All of us are to some degree influenced by the dramatic turn of events affecting the world economy – especially those businesses in the UAE and around the world which are under considerable pressure to retain cost-conscious customers.
Irrespective of whether you are managing a team, a division or a company, you will be under the gun to do more with less, while at the same time trying to maintain employee motivation and focus.
The Response to Recession
As the economy moves unsteadily on the brink of a recession, inevitably, among the first victims of corporate cutbacks will be the elements most vital to a robust talent management strategy. A few examples of such strategic moves and their impact:
- Budget Cuts: HSBC cutting budgets on recruitment, entertainment and travel. Derailed by the Chinese slowdown, the giant bank aims for planned cost cuts as an attempt to face poor performance in Asia.
- Lay off employees: British Petroleum announced plans to slash 4,000 jobs in exploration and production due to declining oil prices. To touch on stats, the company plans to shed 10% of the total workforce over three years.
- Spillover effect: Companies in the oil and gas industry in the UAE decreasing their hiring efforts to survive the downturn. This also leads to high concerns that there could be job cuts in other sectors such as retail and hospitality in Dubai.
- Stress-producing event: Financial crisis can negatively affect an employee’s psychological state, health and work performance.
However, such moves will be short sighted because the need for talent has never been greater. Companies that deal with economic slumps by cutting back too drastically on talent may find themselves unprepared for the long term.
The Underlying Issue: Managing Talent
In such trying times, the first, almost instinctive reaction of management is to reduce expenses by cutting salaries and jobs. For that reason, many companies place Talent Officers or HR Managers squarely in the middle of their turnaround plans.
However, the most pressing issue is the lack of talent management during an economic uncertainty or stagnation. In an environment of recession, every difficulty that emerges can demoralize even the best of employees. Their experience, talent and skills might not be enough to face the challenges.
Therefore, it is important to have on board people-sensitive managers who understand the importance of recognising and fully utilising the knowledge and unique skills of each employee. The dire need for motivation in the workplace under such demanding conditions is more important than ever, in order to mitigate potential reduction of productivity and to achieve operational excellence.
Let’s not forget, all carrots don’t look the same – especially during an economic downturn where the concerns are of a different nature: forced early retirement, change in one’s financial situation, the duration of unemployment, decrease level of income and fear of losing one’s job.
Instead of paying lip service to common phrases such as ‘people are our most important asset’, organizations should demonstrate that they are committed to looking after their employees during tough times, by investing in them through implementation of training and development programs, for instance.
Recession: an Opportunity
Investing in human capital during a downturn is, in most cases, considered a luxury. Hence, recessions offer the perfect opportunity to reach out.
When financial resources are scarce, the means to advance the company is through employee engagement and commitment. Utilising the maximum potential of one’s employees is an effective way to not only stay afloat but propel the company to gain a competitive advantage.
The effect a recession has on employees cannot be mitigated through one technique alone; rather it requires a combination of tactics. Managers may use various approaches, – one effective method being Training and Development.
Evidence of Demand
A workforce with low absenteeism and turnover rate is crucial for a successful business, especially during an economic slump or during road to recovery.
- According to a study of 100 HR managers from ILX Group, an internationally recognized leading provider of professional learning and consulting solutions, 51% reported boost in employee morale as a key reason to conduct training.
- Another study by the ASTD (American Society for Training and Development) of over 2,500 companies with well-developed training programs highlights 24% higher profit margins and 218% higher revenue per employee.
The Importance of Training
Attracting and retaining talented and highly skilled staff is fundamental for those operating in competitive industries such as, Oil and Gas, IT, Pharmaceuticals, Banking and Financial Advisory, and Fashion.
Economic downturns demand fresh thinking, new ideas and innovation, which are most likely to be found outside your industry. What we do know is that those most likely to thrive in the current environment are those with resilience and high levels of self-knowledge and self-worth.
Strategic investments in your talent ensure the company is able to cope with current challenges and while readying itself for the return of better times. This is where corporate training in Dubai significantly contributes to an organization’s talent management efforts.
Companies can benefit from sustained investment in training and development in many ways – because the natural defensive barriers we all carry around at work can be dropped during dire circumstances such as facing a financial crisis.
What can companies do to stretch their Training & Development budgets?
- Seek out corporate training firms in Dubai who can address multiple topics instead of hiring different trainers for each topic.
- Enjoy free concessions by offering multiple enrollments to corporate training in Dubai. In addition, get better pricing if the sign-ups are higher.
- Make it part of the deal that employees privileged for outsourced training are required to return and share their learning outcomes with their peers and colleagues.
- Seek out not only training you require but perhaps additional needs such as Effective Sales Management, Digital Marketing Essentials, Executive Coaching and so on.
- Ensure that certain avenues of corporate training in Dubai are always outsourced. This way, you are equipped to look outwards in terms of best practice rather than remaining inwards-focused.
The Way Forward
Recession or not, talent is more important than ever. As noted, the temptation for management during a recession is to slash training and development budgets. However, it is smarter to do just the opposite although this may sound counter-intuitive during a downturn.
The bottom line is that while the recession will eventually end, the fierce competition for talent is going to be a business challenge for the foreseeable future.
It is two-fold: The organization invests in talent management, such as by implementing training and development programs for employees to boost morale and reinforce positive motivation. In doing so, the effects of an economic downturn on employees as well as the organization along with positive motivational approaches, have the potential to strengthen organizational performance, even in the face of a major crisis.
If you are looking for corporate training in Dubai to motivate and boost employee morale, ISM Dubai offers a variety of courses to suit your needs and budget. Get in touch with ISM Dubai for more information.