australian aviation industry - alaea · was the 2012 employee survey undertaken for qantas airways....
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2 AVIATION INDUSTRY EMPLOYEES SURVEY 2012
Why an Aviation Employee Survey? Employee engagement surveys are not a new concept; in fact most
employers in our industry have conducted them for some period of time.
The problem with conducting internal company engagement surveys is
that the results are just that – internal. Whilst data collected during this
process may be of some assistance, its real value cannot be determined
without a corresponding and measurable industry comparison.
In many cases the information obtained through the internal surveys are
never released to staff or shareholders. Instead those persons rely on
limited interpretation and commentary by Senior Managers. A case in point
was the 2012 employee survey undertaken for Qantas Airways.
Information collected lead to the following statements by the CEO -
“The ExCo team and I have reviewed our Engagement Survey results this
week. Our overall score was 66%, this was a 4% decline from last year,
and is a true indication of the incredibly tough year we’ve just been
through together.”
“The good news is that two thirds of our people are engaged and believe
in where we are headed as an organisation, and what we need to do to
get there.”
The above statement was met with surprise by staff who suspected the
66% related only to the number of surveys returned and this was being
used to justify support for change that may have been absent.
After consultation with Employees and Managers within the industry, it was
determined that a wider Industry based survey was required where similar
questions were put to those in the industry, the results to be made publicly
available for the benefit of Employees, Management, Investors and those
who patronise the businesses that form the Aviation Industry in Australia.
AND THE PARTICIPANTS WERE? No one company has the ability to conduct an Industry survey but there is
a movement that represents over 60% of those Employees. Professional
Employee Associations and Unions. Over 2750 (approximately half from
Qantas) employees participated in the 54 question survey from a wide
cross section of Industry Employees including –
Pilots,
Engineers,
Flight Attendants,
Ramp Services Staff,
Customer Services Staff,
Support Staff and;
Managers.
Employee Groups With Measurable Input to
Survey
• Qantas
• Virgin Group
• Jetstar
• Qantaslink
• Alliance
• Skywest
• Forstaff Aviation
• John Holland Aviation
• National Jet (Cobham)
• CHC Helicopters
• Bristow Helicopters
• Regional Express
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Employee engagement
What is it?
What are its benefits?
Research has shown that employee engagement is linked to a range of employee inputs to business success factors such as: • Employee performance/efficiency • Productivity • Safety • Attendance and retention • Customer service and satisfaction • Customer loyalty and retention • Profitability
The primary assumption is that if an employee is “engaged” the company gains the optimum performance input from the employee. A number of research papers have been written on employee engagement notably, W.A. Kahn in the early 1990’s as referred to by Rich, B.L. et al 2010: People exhibit engagement when they become physically involved in tasks, whether alone or with others; are cognitively vigilant, focused, and attentive; and are emotionally connected to their work and to others in the service of their work (Kahn, 1990). Put simply, engagement involves investing the “hands, head, & heart” (Ashforth & Humphrey, 1995: 110) in active, full work performance.” Herbert Kelleher, the previous CEO of Southwest, once made the following comment that summarizes the Southwest philosophy: “Who comes first, the employee, customers, or shareholders? That´s never been an issue to me. The employees come first. If they´re happy, satisfied, dedicated, and energetic, they´ll take real good care of the customers. When the customers are happy, they come back. And that makes the shareholders happy.” Joe Nocera reported in the New York Times May 24, 2008 in an article “The Sinatra of Southwest Feels the Love”: “There isn’t any customer satisfaction without employee satisfaction,” said Gordon Bethune, the former chief executive of Continental Airlines, and an old friend of Mr Kelleher’s. “He recognized that good employee relations would affect the bottom line. He knew that having employees who wanted to do a good job would drive revenue and lower costs.”
