Manufacturing News

Companies are heading towards a recession warns business leader

THE CEO of a company that won three national best employer awards said today Australian companies should be careful not to respond to the current economic climate by pursuing savage cost cutting and downsizing.

Kevin Panozza, the man who founded and was the long term head of Australia’s major call centre organisation, Sales Force said he feared the negative attitudes of some companies might push the economy towards recession.

“In a downturn such as this, companies should be focussing on growing their business and building market share, so when the economic upswing happens they will be well positioned,” Panozza said.

“This can be achieved through improving their capability to acquire and retain customers.

“An essential requirement for a healthy company to stay that way is a high level of employee ‘engagement’.

“As soon as companies lose confidence in the business environment and their competiveness, employees lose confidence in the company and leave. And let me tell you, the best employees leave first.”

Panozza spoke about employee engagement to a capacity audience at the Australian Institute of Management’s ‘Managing the Future’ luncheon series at the RACV Club in Melbourne on August 6.

The CEO of the Australian Institute of Management, Victoria and Tasmania (AIM VT), Ms Susan Heron said employee engagement was a critical area of corporate performance.

“The long term reality facing our economy is the skills shortage.

“This is linked to our ageing population and strong ongoing demand for Australia’s resources. Indeed, the resources boom means the Australian economy is better protected from the impact of a downturn than most western countries,” Heron said.

“Our organisation’s performance indicators show companies are continuing to invest heavily in developing the skills and capabilities of their managers.

“For the six months to June this year, our figures show organisations invested more in training and developing their managers with us than for the corresponding period last year.

“In the second half of this year, the expenditure commitments are up slightly on 2007 figures.”

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