Red tape and interest rates are top concerns for company bosses

At a time of political and economic flux, both at home and abroad, businesses in the UK are facing uncertain times. It is during these times that the ability to successfully manage change within a business becomes all the more important.

A new report by Gateley Plc reveals the challenges and opportunities business transformation presents for UK companies. 

Andrew Buchanan, corporate recovery partner, and Michael Ball, employment partner at Gateley in Manchester, discuss the report’s findings.

RED tape has long been a major bugbear for businesses in the UK. Sadly, this doesn’t look like changing any time soon. Company bosses surveyed as part of our study into how UK businesses are implementing change and transformation said increasing regulation and the negative impact it will have on their businesses over the next three years is their number one concern.

The vast majority (94 per cent) of respondents said red tape will have an impact, with more than a third (36 per cent) saying it will have a ‘major impact’.

Also topping the list of concerns for businesses is the prospect of potential interest rate rises and a downturn in emerging markets. These external factors would appear to be having a negative influence on the attitudes towards transformation of business leaders in the medium to long-term.

But it’s not just external factors that are influencing company strategy. Internally there are challenges too.Gateley logo 2016

Our survey revealed that whilst more than a third (35 per cent) of business leaders said investment in people was a key strategic priority in helping to drive change, many are still finding it difficult to recruit the right people, with filling job vacancies and staff retention cited as two of the main barriers. This is particularly acute in manufacturing, engineering and construction, and will only be exacerbated by Brexit.

Part of the solution may lie in attracting more skilled workers from ethnic minorities or getting more female recruits into industry sectors traditionally regarded as predominantly male.

Businesses that embrace diversity and make it a pillar of their recruitment and retention policies are going to be in a much better position when it comes to tackling the growing skills crisis in the years ahead.

Andrew Buchanan GateleyWhen asked about setting strategic business priorities, 50 per cent of respondents said sales growth and profitability is their main aim over the next 12 months, with 47 per cent citing it as a priority over the next three years.

It’s unsurprising that the focus of many businesses remains on prioritising sales growth or profitability over the next 12 months.

However, in chasing short-term profits, there is a risk that some businesses are failing to invest in laying down the correct foundations to clearly establish a pathway to delivering growth and profitability in the longer term.

The fact that differentiation and productivity are seen as more important medium-term goals is perhaps indicative that businesses are focussing only on immediate short-term wins, rather than focussing on investing in longer term growth strategies.

For change and transformation within a business to be truly successful it needs to be the servant of the strategy a company is pursuing. Major change should always be in support of a strategic priority for the business and tightly connected to it, not the priority itself.

To download a copy of the report click here

For more information, contact Andrew Buchanan, partner, or Michael Ball, partner, Manchester.

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