therefore 52% (76%
minus 24%). This finding suggests that many
large organisations in Australia are struggling
to deliver against their productivity priorities.
The Productivity Improvement Deficit has
steadily decreased from 59% in TPI 2009, to
52% in TPI 2011, suggesting that productivity
initiatives and investments are paying off for
some organisations.
The narrowing of this deficit may in part be
attributed to the emergence of Productivity
Leaders, whose prevalence has increased year on
year, from 19% in TPI 2009, to 24% in TPI 2011.
The Productivity Improvement Deficit is 51%
for the private sector and 58% for Government.
Seventy-two percent of Government
organisations rate productivity as a priority,
however only 14% have measured and achieved
significant productivity improvement over the
last 12 months. In the private sector, 76% of
organisations rate productivity as a high priority,
while 25% measure it and have achieved
significant productivity improvements over the
last 12 months.
Organisation size and industry sector do not
appear to have an impact on whether an
organisation is a Productivity Leader. However,
Government organisations are less likely to
be Productivity Leaders than private sector
organisations (14% vs 25%).
FIGURE 5: THE PRODUCTIVITY IMPROVEMENT DEFICIT BY SURVEY YEAR
Note: The Y axis represents the percentage of respondents. All figures are weighted to be
representative of the distribution in the target population.
78%
19%
76%
22%
76%
24%
PRODUCTIVITY IS A HIGH PRIORITY FOR THE FUTURE OF MY ORGANISATION
PRODUCTIVITY IS A HIGH PRIORITY FOR THE FUTURE OF MY ORGANISATION
HAVE KPIs AND EXPERIENCED PRODUCTIVITY IMPROVEMENTS
HAVE KPIs AND EXPERIENCED PRODUCTIVITY GROWTH
59% DEFICIT
54% DEFICIT
52% DEFICIT
2009 2010 2011
Note: The Y axis represents the percentage of respondents. Chart figures are unweighted (N=245
Private, N=105 Government). Any reporting of the average for all large organisations will apply
weighted samples (N=306 Private, N=44 Government) to be representative of the distribution of
the target population.
51% DEFICIT 58%
DEFICIT
72%
25%
PRIVATE SECTOR GOVERNMENT
11
3PRODUCTIVITY AND INVESTMENT
12
13
3.1 INVESTMENT PLAYS AN IMPORTANT ROLE IN IMPROVING PRODUCTIVITY
Respondents rated the importance of various
types of investment in terms of impact on
their organisation’s productivity over the last
12 months. Looking across all respondents,
investment in ICT is seen as the biggest overall
contributor to productivity across all three years
of the TPI study.
Focusing on the differences between
Productivity Leaders and their peers in terms
of what they believe drives productivity
improvement, it is clear that Productivity
Leaders consistently rely on a wide range of
investments and initiatives to succeed.
Productivity Leaders are more likely to rate
highly the importance of all productivity drivers,
while recognising that some investments
yield greater productivity returns than others.
Productivity Leaders receive the greatest returns
compared to their peers from:
■ investment in effective customer
communications (65% vs 29%)
■ investment in ICT (58% vs 35%)
■ process improvements (57% vs 30%)
■ employee engagement (49% vs 27%)
FIGURE 7: IMPACT OF INVESTMENTS ON PRODUCTIVITYPRODUCTIVITY LEADERS VS FOLLOWERS (OVER THE LAST 12 MONTHS)
PRODUCTIVITY LEADERS FOLLOWERS
CUSTOMERCOMMUNICATIONS
65%
29%
ICT58%
35%
PROCESSIMPROVEMENTS
57%
30%
OTHER TECHNOLOGYOUTSIDE OF ICT
40%
20%
EMPLOYEEENGAGEMENT
49%
27%
ASSET UTILISATION34%
18%
STAFF TRAINING40%
31%
ENERGY EFFICIENCY27%
15%
Question: Now thinking about productivity improvements, how much of an improvement have these
investments made to your organisation over the last 12 months? (All: N=350).
Note: The X axis represents the percentage of respondents that assigned a great deal or a lot of impact
to the attribute.
