RMIT BUSM4546 Report: EY PAS Melbourne Challenges Analysis

This report conducts a thorough analysis of the business of Ernest and Young People Advisory Services (EY PAS) in Melbourne, diagnosing the causes of people-related challenges. These challenges include recruiting and retaining top talent, improving HR processes for a better employee experience, and identifying critical skills for both employees and leaders. The report begins with background information about EY PAS, followed by an external environment analysis using SWOT and an industry analysis using Porter's Five Forces. It then delves into an internal analysis to pinpoint the root causes of EY PAS Melbourne's organizational challenges, using the external analysis to provide context. The analysis reveals challenges related to talent acquisition, retention, HR process simplification, and the need for adaptable skills in a dynamic industry. The report concludes by summarizing the key findings and offering an overview of the situation, highlighting the importance of adapting to changes in the business world and the need for flexible and skilled employees.

Running head: BUSM4546
BUSM4546
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction..................................................................................................................................2
Background Information about EY PAS.....................................................................................2
External Environment Analysis Using SWOT............................................................................3
Industry Analysis.........................................................................................................................6
Internal Analysis..........................................................................................................................7
Conclusion...................................................................................................................................8
Bibliography...............................................................................................................................10

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Introduction
The aim of the report is to conduct a thorough analysis of the business of Ernest and
Young People Advisory Services (EY PAS) to diagnose the causes for the people related
challenges faced by the organisation. Some of the types of challenges faced by the organisation
in this regard include recruiting the best available talent and retaining the high performing
individuals. Other challenges include the creation of simpler HR processes which enhance the
employee experience received by the people. The critical skills needed off the people and the
leaders that the business needs of its people is another significant challenge faced by the
business. As a business involved in providing PAS, EY PAS needs to constantly hire new people
in the business while also enhancing the existing processes. However, this cannot be done
satisfactorily if the entity fails to retain some of the old people and build on their expertise. As
the costs of the business also need to be kept in control, constantly hiring new people would
result in increased costs for the business. These are some of the challenges faced by the business
in the aspect of people in the business. In order to understand this aspect, the report has been
structured in a logical manner. It begins by providing a background information about the
company and conducts an external environment analysis with the help of SWOT. It conducts an
industry analysis of the PAS industry with the help of the 5forces model and proceeds to conduct
an internal analysis of the situation. The causes of the EY PAS Melbourne’s organisational
challenges are restated and analysed with the help of the external environment analysis already
conducted. A conclusion of the situation of the situation is provided to suggest an overview of
the findings of the report.

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Background Information about EY PAS
The main roles performed by the entity are to provide a suite of services which support
the clients through period of transformation. They help the clients in designing an effective
system of internal control. The main areas in which services are provided by the entity include
change architecture, organisational design, culture and behavioural change and leadership
accounting. The EY PAS can be stated as a part of a shared service line between the EY
Advisory and Tax services operating within EY Melbourne. The Tax division performs various
services related to different aspects of taxation like corporate tax, indirect tax, International Tax
& Transaction services and Law Services. The advisory services provides services like risk and
performance improvement of businesses. Both these combined together come under the People
Advisory Services as they involve dealing with people and providing them with appropriate
advice related to people and the course of action to be taken by them. In the Advisory services,
the main aspect to take into consideration is the Workforce Advisory. This deals with aspects
like performance, talent and reward related to the people. Ever since it was first established in
2015, this branch of business has been constantly growing ever since. The PAS, as of 2020, has a
global network of more than 11000 employees operating in more than 130 countries. They play
an active role in offering their industry experience and professional skills to more than 2000
corporate clients operating across the world. This section of the business is mainly involved in
delivering Exceptional Client Service and integrates different service lines to provide end-to-end
solutions to people. Due to the constant changes occurring in the business world, businesses need
people who are highly adaptable to change and remain agile.

