Focus of business leaders shifts from cost-cutting to growth

Study signals private sector confidence in Irish economic recovery

Business managers have adopted a greater focus on investment and bumped recession-inspired cost-cutting down their list of priorities, a new survey by change management specialists IndEx Partners suggests.

According to its study of the attitudes of senior business figures in 214 companies in Ireland, six in 10 executives believe the key driver of change has shifted from cost-cutting towards gearing the organisation up for growth.

IndEx said the finding was a signal the private sector was confident an Irish economic recovery would take hold.

The main driver of change over the past five years in the surveyed organisations was cost-cutting, which was cited by 40 per cent of respondents, followed by operational efficiency, which was identified by 19 per cent. Budget shortages were the biggest barrier to business change over that period, the research indicated.

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“The fact that business leaders are now focused on creating new opportunities for growth is obviously encouraging,” said IndEx Partners general manager John Kelly.

“Winning the ‘hearts and minds’ of people across the organisation is a critical success factor. People have to, at a personal level, embrace the possibility of change.

“This is where leadership comes in. Leaders must have the capacity to articulate a vision, create a compelling case for change, and to inspire people with a sense of urgency.”

Michael McDonnell, managing director of human resources body CIPD Ireland, said: "All the cost-cutting has been done over the past six years and there is nothing left to cut."