Article: Five areas to focus while preparing for economic recovery

C-Suite

Five areas to focus while preparing for economic recovery

The downturn has created a window of opportunity from an organisation and workforce perspective. It is important not to let that opportunity go waste. Deepak Malkani and Sunil Kumar, Accenture, elaborate on the five critical areas that business leaders should focus on in such times
 

Companies have expended a great deal of emotional and financial energy in recent months focusing on the most pressing issues of the economic downturn

 

Collaboration through knowledge sharing and teaming helps to generate higher levels of performance which is vital to being able to innovate and adapt

 

In a recently published survey by National Association of Business Econo-mists in the US, 80% of the respondents believe “the recession is over”.

Companies have expended a great deal of emotional and financial energy in recent months focusing on the most pressing issues of the economic downturn. As they look to an eventual turnaround, business leaders are going to have to dig deep into their energy reserves to prepare their companies for growth as the economy recovers.

Our research shows that there are five critical areas of focus for executives ready to renew their organization’s quest for high performance in a recharged economy.

1. Reposition your Workforce

Stressful times have a way of exposing weaknesses that have been lying unseen for many years. The recession resulted in workforce reductions for most organizations, which in turn exposed the fact that many organizations do not have a sufficiently detailed understanding of their workforce capabilities. Companies must engage in comprehensive workforce and skills planning. They need to ask some key questions to do an analysis of the capabilities they need versus those they have:

• “What are the workforce skills and capabilities our company needs?”
• “Where do the gaps exist?”
• “Who are the strongest, most strategic performers?”

Many companies cannot readily answer these questions. 

One of India’s largest infrastructure companies decided to invest in a learning academy to provide its employees with the skills and knowledge to build the capabilities needed to achieve current and future strategic goals. This intervention assumed importance since the company was planning to enter into newer businesses and did not want to look outside the organization to fill talent gaps. For example the HR academy helped facilitate up-skilling people management and functional/technical skills (recruitment, workforce planning etc.) for the HR department.

There was a conscious effort to integrate development activities into employees’ daily work and make strategic use of assignments and experiences to further develop new capabilities.

Accenture’s analysis has shown that there can be upto 35% return on training investments by improving employee performance and engagement.

2. Create a More Collaborative, Adaptive and Innovative Culture

The downturn has exacerbated many companies’ structural problems from an organizational perspective, for example, the silos that especially exist in large companies become exaggerated as executives and managers try to protect their turf. Talent, ideas, markets and customers are not adequately shared, so business synergies are lost.

If companies are going to be at full strength for recovery, it is critical that they have these mechanisms in place to connect people and ideas. Collaboration through knowledge sharing and teaming helps to generate higher levels of performance which is vital to being able to innovate and adapt.

A major telecommunications company has been responding to today’s economic challenges by augmenting the company’s existing formal learning programs with informal learning opportunities, and with social, collaborative capabilities.

From a technology platform perspective, the approach is equivalent to an enterprise-wide ‘YouTube’ system with a strong social dimension. The approach leverages Microsoft Sharepoint to enable employees to create, find and view learning segments (podcasts, documents and links), and also discuss and debate the content being created. Perhaps more important than the platform, however, is the attitude and learning culture that this approach creates across the organization. The free-form environment encourages people to experiment, innovate, collaborate, communicate and share their experiences and knowledge in engaging ways.

3. Develop a New Generation of Crisis-tested Leadership

The economic crisis is putting executives to test under exceedingly stressful conditions. That is the bad news. The good news is that this generation of leaders, as well as those who will become the next generation, may never have better conditions under which to test and improve their leadership skills. Some leading organizations are explicitly using challenging business environments to develop leaders.

A global software products giant with a large presence in India engaged Accenture to combine state-of-the-art training methodologies with critical on-the-job experiential learning to help India-based managers develop leadership capabilities to effectively lead globally distributed teams.

Using the principles of leading management research by Robert Thomas, Executive Director of the Accenture Institute for High Performance, the company created a program that combines individual coaching with a series of learning forums supported by ‘cohorts’. The research advocates using difficult or ‘crucible’ experiences to develop a personal learning strategy, in line with individual learning styles. This ensures that learnings from each cohort are passed on to the subsequent ones and the process remains sustainable.

Accenture research conducted internally between 2003 and 2008 has shown that companies that conduct structured leadership programs have seen their revenues grow over 1.5 times in the period and have seen their share prices treble, well above the average.

4. Build Integrated Talent Management Processes to Create Business Impact

Building a more agile workforce and organization requires integrated talent management processes and systems. Companies need a highly efficient HR organization and well-embedded processes that can develop employees from their recruitment to exit, and then optimize their performance through learning, performance management and aligned incentives. Without such capabilities, companies will not have the right people with the right skills and in the right numbers when they need them to advance toward high performance.

Two of India’s insurance firms partnered with Accenture to create integrated talent management solutions for their agent workforces with the aim of becoming more customer-centric. The process involved Accenture supporting the organizations’ efforts to identify and acquire better talent while focusing on their core business of creating products, processes and systems.

Accenture focused on scientific talent supply mapping which enabled the companies to target alternate talent pools, while at the same time industrializing the recruitment process to enable faster recruitment with higher quality candidates.
There has been an average reduction of over 30% in recruitment cycle time in both companies. Quality, measured in terms of hiring manager satisfaction, and sales value, measured as the number of first-year premiums sourced has also increased significantly.

5. Become More Employee Centric

A final imperative is to focus attention explicitly on the engagement levels of the workforce - especially the key talent and critical workforce needed to succeed in the new economy.

A recent Accenture global survey of nearly 3,000 middle managers found that the majority of these managers were staying with their current companies only because they felt they had little choice. Further 60 per cent of those surveyed said they would consider a new job but are not actively looking given current market conditions. Companies preparing for recovery are thinking about this challenge already. What can they do specifically to make sure they have an experienced, knowledgeable and engaged workforce? The Accenture Institute for High Performance has identified three keys to improving the engagement and productivity of the workforce:

• Build a Culture of Trust and Respect for the Individual

People are four times more likely to be highly engaged when leaders behave in trustworthy and predictable ways, and when they nurture a culture of trust within the organization. This is especially critical in times of uncertainty and change, especially in the wake of workforce cuts which often breeds insecurity and even ‘survivor’s guilt’.

• Create Meaningful Work and Career Opportunities

The research found that 72 per cent of people who believe that the objectives of their work are worthwhile and significant are engaged, whereas only 24 per cent of employees who see little significance in their work are engaged.

• Support Employees with Work, as well as with Work/Life Balance

Employees who reported that they had the resources they needed to do their jobs effectively including skills, information, experts, technology and tools were nine times more likely to be highly engaged than those lacking such resources.

Creating a ‘Ready to go’ Organization

As the economy begins to turn around and companies begin to plot their best strategic course, the ability to be agile will become increasingly critical. Our research and work with global companies has found that one of the defining characteristics of high performance is the ability to turn ideas into rapid execution. Critical to that ability will be an engaged, skilled and strategically aligned workforce.

The moment to act is coming soon. The question is: will your company be ready?

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Topics: C-Suite, Strategic HR

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