When times are going well, it’s all about the people. When times are going poorly, it’s about revenue.
Lean economic times serve as a wake- up call to organizations, their leaders and employees to discover the real priorities. Unfortunately, when the economy sours, engaging the best talent takes a back seat to finding new sources of revenue, according to a recent survey.
Adecco asked 200 leaders to list their priorities during an economic slowdown. The first priority was generating revenue and the second was pursuing growth opportunities.
Leaders said that during an economic downturn, generating revenue becomes the top priority compared with the fourth-highest priority during periods of economic growth. Recruiting and retaining talent drops from the top spot during growth periods to the sixth spot during a downturn.
A clue as to why priorities shift dramatically based on economic conditions is contained in the answer to another question in the survey about the most difficult workforce issues. The top response was leading through periods of change such as a downturn or organization restructuring. The next highest priority was managing workers in Generation X and Y.
Rich Thompson, vice president of talent management at Adecco, says he was discouraged by the results which reflect a growth through cutting mentality at many organizations. When times are good, organizations grow through their people but they become mere numbers on a balance sheet when the economy goes sour. Not all organizations follow along such a predictable path.
“At Toyota when times are slow, instead of cutting, they pull people offline and put them in the classroom,” Thompson says. “Now is the time to invest and improve the skills of your key people.”
Unfortunately, that is unlikely to happen as he readily acknowledges that during a slow down training is one of the first candidates for cuts.
In the report, Adecco asks rhetorically whether organizations are rewarding leaders for financial success or for embodying leadership qualities. The nature of the question suggests that successful leaders are measured based upon the balance sheet while leadership qualities such as promoting talent are merely lip service.
The flawed leadership model is not the fault of individual leaders who identified a sharp contrast between skills deemed important and skills that are most rewarded such as being able to ability to motivate and manage people. Yet the most rewarded skills are keen decision making and financial acumen.
“Corporate America is so focused on the investor which creates impatience,” Thompson says. “There’s no long range planning. They’re not investing in the talent that got them there.