14
FIGURE 8: IMPACT OF INVESTMENTS ON PRODUCTIVITY TECHNOLOGY DECISION MAKERS VS C-LEVEL MANAGEMENT
C-level Management respondents and
Technology Decision Makers were similar in terms
of their perception of investment returns – the
only significant differences were that Technology
Decision Makers were more likely to rate highly
the value of:
■ investment in customer communications
(40% vs 20%)
■ ICT investments (42% vs 23%) ICT
42%
23%
CUSTOMERCOMMUNICATIONS
40%
20%
PROCESS IMPROVEMENTS
38%
30%
OTHER TECHNOLOGYOUTSIDE OF ICT
24%
23%
STAFF TRAINING31%
36%
ASSET UTILISATION20%
17%
EMPLOYEE ENGAGEMENT28%
34%
ENERGY EFFICIENCY14%
15%
Question: Now thinking about productivity improvements, how much of an improvement have these
investments made to your organisation over the last 12 months? (Technology Decision Makers and
C-level Management: N=206).
Note: The X axis represents the percentage of respondents indicating a lot or a great deal of
productivity improvement achieved through these investments.
TECHNOLOGY DECISION MAKERS C-LEVEL MANAGEMENT
15
16
17
TYPE OF ICT INVESTMENT Productivity Leaders Followers
Difference between
Productivity Leaders
and Followers
Improved ability to manage/distribute
and receive streamed video content31% 11% 20%
Improved automated business
processes and forms online48% 29% 19%
Improved data network speeds and
broader network coverage68% 53% 15%
Improved access to, and sharing of,
information and resources across
different locations
66% 52% 14%
Improved e-commerce capabilities/
provide customers with online/
self-service facilities
37% 24% 13%
Improved technologies to access
business applications and manage
activities while out of office
53% 41% 12%
Improved remote monitoring of plant/
vehicle fleet and other assets32% 21% 11%
Improved video conferencing and
collaboration for meetings29% 20% 9%
Using broadband/IP network to deliver
business applications73% 65% 8%
More outsourced hosting of data and
applications such as databases/
websites/software
17% 18% -1%
Improved use of emails and other
electronic messaging43% 47% -4%
3.2 PRODUCTIVITY LEADERS’ PRIORITIES FOR ICT INVESTMENT TO IMPROVE PRODUCTIVITY, NOW AND IN THE FUTURE
The survey suggests that Productivity Leaders recognise the importance of specific ICT investments for
improving their productivity, both in the last 12 months and over the next year.
The analysis highlights a number of specific technology priorities that Productivity Leaders have focused on
in the past, as well as being more likely to invest in going forward (Tables B and C). These priorities include:
TABLE B: IMPORTANCE OF ICT TO IMPROVING PRODUCTIVITY OVER LAST 12 MONTHS
18
TYPE OF ICT INVESTMENT Productivity Leaders Followers
Difference between
Productivity Leaders
and Followers
Improved ability to manage/distribute
and receive streamed video content38% 18% 20%
Improved automated business
processes and forms online57% 43% 14%
Improved access to, and sharing of,
information and resources across
different locations
69% 58% 11%
Improved video conferencing
and collaboration for meetings41% 32% 9%
Improved remote monitoring of plant/
vehicle fleet and other assets32% 26% 6%
Improved technologies to access
business applications and manage
activities while out of office
56% 51% 5%
Improved e-commerce capabilities/
provide customers with online/
self-service facilities
42% 37% 5%
Improved data network speeds
and broader network coverage69% 64% 5%
Using broadband/IP network to
deliver business applications72% 67% 5%
More outsourced hosting of data
and applications such as databases/
websites/software
27% 24% 3%
Improved use of emails and other
electronic messaging57% 57% 0%
Productivity Leaders appear better connected than their peers, having already established foundational
network capabilities which have enabled productivity improvements. Productivity Leaders are now expecting
to leverage these investments by further exploiting the technologies outlined below in Table C:
The six key technologies that Productivity Leaders believe will be crucial to improving their productivity in
the next 12 months are:
1. Using broadband/IP network to deliver business applications (72%)
2. Improved data network speeds and broader network coverage (69%)
3. Improved access to, and sharing of, information and resources across different locations (69%)
4. Improved use of emails and other electronic messaging (57%)
5. Improved automated business processes and forms online (57%)
6. Improved technologies to access business applications and manage activities while out of office (56%)
TABLE C: IMPORTANCE OF ICT TO IMPROVING PRODUCTIVITY OVER NEXT 12 MONTHS
19
Productivity Leaders are more likely to see the
value of the ICT investments outlined in Tables
B and C. There is some evidence that Followers
are also recognising the importance of
investment in specific technologies to improve
their productivity in the long term.
