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The body’s latest integrated report shows it cut nearly one-fifth of its workforce in 2023, double what was originally planned, eroding staff and member satisfaction.
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CPA Australia axed 121 staff, services for internal revamp: report
22 April 2024
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10 minute read
CPA Australia axed 121 jobs and halted member communications in the wake of a costly tech project and internal restructure, eroding staff morale and member satisfaction, its latest integrated report reveals.
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The reduction of about one-fifth of its 600-plus employees is double the 10-12 per cent target set by executives for the organisation's rolling redundancy program last year.
Insiders have suspected the clear-out was financially driven to curb a bloated $90 million wage bill while CPA Australia’s 2023 integrated report said the cuts were strategic, due to “efficiencies” gained from its tech project and a new operating model.
The project, known as the Member Management and Finance (MMF) project, involved a Deloitte-managed migration to Microsoft Dynamics 365 in July last year.
Overhauling “outdated” systems was necessary, CPA Australia said, since they were “not capable of supporting member and employee needs”.
But the integrated report admitted the scale of the project “caused disruption within the business while adjustments to roles and processes were made that were observable to some members”.
The disruption was also compounded by a new operating model, involving layoffs and role changes which CPA Australia claimed would “promote more collaborative ways of working and engaging with members”.
“The new operating model involved some difficult decisions as we introduced new ways of working, these changes meant that some people who have made a significant contribution to CPA Australia left the organisation and this caused some disruption for our current employees as roles changed,” the report said.
It added that “the MMF program and changes to the operating model saw disruption to normal business activities impacting some of the services delivered to members”, including a halt to member communications.
As a result, employee morale and member satisfaction have both taken a hit. According to the report, an employee engagement survey showed only 28 per cent of staff were “strong advocates” for working at CPA Australia, and around 40 per cent did not feel “psychologically safe” at work, an 8 per cent increase from the previous year.
The declining mood reflects concerns raised by insiders who last year described the organisation’s atmosphere as “despondent” and “grim” due to poor executive management and communication around the layoffs.
“Trust has broken down internally between the executive and general staff. It will eventually start to flow through to member services and member satisfaction,” one told Accountants Daily.
A member survey also revealed a decline in all KPIs in 2023. Overall member satisfaction dropped from 7.08/10 in 2022 to 6.87 last year, and opinions on CPD, brand trustworthiness, thought leadership and advocacy also fell.
CPA Australia said, “all survey results fell short of targets” but were “satisfactory and a significant improvement on the lows of 2017” when it was embroiled in a scandal over disgraced ex-CEO Alex Malley’s alleged conflicts of interest and $1.8 million salary.
The decline in member satisfaction also comes despite a price increase to membership and program fees, buoying receipts to $100.4 million, and overall revenue to $178.2 million, up from $169.9 million in 2022.
After making a $33.8 million loss in 2022, when the bulk of the MMF spending was made, a final round of investment saw CPA Australia post an improved result of a $1.9 million loss.
“The significant, $34.6m financial turnaround compared to 2022 was a result of a new operating model, a focus on reducing discretionary spend, lower MMF program investment and a moderate price increase,” the report said.
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