Research · 2025

Business challenges, growth opportunities.

The five challenges Australasian SME owners struggle with most, how high performers score on each, and how to turn every one into growth.

Rate your business ↓Download the PDF

Published 2025 by HR Coach Australasia, the team behind STAR Workplace. Data from the STAR Workplace Program.

Employers across Australasia continue to navigate significant challenges while trying to maintain or grow their business. Times are tough, and the challenges are many.

STAR data from the last two years paints a clear picture of what employers are struggling with, and in doing so provides a road map to where the real opportunities are. It shows what employees are focused on now, and the gap between average and great businesses in the same sample.

If you own or help run a business, this research should validate many of your frustrations. More importantly, the solutions can turn those challenges into opportunities that strengthen performance and support sustainable growth.

The five critical challenges

Average STAR organisation score for businesses surveyed after September 2022.

Finding quality candidatesHigh performers 45%Low and average 39%
Tasks not getting completedHigh performers 64%Low and average 52%
Poor knowledge managementHigh performers 66%Low and average 54%
Poor workplace efficiencyHigh performers 74%Low and average 45%
Poor HR planningHigh performers 76%Low and average 50%

Challenge 1 of 5 · High 45% vs 39%

Finding quality candidates

The talent shortage HR Coach forecast three years earlier has become a stark reality. Several factors have converged:

Baby boomers exiting the workforce
Expanding employment opportunities
Reduced migration
Record-low unemployment

Quality candidates have become more selective, often fielding multiple offers and choosing workplaces that match their values. Meanwhile competitors actively poach top talent, adding retention pressure.

OpportunityDevelop internal talent

Rather than competing in a tight external market, identify and accelerate the development of employees who already understand your business and fit your culture. It's faster and more cost-effective than external recruitment.

Action step: Use Career Monitor assessments to understand what your key employees are thinking, and build personalised retention plans before it's too late.

Challenge 2 of 5 · High 64% vs 52%

Tasks not getting completed

Business owners report spending excessive time following up on incomplete tasks. That drain on leadership time comes from:

Lower experience and skill levels among staff
Ineffective delegation
Poor alignment with business priorities
Lack of ownership and accountability
Limited understanding of what drives value

OpportunityBuild ownership and accountability

Retain and develop capable employees, explain the 'why' behind tasks when you delegate, measure and improve strategic alignment, and create an environment where people own their outcomes.

Action step: Measure strategic alignment between business objectives and employee activity with STAR Workplace, implement targeted improvements, and reassess in 12 months.

Challenge 3 of 5 · High 66% vs 54%

Poor knowledge management

As experienced staff leave, businesses struggle to capture and keep critical operational knowledge. The result:

Decision bottlenecks as more issues are escalated
Inconsistent customer experiences
Repeated mistakes and inefficiency
Over-reliance on key individuals
Inability to scale

OpportunitySystemise decision-making

Rebuild internal capability by increasing employees' awareness of what drives the business and systemising decisions at the right levels. Businesses that make this shift become more resilient to staff changes and more efficient day to day.

Action step: Measure and improve management and employee culture drivers with STAR Workplace, starting development with managers and extending it to all employees, to shift from knowledge hoarding to knowledge sharing.

Challenge 4 of 5 · High 74% vs 45%

Poor workplace efficiency

Closely tied to knowledge management, inefficiency shows up as:

Daily activity misaligned with strategic goals
Duplicated effort and wasted resources
Inconsistent processes across teams
Reactive rather than proactive problem-solving
Too much time on low-value work

OpportunityAlign people with strategy

HR Coach's research shows an average 8% improvement in the first year when businesses measure strategic alignment and close the gaps they find. When margins are tight, that lift can be transformative. Focus on the five factors that separate high performers from average ones: management team efficiency, consistent culture across the business, effective employee feedback systems, proactive management of employee expectations, and individual accountability frameworks.

Action step: Measure strategic alignment with STAR Workplace, implement targeted improvements, and reassess annually.

Challenge 5 of 5 · High 76% vs 50%

Poor HR planning

Most businesses keep financial budgets, sales targets and business plans, but few develop a strategic HR plan, even though people are both their greatest competitive advantage and their largest controllable cost. That planning gap undermines every other objective.

OpportunityImplement an annual HR plan

Build a structured annual HR plan that integrates with your other business planning. It should cover organisational measurement and planning, HR processes and systems, governance and compliance, performance management, and workplace improvement.

Action step: Assess your business against the National HR Framework with STAR Workplace, build an implementation plan, and re-measure annually.

About the HR audit →

Turn your biggest challenge into your next opportunity.

A STAR assessment shows exactly where your business sits on each of these challenges, benchmarked against Australasian businesses.

Book an information meeting →View pricing