Confidence & Austerity – reflections on 2014
People are always asking me how the “market” is for Interim Managers in my sector – I place senior management and board level interim executives in Energy, Utility, Transport and Construction settings. All that I can reflect is the activity I see, what I learn when talking to clients, and hear of through Interim Managers’ personal experiences.
The key descriptors for 2014 are “stop-start”, “patchy” and “frustrating”. There have been very busy periods and, indeed, things overall are much better than recent history. As a nation we do try to attribute swings in such markets to things like the Scottish Referendum, the upcoming election and even sporting events such as the Olympics and the World Cup. There is no doubt that these do have some effect, but are they causal or just excuses for inactivity? Do we have the appetite for growth now?
I believe that there is a more important factor, however – five years of having the word “austerity” rammed down our throats on a daily basis has made us far less likely to take risks and, more importantly, to look sensibly at the opportunities arising coming out of recession (to acquire, grow, enter new markets, develop new products etc.). Some people have noted that many Finance Directors have become very used to stopping projects being undertaken (probably quite rightly, too, in many cases), but are finding it hard to remove the austerity sign from above their doors and be more balanced in considering risk versus reward. Of course the key word is “confidence”. But whose confidence? That of market analysts? Of bankers? Or more importantly of the general populous, of consumers?
Of course this simplifies complex issues to quite some degree, but it seems as though now is the time to generally be more positive. Once more firms start to take the plunge, others will follow. Confidence should grow. Whilst we still need to be careful and cautious, we must balance risk and use the word “austerity” more sparingly.
As ever I welcome your views and comments.