Looking at the difference between how
organisations rate the importance of each
of the technologies over the last 12 months,
compared with their expectations over the next
12 months, the biggest contrasts are seen
among Followers. This indicates an intention to
harness the productivity improvements that can
be delivered by ICT solutions already being used
by Productivity Leaders.
FIGURE 9: CHANGE IN THE PERCEIVED IMPORTANCE OF ICT INVESTMENTS FOR PRODUCTIVITY PRODUCTIVITY LEADERS VS FOLLOWERS (OVER THE LAST 12 MONTHS)
Question: Now thinking about ways in which your organisation has used information and communication
technology, how important has each of the following been to improving the productivity of your business
in the last 12 months? (All: N=350).
Note: The X axis represents the year-on-year change in percentage of respondents that say ICT will be
important to achieving outcomes.
IMPROVED USE OF EMAILS14%
10%
IMPROVED VIDEO CONFERENCING 12%12%
12%
OUTSOURCED HOSTING OF DATA AND APPS
10%
6%
TECHNOLOGIES TO ACCESS BUSINESS APPLICATIONS
OUT OF OFFICE
3%
10%
AUTOMATED BUSINESS PROCESS ONLINE
9%
14%
DATA NETWORK SPEEDS AND NETWORK COVERAGE
1%
11%
IMPROVED E-COMMERCE5%
13%
PRODUCTIVITY LEADERS FOLLOWERS
20
30%
INDIVIDUAL PRODUCTIVITY
42%
34%
68%
TOTAL ORGANISATION PRODUCTIVITY
62%66%
53%
WORKGROUP PRODUCTIVITY
62%59%
FIGURE 10: FOCUS OF PRODUCTIVITY IMPROVEMENT PROGRAMS BY SURVEY YEAR
TPI 2009 TPI 2010 TPI 2011
3.3 CONTINUING EMPHASIS ON ORGANISATION-WIDE PRODUCTIVITY PROGRAMS
The focus on whole of organisation productivity
programs is a continuing trend along with
the corresponding diminishing focus on
individual productivity programs. The majority of
organisation leaders were more likely to focus on
organisation-wide productivity initiatives (68%,
compared with 53% on workgroup productivity
and 30% on individual productivity programs).
Organisations in the private sector are more
likely than Government organisations to focus on
organisation-wide productivity (70% vs 55%),
but there is no difference in focus when it comes
to individual or workgroup productivity.
The focus on whole of organisation productivity
is particularly marked for Productivity Leaders
(78% Leaders vs 65% Followers).Question: When looking for opportunities to improve productivity, on which of the following areas do you
focus? (All: N=350).
Note: The Y axis represents the percentage of respondents that assigned a great deal or a lot of focus by
type of program.
FIGURE 11: FOCUS OF PRODUCTIVITY IMPROVEMENT PROGRAMS PRODUCTIVITY LEADERS VS FOLLOWERS
INDIVIDUAL PRODUCTIVITY
31%29%
TOTAL ORGANISATION PRODUCTIVITY
78%
65%
WORKGROUP PRODUCTIVITY
51%53%
Question: When looking for opportunities to improve productivity, on which of the following areas do you
focus? (All: N=350).
Note: The Y axis represents the percentage of respondents looking for opportunities to improve productivity
by type of program.
