Manufacturing Companies Bullish Yet Unprepared for Recovery
2009-07-27T00:00:00
International business performance consultancy, McKinney Rogers, announced today top findings from its Driving Future Growth: Thought Leadership Research report. Conducted by global research firm Ipsos MORI, the Report surveyed leadership team members from large and mid-sized manufacturing companies in the U.S. and Great Britain.
“This report is intended as a wake-up call to those many manufacturers who, like many of our respondents, have successfully hunkered down - cutting costs and scaling back investments - and are waiting for the storm to pass before returning to their old strategy,” commented Damian McKinney, CEO and founder of McKinney Rogers in releasing the findings. “They are confusing surviving the recession with being ready for the recovery and they will emerge surprised to find stronger competitors with improved products. It’s imperative that they take steps now to deal with this likelihood.”
As performance and leadership consultants, McKinney Rogers is interested in whether manufacturing businesses were able to react quickly, review priorities and implement effective measures when faced with the economic crisis. And of even more interest is: having implemented these measures, are businesses well placed to react rapidly when the recovery starts, as it inevitably will? Among the key findings from the report are:
- Firms are largely confident given the economic circumstances. Nearly four in five state it offers significant opportunities, with more than nine in 10 feeling long-term plans will remain unaffected
- Many are seeing an opportunity to cut supplier costs (39%), improve market share (33%) and strengthen the brand (18%)
- Companies are bullish and plan to develop new markets (32%) or take market share from competitors(30%) over the next 18 months. Almost four in 10 feel it is the ideal time to develop or launch new products
- Reasons for this confidence may stem from the foresight many claim to have had over the last two years. The majority (56%) say that they predicted and saw the recession coming at least before Summer 2008, with most taking initial measures such as cost-cutting and redundancies
- However, for all the ‘fighting talk’, it has to be noted relatively few have taken steps so far. Only around one in seven have invested in new technology and products (12%) and R&D (12%), and only 4% have addressed strategic goals/programmes
- ‘Clearly written’, ‘detailed’ and ‘succinct’ are the main ways respondents view their business plans – which serves to highlight the strength of feeling towards them overall
- Adapting to changes was seen as the biggest challenge currently. Aligning the whole organisation is seen as vital, and over eight in 10 feel senior management is doing an effective job in communicating the message
- There are also substantial numbers that see further difficulties ahead – one third (32%) see working in silos and gaps in the skill sets of operational management (40%) as issues.
All interviews were conducted over the telephone between March and May 2009 by leading global research firm Ipsos MORI. Large firms consist of 20,000+ employees, mid-sized firms consist of 5,000-19,999 employees.
“For many businesses, when the upturn happens it will still be a very different and tougher market characterized in the West by chastened banks, indebted governments, wary investors and poorer customers. Competition from emerging markets will continue to become ever-more sophisticated, while the opportunities will continue to grow rapidly,” McKinney concluded.
About McKinney Rogers:
McKinney Rogers is a global business performance consultancy, with operations in the UK, Europe, Africa, Asia and the US. In partnering with its clients, McKinney Rogers strives to continually add value, by focusing on driving business performance and delivering sustainable growth year on year. Its Business Performance Solutions take business from strategy to execution through the rigor of robust processes and behaviors.
McKinney Rogers works with a number of global clients including Diageo, Pfizer, Wal-Mart and Thomson Financial Services.
Visit McKinney Rogers’ website at www.mckinneyrogers.com