recession: time to seize opportunities and restructure for the long-term

South Africa may have been cushioned from the initial blow of the global economic downturn, but as the recession continues to deepen and broaden, many South African businesses are starting to feel the pinch.

For many businesses, in times of economic slumps, the knee-jerk reaction is to cut costs, downsizing to survive.

But Kelly Chief Operating Officer Gayleen Baxter says this is not necessarily the best option, particularly for the long run:

“Recessions are all about perspective and seizing opportunities. While it is inevitable that to weather the storm fundamental changes need to be made within an organisation, recessions also provide an opportunity to make an organisation stronger, to implement long-lasting solutions rather than short-term survival tactics,” explains Baxter.

One such solution is to seek a reliable and compatible staffing agency and incorporate flexible staffing as an integral part of the organisation’s employment planning.

“Staffing agencies can play a key role in enabling a company to quickly and effectively respond to market demands and technological changes. Unlike headcount reviews and recruitment freezes, a flexible staffing model will ensure that the organisation emerges from the economic downturn stronger and more efficient. A carefully managed flexible staffing approach will not only help maintain certainty and contain costs, but it also allows management to focus on its core business, confident that it will have the quality workforce necessary to help drive new business and embrace new opportunities. ”

It is however, imperative that an organisation does not rush into a partnership with simply any agency, but rather, that it carefully selects the right staffing agency to partner it through both turbulent and good times, as Baxter explains:

“Staffing agencies can make a critical difference to a clients’ business performance, and today’s more enlightened staffing agencies – like Kelly – are helping their clients to develop proactive, rather than reactive, strategies. A client-centric approach to staffing, whereby an agency is dedicated to creating programmes that fit each individual client, is also critical.”

The outlook may be bleak for South Africa’s immediate economic future, but, as Finance Minister Trevor Manuel reminded South Africans in his budget speech earlier this month, output growth is expected to improve in 2010, supported by the 2010 FIFA World Cup, lower interest rates and the R787 billion public infrastructure spending. And, as Baxter is quick to point out, no recession has lasted forever.

“The world economy will recover and it will be those companies that look forward rather than look back that will be better positioned to reap the rewards of the economic upswing,” concludes Baxter.