PRODUCTIVITY LEADERS FOLLOWERS
21
FIGURE 12: IMPORTANCE OF ICT IN EMPLOYEE ENGAGEMENT OUTCOMES PRODUCTIVITY LEADERS VS FOLLOWERS
IMPROVING COLLABORATIONBETWEEN ORGANISATION
& CUSTOMERS
79%
65%
IMPROVING COLLABORATION
WITH SUPPLIERS/PARTNERS
58%
44%
IMPROVING HOW INDIVIDUAL /GROUPS
WORK TOGETHER
86%
60%
Question: How important will information and communication technology be in achieving each of the
following outcomes for your organisation in the next 12 months? (All: N=350).
Note: The X axis represents the percentage of respondents that say ICT will be extremely or very important to
achieving outcomes indicated.
Question: How much emphasis does your organisation place on the following areas? (All N=350).
Note: The Y axis represents the percentage of respondents that assigned a lot of emphasis to improving
collaboration by type of employee engagement.
3.5 ICT ENABLES PRODUCTIVITY LEADERS TO CREATE A MORE ENGAGED WORKFORCE
Productivity Leaders are more likely than their
peers to align ICT deployment to the needs of
their employees, using a range of ICT initiatives
to engage and retain their workforce. They are
more likely than Followers to use ICT to:
■ grow revenue streams by harnessing staff
feedback (47% vs 29%)
■ retain existing talent (68% vs 55%)
■ attract young talent (61% vs 48%)
■ ensure that all employees have access to
shared data (74% vs 64%)
3.4 PRODUCTIVITY LEADERS ARE MORE LIKELY TO FOCUS ON COLLABORATION (BOTH INTERNALLY AND EXTERNALLY)
In addition to focusing improvement initiatives
on their organisations as a whole, Productivity
Leaders tend to be more strategic than Followers
in facilitating holistic and connected working
practices. As a result they are more likely than
Followers to focus internally on how individuals
and groups work together (86% vs 60%),
followed by collaborating with customers
(79% vs 65%) and with suppliers/partners
(58% vs 44%).
Government organisations are more likely than
private sector organisations to place greater
emphasis on improving collaboration with key
stakeholders and interest groups (80% vs 49%).
ENSURING ALL EMPLOYEES HAVEACCESS TO SHARED INFO/DATA
74%
64%
RETAINING EXISTING TALENT68%
55%
IMPROVING SAFETY62%
54%
AUTOMATING FIELDWORKFORCE PROCESSES
49%
39%
ATTRACTING YOUNG TALENT61%
48%
USING STAFF FEEDBACK TOIMPROVE REVENUE STREAMS
47%
29%
ENABLING FLEXIBLE WORKING,INCLUDING WORKING FROM HOME
56%
47%
FIGURE 13: IMPORTANCE OF ICT IN EMPLOYEE ENGAGEMENT OUTCOMESPRODUCTIVITY LEADERS VS FOLLOWERS
PRODUCTIVITY LEADERS FOLLOWERS
PRODUCTIVITY LEADERS FOLLOWERS
22
Technology Decision Makers rated the importance
of ICT investment in creating engaged employees
more highly than C-level Management
respondents in the areas of:
■ enabling flexible working (53% vs 33%)
■ using staff feedback to improve revenue
streams (32% vs 13%)
■ automating field workforce processes
(45% vs 31%)
■ retaining existing talent (63% vs 51%)
Question: How important will information and communication technology be in achieving each of the
following outcomes for your organisation in the next 12 months? (Technology Decision Makers vs C-level
Management: N=206).
Note: The X axis represents the percentage of respondents that indicate ICT will be extremely or very
important to achieving the outcomes indicated.
