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Strength, positivity and innovation are key to surviving the recession, says report

A new report from the Institute of Leadership & Management (ILM) has warned that businesses will not survive the recession if they allow negativity and pessimism to seep into their managerial mindsets.

'Delivering in the Downturn', based on interviews with over 50 CEOs from small and medium sized enterprises (SMEs), was commissioned to explore the personal characteristics, skills and knowledge areas that CEOs look for in their senior managers during times of recession.

Over 80% of those surveyed expressed optimism about their business prospects. This sense of optimism extends to their view of the current climate as an environment in which there are still opportunities to be exploited, providing that their managers have the appropriate characteristics, skills and knowledge.

One CEO said: "In a recession there is a great danger of pessimism. This is very corrosive so we have to fight against it," while another echoed, "Pessimism gets in the way of productivity. In a recession people get bogged down in negative expectations."

The CEOs identify 'a strong, purposeful approach', the 'ability to develop innovative solutions' and 'positive outlook' as the three top characteristics they are looking for from their management teams during tough times.

Many of the CEOs interviewed said that that the current economic climate is making for more effective and efficient management, which they believe puts their business in a strong position for the future. "If you're lean and have the right people in place and are motivated, you are in a really good position for the eventual upturn," said one.

Penny de Valk, chief executive of the ILM, which commissioned the research, said: "We specifically chose to focus on medium sized businesses as history tells us that it is these organisations that have the greatest potential for growth out of the recession.

"The CEOs we spoke to acknowledge that management skills are being tested by the current climate, and highlight how important it is for managers to have

a leadership mindset. They must have: a strong purposeful approach; an ability to adapt and develop innovative and effective solutions to problems quickly; and a positive outlook, with respect to personal characteristics."

The research also set out to discover what particular skills or specific knowledge areas CEOs believe are essential for their managers to have during a recession.

Top of the CEOs' list are people management and communication skills, with just under a third (27%) of CEOs citing this as most important. 22% of the CEOs interviewed ranked cost control and budgeting skills at the top of their list of desirable skills and knowledge, while 11% of the respondents think building effective relationships with clients is most important.

Penny de Valk said: "The findings emphasise the need to continue focusing on leadership and management development, even during in a downturn, when budgets are tight. There is no margin for error during a recession. In a highly competitive economic environment, organisations need their managers to have every advantage possible.

"If they are to survive the recession and emerge well placed to grow and compete in the future, organisations need to focus on improving the core leadership and management capabilities identified in this report. Otherwise all that CEO confidence and optimism may well prove to be unfounded."

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