Choose your leaders wisely

I can see the argument for posting a newsletter on the day of, or a few days after, the Budget. It would give me the opportunity to speculate on how each change may affect firms over the next five years or so. A chance to perhaps offload any personal frustrations I may have. However, I long ago gave up on Westminster understanding business. In particular, they don’t understand SMEs, where owners’ fortunes are often tied to their firm. I wish all UK governments well, we all succeed when they do, but as business owners, builders, and managers, our job is to navigate the choppy waters of commerce regardless of politics. To overcome all obstacles (even if the obstacles are put in front of us by our own political leaders), to build good places for colleagues to work in, to solve client’s problems.

I’ve been recruiting since 2000, a short-term role turned into a career, which turned into running my own business. Whilst some times have been calmer than others, there has always been some challenge on the horizon for me, and more importantly my clients. ?I can’t stress it enough, the clients who have seen beyond the short-term and who have focused on their long-term vision have always outperformed the more skittish leaders. The tactics may change, the aim, the strategy, and enthusiasm remains undimmed. Many parts of financial services remain very challenged, but someone will emerge from the short-term pain larger and more profitable than the rest of the pack. It’s often hard to see who at the time, but with hindsight, it’s those who keep investing, who keep on finding ways to do more for clients, and those who dance that precarious line between cost control and investing, who win. Where I have often seen things go horribly wrong is the “build it and they will come” managers. In my experience, building something is great if it starts with sales and marketing, but building a team of customer service professionals when you’ve got no idea on how you will acquire those customers is expensive and futile. Choose your leaders very carefully is my advice.

I thought that leadership would be tested the most during the pandemic, but after the initial shock, leading was quite fun for many. Awarding pay rises, coming up with flexible working policies, and generally enjoying the unexpected bounce in activity was fun. The days of logging off at 5:30 p.m. and straight to the barbecue, having had one of your best quarters ever, an unthinkable situation for many pre-pandemic. However, that wasn’t a test of leadership once the panic regarding safety had died down. The real challenge started in early 2022. The war in Ukraine and the effects of huge amounts of COVID stimulus combining to create inflation played havoc. ?You all know the story of how high rates reduced volumes in many industries, or how cost:income ratios were totally out of kilter. The new normal, nothing more than a blip.

It may not have made the press in the same way, like the large redundancies of the GFC, but redundancies have been made. Outflows have been brutal, raising capital hard, and managers have had to have some hard conversations. Asking people to come back to the office, far harder than signing off on working from home (the Workers Rights Bill may reverse this). However, it’s the managers who’ve asked people to do more for less, who’ve been able to maintain morale despite having the awful task of having to reduce headcount, who have proved their worth. A huge part of this, despite very stagnant conditions, has been their unshakable belief in the long-term vision and the great people of “never give uppers” who they employ, which means that their firm has a good chance of being one the long-term winners when things settle down.

How do you find those leaders? Well, someone who’s overcome bad times before isn’t a bad bet, digging into someone’s background where they’ve proved tenacity a good place to look also. You know you have a real gem when someone has been through tough times, while:

1. Keeping their key staff
2. Thinking about how their colleagues careers will develop when things improve
3. Seeing the happiness in the challenge

What you absolutely don’t want is a leader who is looking to bail out at the first sign of crisis. The world we now live in is full of crises and managing through change is THE skill for current times. There are plenty of very good personality profiling tests you can look into nowadays. Of course, I think an experienced recruiter can do a great job in finding great managers, but why not use the science if it’s available.

Focusing on the long -term will help us all immeasurably, it will grow our businesses, and will keep us all sane.