Latest news – Staff rejecting workplace culture; More partners on the way; Pricing and competition the main challenges for firms

Workplace culture prompts staff exodus

About two-thirds of Australian businesses are losing employees because of a lack of workplace culture, according to the Australian Institute of Management 2016 National Salary Survey. Based on responses from more than 500 organisations across Australia covering more than 25,000 employees, the key findings include:

• almost two thirds (63.7 per cent) of businesses identify organisational culture as their biggest HR problem
• more than half (58 per cent) of the businesses indicate that learning and development of staff is also a HR issue
• more than half (54.6 per cent) raised concerns over staff retention
• it costs on average $26,410 to recruit a new employee, which is almost half the average national salary.

The survey suggests that about four out of five employees leave their role to look for a new challenge.  Younger employees want faster career progression and businesses need to focus on adding more value to the workplace other than job and financial security. It is critical that employers show employees there are opportunities for career advancement, while also focusing on training and development.

Firms set to elevate more partners

Australian law firms are determined to increase their rate of fulltime hires and elevate more lawyers to partner roles after a period of consolidation. This is according to an annual benchmarking study of the profession undertaken by accountancy firm Crowe Horwath in partnership with the Australasian Legal Practice Management Association (ALPMA). Legal firms from all states in Australia participated in the study, which found that 75 per cent of all firms surveyed expect to hire more fee earners in the upcoming financial year. The survey also suggests firms will not make any radical changes to deal with digital disruption, despite acknowledging the issue as a critical one for law firms to address. There is also no real move to increase marketing and business development budgets in response to external factors, with average spending on these activities stable at about an average 2 per cent of revenue across all firms. Based on the current and past surveys, firms are likely to maintain gross profit margins at 60 per cent, with costs steady at about 40 per cent of revenue.

Pricing, competition the big barriers

Pricing and competition pose the two biggest challenges for law firms, according to a new international survey. The LexisNexis Enterprise Solutions’ survey of more than 100 marketing and business development professionals in law firms indicates that respondents are optimistic about growth this year, but that pricing (for 52 per cent) and competition (for 46 per cent) are the biggest headaches. The key findings of the survey include: 62 per cent of respondents are proactively targeting international growth; 88 per cent of respondents are shifting their marketing and business development strategies and activities in an effort to win new business; and 94 per cent of professionals recognise marketing and business development as different functions that require different skill-sets.

The report, entitled Law Firms in Transition: Marketing, Business Development and the Quest for Growth, is based on responses from law firm marketing and business development professionals across the United Kingdom, mainland Europe, South America, Africa, Asia and Australasia.

The respondents believe that technology can help them to achieve their growth targets in 2016, with tools such as customer relationship management or marketing automation being the most likely to aid success.