Survey captures management reaction to economic crisis

A new research report from Roffey Park, one of the UK’s leading executive education and research institutes, finds only 6 per cent of managers in the UK believe their organisation can thrive at this time and ride the wave of the global economic crisis.

Now in its twelfth year, the annual Management Agenda – a survey of over 850 managers – reveals the real impact the current economic climate is having on the workplace:

•58% of managers feel the economic climate has had a negative impact on their organisation;
•41% believe the economic downturn is one of the biggest issues facing their organisation at the moment;
•59% say that work pressure had increased as a result of the current economic climate.

Jo Hennessy, Director of Research at Roffey Park, says: 'managers are increasingly aware of cost spending restrictions in reaction to the economic downturn. Even those who do not report any impact as yet on their businesses are looking to cut costs.  It’s this and uncertainty in the workplace, which makes it difficult for managers to motivate and develop staff.'

Current challenges and reactions to economic downturn

The report is one of the first to capture management views before and after the October 2008 crisis. The findings show the key concern for all managers and employees is feeling under pressure at work, with 31% reporting increased pressure (August 2008 survey results compared to results of a follow up survey in November 2008).

However, this year’s Management Agenda reveals just 25% of organisations plan to downsize, compared to 36% last year. This suggests organisations have been less ‘gung-ho’ in their reactions to this credit crunch and are doing what they can to protect their core businesses and workforces, although the situation may change as the recession takes grip.

Jo Hennessy, Director of Research at Roffey Park comments, 'it’s clear that retaining skilled employees and top talent is one of the key differences between this economic crisis and the nineties. During the last recession, many organisations navigated their way through tough times by carrying out massive cost cutting exercises, including large scale redundancies.
'Our report indicates that managers have learnt lessons from the past – many continue to value their people and the contribution they make to the business. Instead, many managers are making changes to existing growth strategies – with many businesses putting a hold on outsourcing and acquisition activities to help manage financial costs and survive the difficult economic climate.'

Impact on managers

While pressure at work has increased, only a quarter of managers do not feel secure in their job or are more cautious in their work, and only a fifth are generally pessimistic about the future. Following the October crisis, the Management Agenda 2009 found a slight decline in self-perceived job security, a slight increase in work pressure, but no change in general levels of optimism. So while the majority of people are feeling ‘the squeeze’ of the credit crunch in one way or another, most do not anticipate a huge impact on their own employment.

Strategies for the future

The Management Agenda 2009 shows that leadership development is still the most common strategy for the future. The research finds strategic and financial success to be clearly related to the quality of their leadership, how well organisations manage change and the extent to which there is collective purpose among their staff.  Other strategies for the future include talent management, building strategic alliances and focusing on project management.

Jo Hennessy concludes, 'motivating staff to "go the extra mile" and supporting the business is vital if organisations are to endure these tough times; and the quality of leadership throughout the organisation will play a vital role. Retaining and engaging talented employees is crucial, not only to survive the immediate future, but also to avoid an intensified ‘war for talent’ after the recession.'