British companies are being forced to ditch long-term business strategies in favour of a Now Management short-term approach to running their businesses, often driven by the demands of shareholders and financiers.
But the Now Management Report by Executives Online, the UK’s leading interim management and fast-track executive recruitment specialist, reveals that cost cutting moves to rein in business plans could result in firms being poorly managed.
Executives Online found that:
30% of companies now plan on a six month or quarterly basis
25% of firms now review budgets more often than annually
17% of companies only invest when there’s a guaranteed return within two
years
15% of firms say running their business is like managing a series of
projects
The reason for this approach is simple - money. According to the Now Management Report, 11% of firms say strategic decisions are made to satisfy the City and investors, rather than customers, where as 10% of companies say financiers are now driving their business strategy.
But short term planning may be harming British firms, with many companies believing their management practices are suffering as a result. 38% of managers feel they could be better at communicating their business vision, 26% say they could improve their strategic planning, 25% feel they could show more leadership and 24% believe they could be better at inspiring their workforce.
Now Management is also limiting the skills available within companies, with 20% of businesses now keeping their permanent staffing to a minimum and 14% of firms slimming their senior team down to a minimum.
As a result many companies have had to become more flexible in their staff recruitment, needing to rapidly find senior staff for projects or to solve issues within their business. The report found that 13% of firms are increasing their use of temporary and contract staff - but almost half
(47%) have employed a senior manager on a short-term or temporary basis over the last 12 months, with 26% of firms setting aside budget purely to fund their interim management needs.
Executives Online found that some of the main reasons for employing senior managers on an interim or temporary basis were to provide specific short-term expertise (51%), to strengthen a project (46%), to accelerate a project (27%) and to manage a major one-off project.
Norrie Johnston, Managing Director of Executives Online, says companies should not lose sight of the importance of good managers in their drive to short-term planning. He says: Whether we like it or not Now Management is a fact of life for many companies today. But our report shows that many managers are in danger of losing grip of their strategic business vision as they are forced to grapple with the day-to-day pressures of a short-term outlook.
The proof is the growing demand for senior, highly skilled managers to head up short-term projects or act as trouble-shooters. But for this approach to be successful companies need to become more flexible in their recruitment policies - ironically, they have to develop a much more long-term approach to short-term management.
Management Skills Suffer As UK Firms Take A Short-Term Approach
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