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Survey Groupings The survey questions were aimed at gathering employees’ opinions on how they felt about the management of the company and how employees were treated. The scores were then compiled to give an overall rating for each company on overall employee engagement. Whilst some surveys may be wholly about “employee engagement” the survey used was derived to get a broader picture more relevant to the aviation industry of employees’ opinions. From the survey questions asked the results were grouped by relevance under the following headings:
Communication
Safety
Perception
Management
Individual Communication – This grouping refers to the employee’s opinion of the effectiveness of company management’s communication in both directions, informing employees of developments and listening to opinions of staff. Questions in this group covered:
Providing staff a clear sense of direction
Sharing team goals into clear responsibilities for the employee
Recognition for a job well done
Building teamwork
Making the effort to listen to the opinions of employees
Keeping employees informed about matters affecting them
Encouraging employees to come up with solutions to work-related problems
Acting on previous surveys and feedback Safety – This grouping refers to the employee’s opinion of the effectiveness of company management in delivering the safest aviation safety outcomes for staff and passengers. Questions covered:
Obstacles at work to the employee doing their job well
Employee’s ability to sustain the level of energy needed to perform work
Employee being sufficiently informed about company's organisational behaviours of Safety, Service, Innovation, and Integrity
Management providing the tools and resources for employees to achieve excellent performance
Employee being concerned by pressure at work
The employee recognising that the company cares deeply about safety
Employees being comfortable reporting safety concerns
Management taking corrective action when safety concerns are raised
Management setting a good safety example
Evidence of deliberate violations of standard operating procedures
Employee’s belief that the Company learns from safety incidents
Employee’s belief that people are treated fairly after being involved in a safety incident
Senior management putting safety before profits
Survey Methodology
The Survey was compiled under license available on the surveymonkey.com website. The questions were modelled on existing airline/aircraft industry employment surveys to ensure the data returned was based on similar subject matter enabling valid comparisons by those who may be interested in using the information.Industry employees were encouraged to complete the survey through the website link https://www.surveymonkey.com/s/HQX65PV and by social media and contact with their employee organisations.
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Unlike Internal company surveys the concept of an Industry survey allows participants to answer freely without fear of repercussion from employers who may have access to an individual’s responses
Perception - This grouping refers to the employee’s overall perception of the company they work for. The questions related to the employee’s loyalty and commitment to the brand. Questions covered:
Belief in the goals and objectives of the Company
Support for the Company vision
Pride to work with, and in, the Company
Employee’s perception of the Company’s quality of products
Employee’s perception of the Company’s brand image
Employee’s perception of the Company’s prospects of improvement
Management - This grouping refers to the employee’s views of the company’s management performance. For example:
Employee’s belief that senior management are taking the Company in the right direction
Employee’s trust in the people running the Company
Employee’s belief that Senior management make decisions promptly
Senior management’s performance in providing leadership
Senior management’s performance in managing change
Senior management’s performance overall Individual - This grouping refers to the employee’s view of their opportunities in the Company and how they fit in. For example:
Confidence that they can achieve their personal career objectives within the Company
Getting along well with work colleagues
Knowing about possible career paths within the Company
Management making adequate use of recognition, other than money, to encourage good performance
Recommending their Company as a good place to work
Commitment by extra effort beyond what is required to help the Company succeed
Employees satisfaction with remuneration level
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Survey Demographics
Includes all Employees who Responded to
Survey Acknowledgement must be given to Employees of the following companies who responded to this survey however due to low return rates will not have their responses split for the purposes of company comparison
Airservices Australia
Cathay Pacific
Air New Zealand
Brindabella
Hawker Pacific
CASA
QDS
RAAF
Gate Gourmet
Network Aviation
Aeropelican
AMSA
Emirates
Aerocare
Express Ground Handling
Air North
Tiger
Toll Aviation
Subcontractors
Employees who responded to the survey workplace mainly centred in the major domestic ports in order of Sydney, Melbourne, Brisbane, and Perth.
7 AVIATION INDUSTRY EMPLOYEES SURVEY 2012
Age and Service
Approximately 81% of employees are aged 35 or over with the average age calculated as 43. Approximately 45% are aged 45 or over. Approximately 16% of the workforce are in the over 55 age group, who are entering the “potential retirement” demographic. This may indicate that within the next 10 years based on current industry growth predictions, and unless there is a downturn, at least 16% of the workforce may need to be replaced
Approximately 50% of employees who answered the survey have more than 10 years service with their employer and 28% have greater than 20. This indicates a relatively highly experienced workforce.
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Engaged employees work with passion and feel a profound connection to their company. They drive innovation and move the organization Not engaged employees are essentially “checked out.” They’re sleepwalking through their work day, putting time —not energy or passion —into their work Actively disengaged employees aren’t just unhappy at work: they’re busy acting out their unhappiness. Every day, these workers undermine what their engaged co-workers accomplish Source: Adapted from “Engaged employees inspire company innovation.” (2006, October 12). Gallup Management Journal
Rating Scales
Most individual questions that are presented in this booklet are based on a 1-5 rating scale with 5 representing the most positive answer and 1 representing the least positive. The rating scale is a common survey standard used across all industries. Example My manager does a good job at building teamwork Agree – 5 points Tend to Agree – 4 points Not Sure – 3 points Tend to Disagree – 2 points Disagree – 1 point Points are added together and displayed as a mean average.