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External Environment Analysis Using SWOT
The main rationale behind performing the external environment analysis of the business
is to understand the opportunities available to the business during the course of the business and
the challenges it will face in their implementation. The main opportunities available to the
business are related to its diversification measures of the business. As the company is providing
services in a wide range of industries like mining, oil and gas and retail amongst others, it
becomes easy for the business to identify a new area and implement its services. The size of the
organisation and the expertise of the employees make it extremely viable to search for new
opportunity avenues in the business. As new employees are required to implement the expansion
opportunities, there are opportunities available for the entity to diversify itself as a business and
employ people from varied backgrounds. This not only helps the entity in becoming better-
rounded but also helps it to establish itself in more unfamiliar markets. However, the challenges
are also presented simultaneously from the opportunities made available to the business. The
expansion requires highly efficient people who will not cause any unnecessary harm to the
reputation of the business. Hiring such people and training them is a costly issue and involves a
significant outflow of resources. Its level of success also remains doubtful due to the constantly
evolving nature of the industry. Technological innovations and process disruptions make the
organisation constantly reinvent itself and require people to be consistently flexible at all times.
However, keeping the employees motivated at all times is a significant challenge for the
business. Retaining, managing and motivating employees while keeping the costs under control
is a significant challenge faced by the businesses. Identifying employees that harness the agenda
of the company is a significant challenge for the business. The HR process are another arena of
opportunity available to the business where the current system of operations can be made

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simpler. As the company continues to hire new employees of varied backgrounds with different
skill sets, designing a new set of HR guidelines which meets all of their requirements is a
challenge faced by the business. As the projects undertaken by the business are usually complex
and diverse in nature, it requires hiring of a set of people with a varied skill set as a part of the
business. Hence, the process of hiring new employees becomes challenging. The new employees
should be flexible enough to learn new methodologies which are agile and human centred to
thrive in the business. Not being able to find someone with an extremely varied skill set is a
threat consistently faced by the businesses. As the current market scenario enables the business
to evolve from business partners to trainers of clients, the requirements of the jobs also become
increasingly complex. The advent of new smaller firms with specialised knowledge make it
difficult for the company to keep track of all the changes occurring in the business. Hence, the
threat faced in losing out a niche market to pre-existing players in the market is significantly
high.
However, some of the external factors also act as significant hindrances to the
diversification opportunities available to the entity. The deportation laws in place in Australia are
extremely harsh and may make it difficult for EY to constantly hire people from diversified
backgrounds. Protection of human rights and rights of refugees is also a significant matter of
concern in the industry. Currently, the tax rate in Australia on corporate entities is charged at
30%. A chances of increased tax rates charged on large scale firm may make it difficult for the
expansion to take place at the desired speed. The increasing concerns about the natural resources
and global warming in many parts of the business are making some of the traditional businesses
irrelevant. Hence, the consulting firms may find it difficult to maintain a consistent market share.
The social environment of Australia is generally stable and there are people from many countries

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working in the country. Hence, availability of people from different cultural backgrounds with
diverse skillsets is not extremely difficult. The growth in the technological purchases within the
country is constantly increasing. Hence, adopting new technologies as a part of the business is
not a matter of significant concern for the businesses. The legal environment prevalent in the
country is also strict in terms of protecting the rights of the workers and privacy of the
businesses. Hence, these may not act as a significant hindrance to an entity looking to conduct its
business in an ethical manner.
Industry Analysis
The Porter’s five forces model is used in determining the impact of the five forces on the
business of EY PAS Melbourne. The threat of new entrants is not a major factor of concern for
the business due to the reach of the business and its existing scale. However, it may lose out its
business to smaller players in highly customised markets and needs to be vary of the threats
posed by them. The capital access and the technological innovations brought by the new players
is not quite significant and can be implemented as a part of the business. The bargaining power
of the suppliers is not significant in case of the businesses as the company tends to directly deal
with the clients and there is no need of middlemen in the operations of the business. Hence, the
company does not have to worry about it. The bargaining power of the buyers or the clients is
high as they tend to pay significantly high fees for the services. Due to the availability of other
substitutes amongst the Big Four, it becomes easy for the buyers to switch their choices. Hence,
the entity always needs to provide quality services to retain the buyers. The threat of substitute
products is very high due to the presence of significant competition within the industry. As the
switching costs are not very high for the bigger clients, it becomes easier for the substitutes to
take over the market position of EY. This should be avoided at all costs. The nature of the