FIGURE 14: IMPORTANCE OF ICT IN EMPLOYEE ENGAGEMENT OUTCOMES TECHNOLOGY DECISION MAKERS VS C-LEVEL MANAGEMENT
ENSURING ALL EMPLOYEES HAVE ACCESS TO SHARED INFO/DATA
68%
66%
RETAINING EXISTING TALENT63%
51%
IMPROVING SAFETY54%
55%
AUTOMATING FIELD WORKFORCE PROCESSES
45%
31%
ENABLING FLEXIBLE WORKING, INCLUDING WORKING FROM HOME
53%
33%
USING STAFF FEEDBACK TO IMPROVE REVENUE STREAMS
32%
13%
ATTRACTING YOUNG TALENT49%
52%
TECHNOLOGY DECISION MAKERS C-LEVEL MANAGEMENT
23
3.6 PRODUCTIVITY LEADERS ARE MORE LIKELY TO USE ICT IN CONNECTING WITH CUSTOMERS
Productivity Leaders are nearly twice as likely as Followers (49% vs 26%) to emphasise the importance
of ICT in giving high-value customers priority access to resources. Similarly, 44% of Productivity Leaders,
and only 24% of Followers, emphasise the importance of ICT in developing strategies to target and engage
Generation Y customers.
Question: How important will information and communication technology be in achieving each of the
following outcomes for your organisation in the next 12 months? (All: N=350).
Note: The Y axis represents the percentage of respondents that rate ICT as extremely or very important.
FIGURE 15: IMPORTANCE OF ICT IN CUSTOMER CONNECTEDNESS OUTCOMES PRODUCTIVITY LEADERS VS FOLLOWERS
ANALYSING REASONSFOR INBOUND
CUSTOMERCONTACT
48%
36%
GIVING HIGH-VALUE CUSTOMERS PRIORITY
ACCESS
49%
26%
REACHINGCUSTOMERS
WHILE THEY AREOUT AND ABOUT
49%
33%
ATTRACTINGGENERATION Y
CUSTOMERS
44%
24%
PRODUCTIVITY LEADERS FOLLOWERS
24
The respondent’s role within the organisation – whether they are a Technology Decision Maker or a C-level
Management leader – is associated with the extent to which they value the alignment of ICT to support
customer connectedness. Technology Decision Makers are more likely than those with a C-level Management
focus to value ICT investment for:
■ inbound customer contact (44% vs 27%)
■ attracting Generation Y customers (34% vs 18%)
■ ensuring that high-value customers are given priority access (33% vs 20%)
Question: How important will information and communication technology be in achieving each of
the following outcomes for your organisation in the next 12 months? (Technology Decision Makers
vs C-level management: N=206).
Note: The Y axis represents the percentage of respondents by importance of ICT to outcomes.
FIGURE 16: IMPORTANCE OF ICT IN CUSTOMER CONNECTEDNESS OUTCOMES TECHNOLOGY DECISION MAKERS VS C-LEVEL MANAGEMENT
ANALYSING REASONSFOR INBOUND
CUSTOMERCONTACT
44%
27%
GIVING HIGH-VALUE CUSTOMERS PRIORITY
ACCESS
33%
20%
REACHINGCUSTOMERS
WHILE THEY AREOUT AND ABOUT
37%
31%
ATTRACTINGGENERATION Y
CUSTOMERS
34%
18%
TECHNOLOGY DECISION MAKERS C-LEVEL MANAGEMENT
2525
26
LACK OF UNIFORMAVAILABILITY OF
PRODUCTS
21%
18%
23%
COMPLEXITY OFMANAGING CHANGE
32%
30%
35%
OPERATIONAL EXPENSEBUDGETS IN ADDITION
TO I.T. BUDGETS4
29%
31%
TIME TO ROLL OUT
29%
31%
28%
CULTURAL CHANGEREQUIRED4
26%
33%
Question: Do the following present a small, moderate or large barrier to the introduction of new ICT in
your organisation? (All: N=350).
Note: The X axis represents the percentage of respondents that consider the barrier to be large.
4Introduced in 2010.
3.7 CHALLENGES FOR ICT ADOPTION
As in previous TPI surveys, the main perceived
barrier to ICT adoption remains the cost of
investment (36%). The perceived complexity of
managing change has increased since TPI 2010
and is now the second largest barrier (35%).
The lack of uniform availability of products
and services (23%) has also increased as a
perceived barrier since TPI 2010; all others have
remained at similar levels to previous surveys.
