With yet another month of conflicting economic data and commentators' predictions, it is no wonder that many Australian companies are deferring strategic decisions and are just focussing on the short term.
The following reports appeared in the media on the same day (31 August, 2009) !!"The recession in global GDP has ended...those who were predicting a far worse downturn, including the IMF...are looking silly" - Alan Kohler, SmartCompany
"Not all signs are looking positive for commodity markets. The Baltic Dry Index, a guage of the cost of shipping commodities, has slipped more than 40 per cent since the start of June, signalling demand could be on the wane" - Australian Financial Review
"Despite a recent rally in financial stocks, the tally of failing banks (in the US) is rising quickly. Regulators revealed on Friday they had shut two smaller banks and a community bank, taking the 2009 tally of failures to 84" - Anthony Hughes, New York Times
"The upbeat sentiment accompanying the reporting season has been met with caution from experts, who warn on the amount of optimism being priced into shares" - Khia Mercer Australian Financial Review
For every optimistic commentator, it is possible to find a pessimistic one. And to confuse matters more, they are often relying on (and quoting) the same statistical data.
Back in the trenches, businesses are continuing to pay down debt and refinance loans - and to vigourously cut costs to defend profit margins in the face of falling revenues.
As we continue to negotiate our way through the Global Financial Crisis, this month's newsletter looks at how some companies are starting to plan for the future - and how other companies will place their reputations at risk through their treatment of staff, customers and suppliers during challenging economic times.
Best regards, Andrew
Despite the continuing economic uncertainty, many companies in Australia and the US are already starting to plan for the post-GFC world.
According to Career Builder and Robert Half's 2009 Employment Dynamics and Growth Expectations Report that was released this month, 40 per cent of US companies plan to hire contractors over the next twelve months and 39 per cent expect to add part-time employees.
Multi-tasking, initiative and creative problem solving were identified by US hiring managers as the most valuable characteristics a new hire can have.
In Australia the contracting market is beginning to bounce back - currently led by IT, sales and marketing - according to a 22 July report in CareerOne.com.au.
Of course, it makes sense that as companies emerge from their "recessionary" caves, they are seeking cost effective and low risk solutions. There is still a lot of international financial turbulence to contend with. And companies need to remain flexible if they are to weather the next twelve months. Rigid and bloated cost structures have been blamed for a number of recent corporate failures - and companies see the flexibility of contracting as the best answer to meeting their labour needs in the current environment.
Of course, Part Time Professionals are keen to assist any company looking for contract or part time executives, CFOs and Financial Controllers. We are NOT a recruitment firm - and represent over 270 independent Executives and qualified Accountants throughout Australia.
We do not charge any upfront recruitment fees and, by keeping our overheads low (No marble foyers here - Ed.), we can introduce companies to your next Executive, CFO or Accountant at a fraction of the cost of the big recruitment firms. Just give our office a call on 1300 79 1946 or visit our website at www.ptprofessionals.com.au.
Employee morale has fallen during the Global Financial Crisis, but only 26% of employers are aware of any decline according to a report by Hudson Australia: the Talent Tightrope: Managing the Workplace During the Downturn. In particular:
So, when the recovery commences, many businesses will be at risk of losing their good people. This will be of particular concern if those companies have also downsized and are working with a shoestring workforce.
And these same companies may find it hard to attract replacement staff during the recovery cycle. Social networking websites are full of stories of poor employment practices that will be read by prospective employees long after the GFC is over.
As Warren Buffett said: "It takes 20 years to build a reputation and 5 minutes to ruin it. If you think about that, you'll do things differently". When emerging from the GFC, a company's reputation as a preferred employer will be paramount if it has any hope of attracting and retaining the best staff.
During challenging economic times, honesty, ongoing communication, fair treatment and good ethics when dealing with staff are essential if a company is to retain its reputation as a preferred employer.
In the same way, a company's reputation with both its Customers...and Suppliers...can be made or broken during times of economic difficulty.
Suppliers will remember who paid them on time, who communicated in an honest and timely manner, and who they preferred dealing with during the tough times. They will remember the businesses they enjoyed working with - and they will also remember the poor payers, the tyre-kickers and the time-wasters.
Similarly, Customers will remember who continued to provide the best product or service, who maintained fair and reasonable credit lines during the difficult times, and who was open and honest to deal with.
As companies emerge from this recession, it is these experiences that will set the scene for the post-GFC business relationships. This is a great opportunity for good companies to really enhance their reputations...and for poor companies to lose them!
If Part Time Professionals can help your business reputation by introducing a talented Executive, CFO or Financial Controller to your team on a contract or part time basis, just give us a call on 1300 79 1946. Resumes are generally provided within 48 hours of your initial briefing!
And from the Every-Cloud-Has-A-Silver-Lining Department, we have this letter from the Australian Financial Review, BOSS Magazine dated June 2009:
Q. Thanks to the GFC/recession, I am now working a four-day week. This has proved to be a very big deal. Sure, the old salary has taken a bit of a hit but in fact, I feel like I have been delivered from a Gulag. I actually smiled at my children this morning and can now remember all their names again. My only problem is what happens when the economy picks up and my boss wants me to go full-time again?"
Just get the boss to call Part Time Professionals on 1300 79 1946 (Ed.)
About Part Time Professionals
Part Time Professionals™ is wholly owned and operated in Australia. Our principals together have over 40 years experience in public accounting and as CFO's and Directors in multiple companies - both listed and unlisted. They are members of the Institute of Chartered Accountants in Australia, CPA Australia, the National Tax Agents Association, the Australian Institute of Company Directors, the Financial Executives Institute and the National Institute of Accountants.
Our aim is to help companies source the most experienced CFO, executive and corporate accounting talent, in the most cost-effective way!
We are constantly updating our website, so take a look at www.ptprofessionals.com.au for more information or call us on 1300 79 1946 to discuss your needs.
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