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industry is of one which is growing consistently. As the product differentiation is also high, EY
PAS needs to constantly innovate to provide a wide variety of products to the businesses and
make them available to the businesses in the short and the long run.
Internal Analysis
The SWOT analysis is an important strategic tool which is highly useful in performing
the situational analysis of an organisation. As suggested by the name, the purpose of the tool is to
analyse the Strengths, Weaknesses, Opportunities and Threats faced by an organisation in the
short and the long run. As one of the leading consultant services providing company in Australia,
there are a wide variety of strengths which EY PAS has. Some of the strengths of the entity
include a highly skilled workforce with successful training and learning programs. The company
invests huge amounts in teaching employees more to ensure that it achieves more with the help
of the employees. The expertise of the company in entering new markets and in thriving in them
suggests that the company has a steady revenue stream achieved due to the process of
diversification. The returns provided on the capital expenditure suggests that the entity is
successful in undertaking new projects. The company has always maintained a strong
relationship with the dealer communities operating in the same industry. Hence, the parties with
not only promote the company’ products but also believe that they can attain maximum benefits
with the help of EY’s client services. The high level of customer satisfaction is also another key
factor which has enabled the business to sustain over the period of time.
The weaknesses faced by the organisation as a part of conducting its businesses in
Australia include the nature of the business in which it is operating. Procedures which are
developed by the company during the course of the business may not be useful for a long period

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of time. Hence, the constant need to innovate creates a gap in the industry in certain cases. It
allows the new businesses entering the industry to obtain a foothold in the market. This
limitation of not being able to tackle the competition from new players makes the company lose
some of its market share in specific areas due to the lack of sufficient investment in Research &
Development Activities. The lack of quick progress in tackling the challenges posed by the new
entrants also acts as a hindrance to the quicker growth of the business of the entity. Retaining
employees is one of the significant weaknesses faced by the entity. The high demands placed on
the employees to be extremely agile and adaptive to change makes it difficult for them to
continue operating in the same industry for a long time. Hence, it becomes difficult for the
organisation to retain them as a part of the business and motivate them to contribute significantly
at all times for the business. The marketing position of the company is not particularly clear. The
business model of the entity suggests that it is a mix of Advisory and Tax services. However, the
link between them and the roles expected from the new employees are not very clearly
mentioned in the description of the company. There needs to be a better explanation of the roles
played by an individual after joining EY PAS. Identifying the right people at all times is not
entirely possible and this is a weakness of the business. The risk of the new individuals not
performing up to the expected levels may end up adversely affecting the business and its
performance levels. The investment required implement new technologies in the business is also
very high. Integrating the new technologies and processes is a challenging aspect and makes it
difficult for the business to come up with satisfactory solutions at all times in the business. The
lack of diversity and sufficient female participation in the important activities of the business is
another weakness suffered by the business. While there are a wide range of plans looking to be
implemented, the lack of a more sustained effort is a worrying issue for the business.

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Conclusion
Based on the above discussion, it can be suggested that EY PAS has been extremely
successful in building a wide network in Tax and Advisory services over the years. It size and
reach across the world is significantly high. Hence, the existing plans of the entity make it well
placed to diversify into new areas of business and employ people from a wide range of skill sets
and ethnic backgrounds. Some of the issues faced in this regard are the legal environment and
the environmental concerns faced by the businesses. The size and experience of the company
make it easy for it to enter new areas. However, the uncertainty facing the modern day
businesses and the difficulty in retaining employees for a long period of time is an issue. The
availability of viable substitutes makes the industry extremely competitive and there is a need to
maintain standard quality in the business.

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