Government organisations are more likely than
those in the private sector to perceive cost as a
barrier to adoption of ICT (44% vs 33%).
FIGURE 17: BARRIERS TO ICT INVESTMENT BY SURVEY YEAR4
COST OF CAPITALINVESTMENT IN NEW ICT
49%
37%
36%
TPI 2009 TPI 2010 TPI 2011
27
In their assessment of barriers, there are
important differences between Productivity
Leaders and Followers. These differences might
point to the reasons why Productivity Leaders are
succeeding in improving their productivity levels.
Productivity Leaders are less concerned about
cost than their peers and more prepared to
take risks and deal with change. Compared to
Followers, Productivity Leaders perceive capital
investment cost and operational expense to be
less of a barrier. They are also less concerned
with the perceived complexity of managing
change, as well as the time it takes to roll out
new ways of doing things.
The results suggest that they are further
down the road in terms of ICT investment
and utilisation than Followers. This allows
them to focus on challenges such as dealing
with cultural change and the lack of uniform
availability of products and services.
Question: Some possible barriers to the introduction of new information and communication technology
that might exist within your organisation. (All: N=350).
Note: The X axis represents the percentage of respondents that consider the barrier to be large.
COST OF CAPITALINVESTMENT IN NEW ICT
27%
37%
COMPLEXITY OFMANAGING CHANGE
30%
36%
OPERATIONAL EXPENSE BUDGETS IN ADDITION TO I.T. BUDGETS
25%
33%
LACK OF UNIFORM AVAILABILITYOF PRODUCTS
26%
22%
TIME TO ROLL OUT20%
31%
LACK OF BROAD EXECUTIVE-LEVEL SUPPORT
13%
15%
CULTURAL CHANGE REQUIRED29%
26%
FIGURE 18: BARRIERS TO INVESTMENT IN ICT PRODUCTIVITY LEADERS VS FOLLOWERS
PRODUCTIVITY LEADERS FOLLOWERS
28
4PRODUCTIVITY IMPROVEMENT
IN THE FUTURE
29
4.1 PRODUCTIVITY LEADERS EXPECT MORE GROWTH
The key differentiators of success between
Productivity Leaders and their peers in terms
of priorities, attitudes and investments are
reinforced in their different outlooks for the
future. Productivity Leaders are more than
twice as likely to be optimistic about increased
productivity levels over the next 12 months
(74% vs 33%). ICT investment plays an
important part in anticipated productivity
growth. Those who achieved productivity
improvements from their ICT investments over
the last 12 months, are more likely to anticipate
productivity increases over the coming year
(51% vs 39%).
Question: In the next 12 months do you anticipate that productivity within your organisation will increase
a great deal, increase a lot, increase a moderate amount, increase a little, or not increase at all? (All N=350).
Note: The Y axis represents the percentage of respondents that anticipate a great deal or a lot of improvement.
FIGURE 19: ANTICIPATED PRODUCTIVITY IMPROVEMENT OVER THE NEXT 12 MONTHS PRODUCTIVITY LEADERS VS FOLLOWERS
33%
74%
PRODUCTIVITY LEADERS FOLLOWERS
30
5CONCLUSION
31
CONCLUSION
Improving productivity remains a key priority for
the majority of organisations, as it was in our
TPI 2009 and TPI 2010 surveys. While there has
been slight improvement overall, there is still a
Productivity Improvement Deficit of 52%. This is
the difference between the proportion that rate
productivity as a priority, and those that measure
it and have achieved significant productivity
improvements.
By identifying Productivity Leaders –
characterised by measurement and tangible
productivity improvement – we can highlight a
number of important factors which appear to be
crucial in driving productivity.
The results show that Productivity Leaders
recognise the importance of a diverse range of
initiatives to help them succeed and, compared
to their peers, emphasise investment in customer
communications, ICT and process improvements.
