No matter how you view the current financial crisis or its causes there is no doubt that almost every business in Australia will be changed forever by the impact of the ‘credit crunch’. We have reached the end of a long period of sustained economic growth in which ‘growth at all costs’ became the mantra of business.

Business and consumer confidence is low. It’s likely that we are entering a period of little or no growth, in which the ‘correction’ in the markets and financial systems will see business face new, more demanding challenges than ever before. 

The pressure on business now means that it’s no longer possible to accept mediocrity from anyone. Organisations that were able to accept lower performance standards as long as the business continued to grow are now searching for solutions to problems that were previously hidden. And businesses that have allowed themselves to grow fat are looking for ways to improve productivity and reduce waste before they become ‘the Biggest Loser’.

• Leadership Development Programs that equip current and future leaders with the skills they need to manage the organisation through the tough times ahead are becoming increasingly popular. Astute business owners and leaders recognise that cutting back on development efforts will leave their organisation at the mercy of the market when the economy picks back up. They will end up paying more for outside talent if they don’t develop their bench strength now.

• Talent Management Systems that identify and encourage top performers are becoming an essential part of of business’ strategy. Succession planning remains a priority, with employee retention a key to protecting your business as your competitors become more desperate for the good staff they need to maintain or increase their own businesses.

The choices you make today must take into account both short- and long-term objectives. The immediate goals of controlling costs, minimising waste and increasing productivity need to be balanced against the long-term needs of your business as it emerges from the current crisis into the next period of economic growth.

Think about your Performance Management System and your Development Programs in terms of ROI. Will they give you the long-term return that you need? If not, what can you do to increase their effectiveness?

What do you think? Are the challenges facing your business now different to what they were? How are your priorities changing?

Let us know in the comments below and, as always, we’d love to hear your feedback.