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People: Greatest asset or biggest headache?

Debbie Goodman-Bhyat

A people problem triple whammy has hit some of South Africa’s blue chip companies hard this year -and one expert says this could worsen in 2013.

Finding the right executives and talented leaders to drive growth, deliver shareholder value and ensure commercial sustainability for top organisations, while balancing the on-going need to comply with employment equity and other governance and transformation imperatives, has become an increasing headache for companies, according to top executive headhunters.

A survey, conducted by Jack Hammer Executive Headhunters, of companies in the banking, investment, insurance and FMCG sectors has revealed that the on-going struggle to attract the right people, retain good people and cut those who add overheads but don’t deliver, is damaging to business.

“The majority of those polled said they were clear on key strategic initiatives for 2012, but their major challenges related to human resources and their inability to reconcile staffing needs with business priorities.

“While companies can take steps to factor in slow economic growth, it is much more difficult to predict and rectify the impact of the big three – strikes, retrenchments and employment equity compliance. There is an on-going corporate struggle to attract the right people,” says Debbie Goodman-Bhyat, MD of Jack Hammer.

“Despite our massive unemployment issues, there is still a lack of skilled people to fill specialist positions and some Cape-based companies have the added issue of struggling with transformation imperatives as Johannesburg remains the preferred base for EE candidates.”

She says resourcing has a knock-on effect when it comes to achieving business goals: When budgets are not met because of inadequate people or gaps in executive teams, this impacts on business confidence and ultimately results in a lack of investor confidence, creating a vicious cycle that there is no quick fix for.

How did participants in the survey respond?

  • A participant in the insurance sector said: “We just don’t have the right people to do the sorts of things that need to be done. Implementing key initiatives for 2012 is behind schedule.”

  • A respondent from the investment banking sector said that they face “major challenges” when it comes to EE compliance, which in turn hampers their overall success.

  • A Cape-based corporation commented that “the one major challenge that impedes long-term strategy is that the pool of EE talent is based in Johannesburg with no interest in working in Cape Town. We would have more choice if we were a Gauteng-based organisation.”

And it’s not only transformation issues that have presented significant challenges to growth

The banking sector was rocked by waves of retrenchments throughout the country: “When other businesses do badly, it has a negative effect on ours. There is room for improvement on our 2012 implementation.”

A major player in the FMCG industry agreed that labour upheavals, like 2012’s bitter strike season, had a significant impact on their business, saying, “When people are striking, they are not buying.”

According to Goodman-Bhyat, the survey shows that many companies perceive people issues as the key variable holding business back, at a time and in an era when business sustainability is at its most vulnerable.

“In business, people can be equated to money. HR and labour issues are placing an immense strain on our economy. Companies need clear strategies to cope with staff problems and meet the challenges of 2013. What we have learned in 2012 is that it’s just not business as usual, “she says.

Author: Debbie Goodman-Bhyat is the founder and managing director of Jack Hammer Executive Headhunters.Debbie has received a BA.LLB from the University of South Africa. Debbie specialises in Executive searching in: financial services, retail, FMCG, engineering, resources, oil & gas, biotech and pharmaceuticals.