Overall Engagement The measure of an employee’s engagement can be calculated using a number of different methods. This survey uses a complex set of pre-determined calculations that measure the overall engagement across 45 key questions. A majority of those questions are separated to allow measurement across the 5 distinct categories with some questions only applying to the overall score due to their general nature. The formulas used to calculate engagement work on the basis that the most positive answer would represent 100% potential with the most negative answer allocated 0%. Answers somewhere in between are weighted with those who are unsure adding a benefit of 50%. A simple question such as - Is an employee engaged or not? - is discretionary and subject to the views of the reader. In nearly all cases an employee could become more or less engaged. For the purposes of this survey we consider an employee to be engaged if that individuals engagement score is greater than 50%. An engaged workforce to be one that cumulatively scores above 50%.
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Safety The Aviation industry is regulated by the Civil Aviation Act 1988 and its Regulations, it sets safety and airworthiness standards for the Australian industry in compliance with International convention obligations pursuant to ICAO. Aviation employees live daily in a highly safety conscious industry and as is well known air disasters have the potential for massive loss of life and civil damage. The survey contained a number of safety explicit questions, grouped in the results reported earlier in this report under the heading “Safety”. One would hope that most employees in aviation would not respond in the negative i.e. would return a “Tend to Agree” or “Agree” response. Typical safety questions and responses across all companies were:
Employee Safety Questions Response Qantas Group Virgin
Positive Negative Positive Negative
My company cares deeply about safety 56% 44% 87% 13%
I feel comfortable reporting safety concerns 74% 26% 89% 11%
My company takes appropriate and timely action when safety concerns are raised 70% 30% 85% 15%
My manager sets a good safety example 70% 30% 87% 13%
I do not see evidence of deliberate violations of standard operating procedures 80% 20% 93% 7%
I believe my company learns from safety incidents 64% 36% 87% 13%
After a safety incident employees at my company are treated fairly 59% 41% 73% 27%
Senior management of my company put safety before profits 22% 78% 76% 24%
Whilst any response in the negative side of the ledger is of concern the Qantas Group employees surveyed
responses are extremely worrying. Particularly (a) Qantas “caring” about safety (where 56% of responses
were favourable versus Virgin at 87%); and (b) in regard to Senior Management putting safety before profits
(where Qantas responses were 22% favourable versus Virgin at 76%). In nearly all questions Qantas
Group employees had more than twice the number of negative responses per employee compared to
Virgin.
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Alliance Airlines
400 staff
Dedicated nationwide FIFO
Founded 2002
Headquarters Brisbane
26 aircraft Staff likelihood of recommending services to family or friends -
8 out of 10
Bristow Helicopters
374 staff
Mostly Oil and Gas services
Founded 1967
Headquarters Perth
34 Helicopters
Communicating with Staff
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Communicating with Staff
CHC Helicopters
325 staff
Emergency, Oil and Gas
Founded 1969
Headquarters Perth
38 Helicopters
Cobham Aviation Services Australia
(National Jet)
1600 staff
FIFO, Wet Lease, Customs
Founded 1989
Headquarters Adelaide
33 Aircraft Staff likelihood of recommending services to family or friends -
7.9 out of 10
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Airlines Overall
Engagement Order
1. Alliance 88.1% 2. Cobham 77.4% 3. Virgin 75.8% 4. Skywest 57.6% 5. Rex 39.3% 6. Qantaslink 36.9% 7. Qantas 32.1% 8. Jetstar 24.0%
Airlines
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Individual within the Company
Forstaff Aviation
680 staff
Aircraft Maintenance
Founded 1998
Headquarters Avalon Vic
Mostly Qantas contracts
Jetstar Airways
4200 staff
Regular public services
Founded 2003
Headquarters Melbourne
65 Aircraft Staff likelihood of recommending services to family or friends -
3.5 out of 10
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Individual within the Company
John Holland Aviation
Services
450 staff
Maintenance
Founded 2007
Headquarters Melbourne
Mostly Virgin, Jetstar, Tiger
Qantas Airways
27000 staff
Regular public services
Founded 1920
Headquarters Sydney
140 Aircraft Staff likelihood of recommending services to family or friends -
4.5 out of 10
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Perception of Company
Qantaslink
Part of Qantas’s 27000 staff
Regular public services
Founded 2002
Headquarters Sydney
58 Aircraft Staff likelihood of recommending services to family or friends -
5.2 out of 10
Regional Express
(REX)
1000 staff
Regular public services
Founded 2002
Headquarters Wagga Wagga
48 Aircraft Staff likelihood of recommending services to family or friends -
4.9 out of 10
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Perception of Company
Skywest
600 staff
Regular public services
Founded 1963
Headquarters Perth
18 Aircraft Staff likelihood of recommending services to family or friends -
6.4 out of 10
Virgin Australia
8000 staff
Regular public services
Founded 2000
Headquarters Brisbane
93 Aircraft Staff likelihood of recommending services to family or friends -
8.3 out of 10
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View of Management
Air Traffic Control
In our country is run by Airservices Australia. 100% of ATC respondents either disagree or tend to disagree that Management put safety before profits 100% of ATC respondents do not trust Senior Management
Cathay Pacific Australia
