Business leaders face challenges every day. From finding new customers to keeping pace with technology, complying with regulations or planning an exit strategy, there is always a challenge to be met. So there was never going to be a shortage of responses when asking business leaders and decision-makers to identify their top three challenges or concerns.
But the question, which was put to 200 business decision-makers as part of the research behind Price Bailey’s recent Inside the Minds of Business Leaders 2017 report, identified two key issues as the main causes of concern.
The first was the problem of how to find and keep the right talent. More than a third of business leaders (36%) cited this as their toughest challenge, while 60% placed it in their top three concerns.
It’s an interesting problem, because the recruitment dynamic is changing totally. What the next generation of employees want from a job is very different – quite often people are looking to make career moves every two to three years – and what they want from an employer has also changed.
They are not looking just at salary but at the much wider package, including flexible benefits, training opportunities, and areas and initiatives they can get involved in through the workplace such as volunteering and community projects.
Responding to changing career priorities
It’s something that businesses, as employers, need to recognise and respond to, and it’s certainly something we’ve recognised at Price Bailey. Being able to recruit and retain the right people is now part of our business strategy.
Just to attract skilled people, you need to start thinking about what makes you different – why would a potential employee want to work for you rather than another company?
We know that as a business we can’t compete on salaries with some of the really big national and multi-national accountancy firms. But we can compete in areas such as flexible working and benefits, volunteering opportunities, and the wider package, all of which make the company an interesting place to work.
So while money is still important, we know it’s about much more than just cash; and having recognised that ourselves, we can definitely help other businesses to look at that part of their strategy moving forward.
Outsourcing comes with a warning
Another element of the talent hunt challenge is the opportunity to focus on specialist skilled staff who are crucial to the development of your company, while possibly outsourcing some of the more general roles.
However, this comes with a warning. Many business sectors – and financial services is a good example – have combined outsourcing with technology to reduce the amount of staff needed in service delivery. But as a result, the service that many customers get from banks, building societies and financial institutions can sometimes be terrible, and it can often be difficult to actually talk to another human.
So there needs to be a balance between outsourcing, reducing staff through the use of technology, and providing good customer service. And again, how you do that comes back to good business planning.
Mitigating against currency risk
Alongside attracting and retaining talent, the other key business concern highlighted in the report was the weak pound. It was perhaps surprising to see this identified by so many businesses as one of their top three concerns, but I think Brexit has really focused people’s minds on the issue, particularly because of the nature of the currency movement after the referendum.
The pound lost 18% within a couple of days, a very big change over a short term. Normally, currencies will move up or down slowly over a period of time as part of a trend, rather than such dramatic and sudden fluctuations.
On the financial planning side, the strength or weakness of the pound makes a huge difference to the way people invest and their exposure to the currency markets. But from a business perspective the main focus is on imports and exports, and obviously depending on which way the currency moves, it can be either a real boost or a bit of a disaster.
Not enough businesses that buy resources or products in other currencies actually talk to foreign exchange experts about their currency position, and what steps they could take to mitigate some of the risks. By getting expert advice, they could considerably limit the damage if currency fluctuations go against them.
But I think a lot of businesses still aren’t having those conversations with the right people. There are foreign exchange experts who we work with on a regular basis and who specialise in these areas, so there’s an opportunity for many more businesses to address some of their concerns.
Looking at the wider market position, we know that currently there’s not a lot of confidence in the UK markets and UK economy, and fund managers at the FTSE 100 / FTSE 250 level have largely pulled out of UK equities and the UK market because of the uncertainty.
That said, there are a lot of positives in the economy. There’s almost zero unemployment, and a lot of businesses are still performing strongly – we see a lot of clients doing well at the moment. We just need to carry on meeting the challenges, while guarding against the clear danger of talking ourselves into more difficulties.
To find out more about meeting business challenges, contact James King Partner and Managing Director of PB Financial Planning Ltd, using the form below. You can find out more about Inside the Minds of Business Leaders 2017 through our interactive digital report or download the full pdf here.
We always recommend that you seek advice from a suitably qualified adviser before taking any action. The information in this article only serves as a guide and no responsibility for loss occasioned by any person acting or refraining from action as a result of this material can be accepted by the authors or the firm.