Investing in people (From Watford Observer)

Investing in people

4:18pm Friday 19th September 2008

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Business leaders believe that putting their faith in developing the skills and abilities of their workforce is the best way to reduce an organisation’s exposure to the risk of recession, according to a survey of senior business executives by global business performance consultancy, McKinney Rogers.

The survey, which encompassed Europe, Africa, Asia Pacific and the US, was designed to gauge awareness, perceptions and trends on the issue and what can be done to minimise the risk of a recession’s impact.

Key findings emerged when executives and business leaders were asked about the importance of tactical actions in reducing an organisation’s exposure to the risk of recession.

An overwhelming 78 per cent cited the development of their workforce as the key tool for this, while 73 per cent agree that moving into emerging markets that are unlikely to be affected by recession is also important.

Conversely, reducing the number of employees and reducing marketing spend were classed as the least important tactics in safeguarding against recession.

Other initiatives cited in the research were cutting prices to become more competitive and consolidating business premises and locations.

Commenting on the research, Richard Watts, regional partner for Europe at McKinney Rogers says: “Its interesting to see what business leaders focus on when recession is looming.

“Taking a strong leadership approach is such a key part of thriving during these times. Leaders need to instil the ability to re-energise, re-think and re-focus the business, using realistic targets.

“A company’s workforce is an essential tool in the business armoury when the going gets tough. Making productivity a focal point and rewarding those who rise to the top accordingly, will help reduce an organisation’s exposure to the risk of recession.”

When asked about the importance for businesses to have plans in place to reduce their exposure to the risk of recession, nine in ten business leaders agreed this is very important. Despite this high figure, a relatively low number have advanced plans in place, indicating that many companies might be caught short in the event of a recession.

Richard continues: “These results clearly highlight a real understanding across the business community of the value of forward planning in limiting the damage of a potential recession, as well as the tactical actions that need to be taken to achieve this. However, it is worrying that such a low number of business leaders and organisations have these advanced plans in place.

“Any time, whether a recession is imminent or not, it is vital that businesses have their house in order by having a clear focus and strategy in place, as well as ensuring resources are suitably allocated to provide the best return on investment. That way, when a recession does strike they will be able to stay lean and emerge stronger.”

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