In terms of ICT, there are a number of specific
investment areas that Productivity Leaders
identify as delivering ongoing productivity
improvements, including:
■ using broadband/IP network to deliver
business applications
■ improving data network speeds and broader
network coverage
■ improving access to, and sharing of,
information and resources across
different locations
■ improving use of emails and other
electronic messaging
■ improving automated business processes
and forms online
■ improving technologies to access business
applications and manage activities while out
of office
From an ICT perspective, Productivity Leaders are
better connected. They are:
■ more focused on whole of organisation
programs and collaboration between
groups rather than on programs aimed
at individuals
■ more likely to utilise ICT to create an
engaged and productive workforce
■ more likely to deploy ICT to connect with
customers, suppliers and partners
■ less likely to emphasise many of the
potential barriers to ICT investment
such as capital and operational expense
and complexity
Productivity Leaders now represent one in four
respondents compared to one in five respondents
in 2009 when the first TPI was released. This
improvement indicates that organisations can
learn from tried and tested strategies and
realise their own productivity potential.
The findings of the Telstra Productivity Indicator
2011 are clear: organisations must measure
productivity and also invest and manage against
those metrics if they are to achieve significant
productivity improvements.
Executives can review their approach to
ICT-driven productivity improvement by following
these steps:
■ Analyse: Review your ICT deployment strategy
against the business needs of your
organisation. Compare your strategy with
those of Productivity Leaders. Align with
current and future needs to deliver optimal
productivity outcomes
■ Target: Understand and prioritise how the
workforce interacts and how the organisation
collaborates with its customers, suppliers
and partners to target key areas that could
have maximum business impact from
specific ICT technologies
■ Invest: Ensure direct alignment between
key business metrics and the deployment
of ICT solutions
Further insights on Telstra’s approach to
productivity improvement along with case
studies in productivity leadership are explored in
Improve Productivity: Executive Insights.
© 2011 Telstra Corporation Limited. All rights reserved. ® Registered trade mark of Telstra Corporation Limited ABN 33 051 775 556. ™ Trade mark of Telstra Corporation Limited ABN 33 051 775 556.
All company or product names are trade marks or registered trade marks of their respective owners. Telstra retains ownership of all intellectual property subsisting in the contents of this document
and there shall be no unauthorised copying or distribution without the prior consent of Telstra. Telstra reserves the right to revise this document for any reason without notice. The information
in this document is based upon assumptions and forecasts, and reflects prevailing conditions and Telstra’s views as of February 2011, all of which are accordingly subject to change. In preparing
this document, Telstra has relied upon and assumed, without independent verification, the accuracy and completeness of all information available from public sources or which was otherwise
reviewed by Telstra. To the extent permitted by law, Telstra is not liable for any errors in this document nor any damage, loss or other liability (including without limitation direct, indirect, special
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About Telstra
Telstra is a leading provider of network-
centric communication and managed
services to large enterprise and
Government organisations in Australia
and around the globe. Telstra serves
over 200 of the world’s top 500 companies
through its international operations
that facilitate access to over 240
countries and territories.
About Sweeney Research
Sweeney Research was established
in Melbourne in 1972. Since then, the
organisation has grown steadily and
is now one of the five largest research
consultancies in Australia, with offices
in both Melbourne and Sydney.
Telstra Productivity Indicator
methodology
Since 2008 Telstra has conducted,
via Sweeney Research, an annual,
independent survey of directors, senior
executives and managers who have
an in-depth knowledge of the workings
of their organisation, providing a unique
insight into productivity and the factors
which influence it.
For the 2011 survey, 350 confidential
phone interviews were undertaken in
January 2011 to build a statistically
representative cross-section of Australian
leaders in enterprise and Government
organisations with over 200 employees.
The phone interviews consisted of a
questionnaire exploring respondents’
understanding of how their organisations
measure and drive productivity, their
attitudes towards new technology,
the impact of this technology on the
productivity of their organisation,
and their investment priorities.
TO DOWNLOAD THE LATEST TELSTRA PRODUCTIVITY RESEARCH, VISIT TELSTRA.COM/PRODUCTIVITYTO FIND OUT MORE, CONTACT YOUR TELSTRA ACCOUNTEXECUTIVE OR CALL 1300 TELSTRA
