Despite more than one third of Australian businesses forecasting downward economic conditions for the next six months, a new report has shown a significant proportion of the market does not have a risk, business continuity or succession plan in place.
In the bi-annual Commonwealth Bank Future Business Index, released yesterday, it was revealed that the overall business outlook from leaders for the upcoming six months remains pessimistic, yet poor planning and lack of strategizing for weathering uncertain economic conditions is rife.
The index measured the managerial outlook in terms of business conditions, challenges and opportunities, projected revenue, and how prepared organisations are to navigate future volatile conditions.
According to Symon Brewis-Weston, Commbank’s executive general manager of corporate financial services, the index results revealed a mixed snapshot of the Australian economy, with significant divergences not only across sectors but also states and individual business size.
However, he said “The outlook suggests that in general, mid-market companies are not confident about their position in which to weather uncertain business conditions in the near future.”
Over half (54%) of businesses expected an increase in salaries and wages and 53% were anticipating an increase in operating costs. Three-quarters (75%) of businesses believed that rising energy costs would have an impact over the next six months, followed by rising fuel costs (66%), increases in wages (61%) and the fluctuating Australian dollar (60%).
With market conditions continuing their volatile behaviour, Brewis-Weston pointed to the value of proactive planning in order to help manage what lies ahead, and said that opportunities are very much alive for those companies which take a proactive approach to management and planning.
Additionally, the latest Michael Page Employment Index, also provided a snapshot of anticipated hiring and business trends across the white-collar employment market for the final quarter of the year.
Despite concerns around global economic conditions, it was found that employers in Australia are continuing with plans to increase staff headcount, and the report found: