To avoid multiple rounds of cost cutting during a recession, companies should take action and make necessary changes early on.
That’s one of the lessons 29 percent of Canadian chief financial officers (CFOs) say they learned from the recent downturn.
It’s one of the findings of a recent study that surveyed 270 CFOs from Canadian companies with 20 or more employees.
Robert Half Management Resources (RHMR) developed the survey. It was conducted by an independent research firm.
CFOs were asked, to list the greatest lesson they learned from the recession.
Their responses were as follows:
• 29 percent said to take decisive measures more quickly to avoid multiple rounds of cost cutting;
• 16 percent said to make sure there is enough staff to maintain productivity;
• 16 percent said to place greater focus on maintaining employee morale;
• 14 percent said to implement more detailed succession plans; and
• 16 percent said there were no lessons learned, while two percent said they didn’t know or didn’t have an answer.
Rod Miller, a vice-president with RHMR’s Canadian operation, explained his theory as to why quick action ranked so highly.
“Cost-cutting measures, including staff reductions, may cause stress and uncertainty in an organization, often leading to decreased morale and productivity,” he said.
“By taking prompt action and not drawing out difficult decisions, companies can better manage employee concern.”