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Melbourne, Tuesday, February 24, 2009

 

Eighty seven per cent of CEOs and top level executives believe their companies will survive the global financial crisis according to a survey released today by the Australian Institute of Management.

The vast majority of the 528 business leaders surveyed also remain positive about the capabilities of their companies and future prospects.

Most of the people involved in the survey said the Australian economy was well placed to withstand the full impact of the international crisis.

Despite this confidence, 20 per cent of respondents said their companies were looking at downsizing and retrenchments.

Skilled employees were the ones most likely to avoid retrenchment according to the survey. The ‘retention of skilled employees’ was listed as the number one priority by respondents in answer to the question: ‘How do you intend to best position your business during the downturn?’

The CEO of the Australian Institute of Management VT in Melbourne, Ms Susan Heron said the confidence of business leaders in the future of their companies and in the relative strength of the Australian economy were “welcome findings” from the survey.

“Companies need to have the confidence to invest in their business and recognise that skilled, well trained people ‘drive’ performance,” Ms Heron said.

Eighty one per cent of participants said investment in the development and retention of employees now will benefit their companies in the ‘medium term future’. Another positive indicator for employees was that 33 per cent of those surveyed said their companies would be increasing expenditure on professional development and training over the next 12 months.

The survey was conducted by the Australian Institute of Management during December and January and respondents were drawn from small to large sized organisations across the spectrum of Australian industry.

Just 11 per cent of survey participants said their companies had not been impacted by the economic downturn. Almost a quarter (23 %) of respondents said their company had been ‘significantly’ affected by the crisis. Fifty five per cent of those surveyed said their companies had suffered a loss in revenue since the downturn began.

“It is important that companies retain their key employees and exploit the opportunities presented by the downturn to recruit people with much sought after skills and experience who can fill ‘capability gaps’ in the workforce,” Ms Heron said.

“Talented ‘Gen Y’ managers, who can be groomed for long term executive roles in a company, will be prize recruits.

“Many Baby Boomers have had to postpone their retirement plans because of the downturn and the negative impact on superannuation investments. The one upside to this is that Australia’s skills crisis will be eased by boomers staying in the workforce longer.

“Downturns are an opportunity for companies to build market share and I am very encouraged that 71 per cent of survey respondents said they recognised this reality.

“To sustain a business and build market share, companies will need to have in place access to the necessary finance.

“Companies will need to look at what is their core business, look at revenue projections, working capital levels and recognise that ‘cash is king’.”

OTHER KEY SURVEY HIGHLIGHTS

-59 per cent of respondents believe Australia’s ageing workforce means there will be a long term shortage of skilled, well trained employees

-38 per cent said their companies had suffered a reduction in orders

-33 per cent reported a decline in request for quotations

-19 per cent said there had been an increase in bad debts

-65 per cent indicated that managing cash flow was now ‘more important’.

-25 per cent said access to funding had become ‘more important’.

The Australian Institute of Management is the nation’s major provider of management development, executive insight and research. It is an independent, not for profit organisation with more than 28,000 professional members and more than 5,000 corporate partners across Australia. The Institute is a federated organisation with each state managing its own operations.

http://aimvic.com.au/media/MR_240209.html

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