After years of lip service about the importance of people to their organisation, a new survey by KPMG reveals that the economic downturn has elevated ‘people matters’ to the top five concerns for business leaders across Europe and the Middle East.
KPMG’s Business Leaders Survey – based on the views of 3,000 business leaders – suggests that managing and retaining the right people within the organisation is critical for 1 in 4 senior executives (24 percent). It is an issue only beaten to ‘top spot’ in the list of priorities by concerns over cash flow, with business leaders focusing on how they can change operations to become cost efficient (43 per cent), improve cash management (32 per cent), exploit growth opportunities (30 percent) and prepare for major business model changes (25 percent) dominating thoughts in the Boardroom.
Anna Marie Detert, director in KPMG’s People and Change consulting practice, says: “Last year, people issues didn’t even figure as a top ten priority for global business leaders; this year they rank in fifth place. The simple fact is that Boardrooms have realised that they cannot afford to lose good people. Their major challenges, as our survey proves, are cost efficiencies, improving cash management and finding new avenues for growth, yet each of these hinges on identifying new people capabilities to deliver on revised business models.”
Asked what managing and retaining top talent actually means, respondents to the survey suggest that ‘motivating people is their highest priority’ (43 per cent). A third (30 percent) also claim that offering development opportunities to their key people is critical. Given concerns over cash management, it is telling that just 12 percent still focus on pay and reward as a retention tool.
Anna Marie Detert concludes: “Clearly, lessons have been learned from past recessions. Without high-potential future leaders and individuals with business critical skills, it is simply not possible to drive through important initiatives that can restore or improve an organisation’s economic status. This fact is further validated by the 90 percent of business leaders who do not prioritize cutting the cost of the workforce.”