Delivering in a downturn - what does it take?
Overview
The UK is in the grip of the worst economic downturn for 70 years. After decades of growth, our managers face the most challenging business environment of their lifetime. But do they have what it takes to meet that challenge?
We set out to identify the key management skills and characteristics businesses need in order to survive the recession. To do this, we spoke to CEOs of over 50 UK businesses, and asked them to list the attributes they most need from their managers in these tough times.
The results were both inspiring and insightful. They provide a clear blueprint of the ‘ideal manager’ for organisations and individual managers to work towards, as they seek to build the skills and attributes that will enable them to deliver in the downturn.
Executive Summary
The research focused on two main areas: personal characteristics, and management skills and knowledge. These are the aspects of leadership and management that managers at all levels of organisations should be seeking to develop and display in the current climate.
Personal characteristics
A strong purposeful approach
During an economic downturn businesses have to overcome many obstacles. Over a third (35%) of CEOs said that it was most important for their senior managers to have a strong purposeful approach and be resilient, tenacious, disciplined, committed and driven. These qualities are essential to overcome barriers, move the business forward and make the most of new opportunities.
Innovating out of a recession
The ability to innovate and be creative is an imperative during a recession. Almost a quarter (23%) of CEOs said that it was most important that senior executives are quick to adapt to changing circumstances and can develop innovative and effective solutions to problems. They list characteristics such as innovation, flexibility, creativity and problem solving as highly desirable.
Maintaining a positive outlook
Reflecting their optimistic outlook, 17% of CEOs said that the most important personal characteristic a senior manager could have was a positive outlook. They want managers to be confident, optimistic, positive and have a cando attitude, and believe that there is a strong association between positivity and solution-driven hard workers with a winning mentality – people more likely to fight for a company’s survival.
Pessimism is a contagious and destructive influence, say CEOs. It paralyses organisational decision making processes and hinders chances of survival. Optimistic organisations are better positioned to take advantage of opportunities presented during a recession.
Management skills and knowledge
People management skills
Encouraging a positive, innovative and motivated workforce requires sophisticated people management and communication skills, and 27% of CEOs rate these as the most important skills for senior managers. CEOs need senior managers who can motivate, empathise and inspire others.
Fears of redundancy and the pressures of operating in a downturn stretch workplace relationships. The ability of senior managers to deal with these tensions is crucial to business survival.
Controlling costs and budgets
CEOs want a financially literate senior team that can exercise financial control and discipline, and demonstrate excellent financial management and budgeting skills. The ability to control costs and budget was considered most important by 22% of CEOs.
Managers must be able to analyse and understand financial data, and to use this information to make informed financial decisions. There must be a focus on the top and bottom line, internally on the business, and also externally on the financial health of suppliers and customers.
Building client relationships
The ability to build better customer relationships was rated the most important skill for senior managers by 11% of CEOs surveyed.
Managers must understand the markets they operate in and how the recession is affecting their customers. The senior team needs to resist the pressure to become too inwardly focused. The ability to seek out and capitalise on new business opportunities is crucial. CEOs need senior managers who can deliver, when the opportunity arises.
Conclusions
The research clearly demonstrates that there are specific and distinctive characteristics, skills and knowledge that will help managers steer their companies through a recession.
With so many CEOs confident of their SME’s prospects in the current environment, there is a clear consensus that the downturn could present a real business opportunity. But organisations looking to survive the recession, and hit the ground running when the upturn does arrive, would be well advised to focus on improving management and leadership competencies in the key areas identified by the CEOs in the research.