Why should I use the LIFO ® Method?

Below are some interesting statistics that could be costing you money!

Recent reports have suggested that absenteeism represents a major cost for Australian businesses. A 2003 study conducted by the recruitment company Morgan and Banks found that sick leave was costing Australian businesses $2.56 billion a year.

A Turnover & Absenteeism study conducted by Hallis in 2003 – 2004, found that 42% of Australian workers admitted to faking sickies. They also discovered that happy employees who feel they have a comfortable workplace, have a good relationship with their boss, feel competent in what they are doing and who connect at a social level with their co-workers use much less sick leave than their unhappy counterparts.

The total cost of workers compensation claims in Australia for stress related conditions is estimated at over $200 million every year. According to the National Health and Safety Commission, work-related stress accounts for the longest stretches of absenteeism.

Stress can have a major effect on work performance. Some of the consequences of workplace stress include absenteeism, diminished performance, negative attitude and cynicism, decline in commitment and creativity, and a decreased ability to concentrate, learn and interact with other employees (“Workplace Stress”, PricewaterhouseCoopers Legal, 2006).

The Hudson survey entitled “Why Employees Walk: 2005 Retention Initiatives Report”, postulated that more than one third of workers expect to change jobs within the next three years. They also discovered that career advancement, relationship with their managers and training is more important than money in retaining staff.

According to an employment branding survey of over 600 Australian jobseekers by Hays recruiters (2006), in determining a company’s reputation as an employer, 68% of employees view treatment and support offered as ‘extremely important’. Also rated as ‘extremely important’ were the relationship between management and staff (65%), and training and development offered to employees (51%).

According to an international study by the Future Foundation “Getting the edge in the New People Economy” (2004), poorly performing employees cost Australian businesses $5.9 billion a year. The study also concluded the following:

• 15% of employees leave their jobs before they become competent.
• It takes an average of seven months for an employee to become competent in their role.
• Employers spend 12% of their time redoing or correcting mistakes by other team members.
• Managers believe the top 25% of performers are 2.7 times more competent than the bottom 25% of employees.
• According to Dr John Sullivan in “End ‘equal treatment’ today! Focus on top performers” (2004), top performers almost always exceed the performance of average workers by well over 25%. In fact, organisations that have estimated the performance differential between average and top performing employees have found that it is often 300% higher. Sullivan also found that managers typically spend 80% of their time with 20% of their team who are considered to be underperforming, and 80% of the profitable activities within their department come from 20% of their employees.