How to emerge from the GFC as a leading employer
Executive bonuses will tumble and "people factors" come to the fore as leading employers emerge from the global financial crisis, according to a new book on organisational change.
Employers restructuring - or leaping into the fireAccording to Beames, the current economic climate provides CEOs and executives with a perfect opportunity to restructure, outsource non-core activities and discard unsustainable business models or unprofitable products and services.
"It provides them with legitimacy for change and possibly the pursuit of new opportunities."
Some employers, however, have leapt from the frying pan into the fire, Beames says, with impulsive and uncoordinated responses to the downturn, including:
He says the age of "short termism", or get-rich-quick schemes, is over, and that sustainability will hinge on assessing and mitigating risk and more stringent corporate governance.
The "cult" of the CEO - which Beames describes as "a simplistic and convenient perspective where the CEO's impact on an organisation's success is accorded more weight than it deserves" - will be replaced by a focus on the team, and compensation systems will be overhauled so that executive pay is aligned with sustainable profits.
The current debate over proposed legislation to limit extravagant remuneration practices (such as excessive executive termination payments, see related article) is "clear evidence of the winds of change", he says.
The future of managementThe traditional work of management will be performed less by managers as employers transform post-crisis, Beames says.
"It will be pushed out more to the periphery and embedded in systems via technology," he says.
"Decision making will be more peer-based with power based on competence, and less on authority vested in organisational structures."
Managers will have to earn authority, he says.
HR managers and other leaders must employ a more collaborative, transparent, and respectful approach in order to motivate staff.
"The hope is that more enlightened approaches to managing people will be adopted," Beames says.
"Irrespective of their status, one universal should prevail - that of treating all employees with honesty and respect."
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