Staff likelihood of recommending services to family or friends -
6.6 out of 10
62% are proud to be in Association with Cathay
Pilots
58% of Pilots think they are fairly paid whilst 42% do not 22% do not feel comfortable reporting safety concerns
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View of Management
Network Aviation
Staff likelihood of recommending services to family or friends -
5.9 out of 10
57% of Network Aviation respondents think their company will get better over the next 12 months
Air New Zealand (Australia)
Staff likelihood of recommending services to family or friends -
9.2 out of 10
83% of Air NZ respondents are seldom bothered by pressure at work
Flight Attendants
54% of respondents were male and 46% female 62% of Flight Attendants think they are fairly paid whilst 38% do not
20 AVIATION INDUSTRY EMPLOYEES SURVEY 2012
Safety
Sub-Contractors
31% of subcontractors are seeking other work whilst another 46% would consider another job if it was offered 81% think they are fairly paid whilst 19% do not
Customer Services
Staff 14% have been with the company for more than 20 years 57% of respondents were female 62% included staff travel as the reason they stay with their company
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Safety
Qantas Engineers 60% have been with the company for more than 20 years 74% work beyond what is required to help the company succeed 15% would recommend the company as a good place to work 4% think Senior Management are taking the company in the right direction 2% have full or partial trust in the people running the company
Qantas Managers 53% have been with the company for more than 20 years 91% work beyond what is required to help the company succeed 42% would recommend the company as a good place to work 43% think Senior Management are taking the company in the right direction 25% have full or partial trust in the people running the company
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Qantas Pilots Rate their airline 3.5 out of 10 55% believe they have enough energy to get through the day 45% are over 44 years old 40% are proud to be in association with their company 24% feel uncomfortable reporting safety incidents 29% think that people involved in safety incidents are treated unfairly 34% think their company does not learn from safety incidents
Jetstar Pilots Rate their airline 2.4 out of 10 24% are over 44 years old 14% believe they have enough energy to get through the day 7% are proud to be in association with their company 59% feel uncomfortable reporting safety incidents 80% think that people involved in safety incidents are treated unfairly 72% think their company does not learn from safety incidents
Highlights The highlight is the ranking of Alliance Airlines, consistently at number one in all categories and displaying a high level of employee engagement. An indicator of why the Alliance employee’s response level was so high may lie in the Alliance Half Yearly results reported to the Australian Stock Exchange December 2012 for the last half of 2011: “Alliance Aviation Services Limited (ASX:AQZ) today reported revenue for the half year ended 31 December 2011 of $84.7 m million, a 45% increase over the previous corresponding period. Pro-forma EBITDA increased by 24% to $22.5 million. Alliance Managing Director, Scott McMillan said: “The underlying fundamentals of our business remain very strong, with our activity at historically high levels. We are seeing continued expansion of the mining and energy markets. We have a strong position in the growing FIFO market, as we are seen as a reliable operator, with market leading on-time performance. Owning our own fleet and maintenance capability across Australia enables us to continue to strive to improve this important differentiator of our business. Alliance has invested substantially in its heavy maintenance operations in Adelaide and Brisbane enabling us major maintenance tasks, ensuring we are in full control of our fleet.”
Jetstar was the worst performed airline ranking last in all categories except Management. Qantas Group Airlines followed similar trends with all categories of engagement below 60%.
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Questions Wouldn’t this survey be biased due to the large number of union member responses? The Airline Industry in Australia is heavily unionised with many operational departments containing 95%-100% membership across all companies. The response comparison between one company and another would not differ by union status as membership levels are similar nationwide. Access to this survey was available to union and non-union employees via various different means with less than 10% of responses linked directly to email addresses of union members. Has this survey been endorsed by Airline Management? No. Based on feedback we are aware that some companies are concerned that the results of this survey may conflict with public comments made regarding internal company surveys. Who will receive a copy of this survey? This survey will be available to investors, shareholders, employees, management, journalists, politicians and any other interested parties and the information within may be freely shared in whole or part. Will there be a follow up survey in 2013? It is intended that an Australian Aviation Industry Employee engagement survey be conducted annually. Preliminary results were presented to the International Transport Federation and the concept is likely to be adopted worldwide. Who co-ordinated this survey? The survey and its presentation were co-ordinated by the Australian Licenced Aircraft Engineers Association.
Reasons Employees’ Stay with their
Company in order of preference:
1. Pay
2. Work/life balance
3. Working in aviation
4. Work environment and team
5. Position matches interests
6. Staff travel
7. Lack of external career opportunities
8. Working for an iconic Australian Brand
9. Future career opportunities
10.The quality of their manager