2013: a turning point for management confidence despite a gloomy Autumn statement, business confidence tips 50% mark

For the first time since the coalition came to power, positivity among managers regarding their organisation’s prospects has tipped over the 50% mark. While 2012 has been a more difficult year for businesses than many envisaged, with uncertainty likely to continue into 2013, new research from the Chartered Management Institute (CMI) reveals that managers are, on the whole, more positive than negative about the year to come across a range of measures, including job security, organisational performance and job market confidence.

The Future Forecast report reveals that 53% of managers are optimistic about their organisation’s prospects for the coming year, up 10% from this time last year. In addition:

• 68% now feel secure in their jobs, up 6% from 2011
• More managers are not expecting redundancies in 2013 than are expecting them (49% compared to 45%)
• Managers’ confidence in the job market has increased – 47% now think it’s likely that they’d get a new job within three months if they were made redundant, compared to 37% in 2011
• Almost half of managers (46%) are optimistic about staff morale in 2013, compared to 31% who are pessimistic

In keeping with the Autumn Statement’s downbeat predictions for the economy, managers are still negative about the country’s economic prospects, with just 25% optimistic about growth in 2013. This figure is, however, up 17% on 2011. The restructuring of the UK’s public finances was the highest rated external factor expected to have a damaging impact on organisations in 2013, with energy prices and technological change claiming the number two and three spots respectively.

Reacting to the findings, Ann Francke, CMI chief executive, said: “We could be seeing a pivotal moment, where UK employers start to look ahead with renewed optimism. While 2013 is expected to be another tough year, it looks like many managers are confident about their organisations’ prospects. The challenge is to convert this optimism into results in the months ahead, which means focusing on developing their teams to deliver results.”

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The report also shows that managers have learned valuable lessons from the economic instability of the past few years and are focusing on developing their staff to turn their organisations around. The findings indicate that employers are shifting to a people-focused approach to achieve success in 2013 – three of their top five priorities were employee engagement (a medium or high priority for 81%), people development (87%) and performance management (95%). In line with this, there is strong support for staff-oriented policies that may have long-term affects on business growth, such as the right to request flexible working and reforming parental leave.

The report also asked managers their opinions about the best run organisations in the UK over 2012. The John Lewis Partnership came top of CMI’s poll for the second year running, praised for achieving success whilst keeping to its values and nurturing its staff. Other top organisations included Virgin Group, the London 2012 Games, Sainsbury’s and Tesco.

Francke continued: “Businesses are getting to grips with the fact that growth comes from growing their own people. Yet 43% of managers say they don’t have the right staff in place to meet business objectives. This calls for a real focus on people and more investment in staff development to help engage employees and strengthen their skills to boost performance. 2013 will be no walk in the park, but the organisations that get the best out of their people will be the ones that succeed.”