Notes from a headhunter’s desk – December 2020

2020 has been an extraordinary, unprecedented year. The coronavirus pandemic has had an impact on all of our lives, personally and professionally.

As we look back at the last 12 months, and forward to the prospects for 2021, the first sentiments to express must be gratitude to the NHS and front-line workers, and sympathy to those who have lost loved ones to Covid-19.

Positive learnings we can take from the experience of 2020

Few people would wish for another year as challenging as this, but there are useful lessons from our experience as individuals, teams, companies and societies.

We have all had to be kinder to ourselves and each other this year and it is positive to be reminded that kindness matters. I have never believed that if you are being kind you are not being commercial. It is entirely possible to be kind and supportive, as well as performance-driven and profitable.

On a similar theme, one interesting observation from clients is that they and their teams feel more connected, not less, after months of remote working. In many instances, employee engagement has been higher in 2020, driven by a strong push from management to communicate about business performance more openly and regularly.

Good communication leads to trust and the building of strong relationships. Many companies have traditionally been good at communicating with the stock market, but less efficient at letting their own people know how the business is progressing.

At a personal level, when you ask someone how they are, it is now more than a superficial pleasantry. The fact that people were genuinely concerned for each other’s health did bring them closer together. As well as a heightened focus on mental health and wellbeing, this has been a year when diversity and inclusion has been important, a trend highlighted by the sentiment behind Black Lives Matter.

We have focused on wellbeing at Eton Bridge Partners and I sincerely hope all companies maintain this level of attention going forward.

People have adapted quickly to remote operations

I was pleasantly surprised by the way our industry, clients and candidates moved seamlessly to working remotely. We have administered multiple recruitment processes for clients in which every step was conducted via Teams or Zoom.

There were occasionally a couple of extra rounds of interviews, and an enhanced appetite to carry out due diligence. But it became clear that if you spend several hours talking with someone on a video call and the respect, rapport and chemistry you are looking for are there, they will probably be present in person too.

Similarly, the vast majority of our clients have been delighted by the levels of effectiveness achieved by their teams working from home. Many month-end and year-end processes have been delivered remotely and it is apparent that most people do not want to let their employers and team-mates down, especially if the company has looked after them in tough times.

Nevertheless, I have the sense that people are missing being in the office. Many of the companies we speak to are planning to move forward with a blended approach. While there are clear benefits to working from home – the roads are clear, the environment benefits and people save time and money previously spent on commuting – there are still elements of office life that contribute to team morale and togetherness.

Businesses must display an entrepreneurial approach

Many of the companies we are talking to are willing to think outside the box, be agile and adapt to how working behaviours have changed. Those who are entrepreneurial and opportunistic will benefit, but anybody stuck in neutral and unwilling to make strong decisions will struggle.

My heart goes out to the thousands of staff at Debenhams who lost their jobs shortly before Christmas. But it must be said that even before Covid-19 the signs were ominous for Debenhams, a tired brand that had lost its identity and direction. The brutal reality of any downturn – and this one has been as hard as any since the war – is that it will clear out the dead wood.

Pre-Covid, the economy was in reasonably good shape, and unemployment was low. But some retailers had clearly failed to adapt and take decisive actions to future-proof their businesses. The reality is that Covid-19 has accelerated their decline.

Let’s maintain the speed of decision-making

Many of our clients have welcomed the speed with which the Government made decisions in response to the coronavirus crisis. It moved swiftly to introduce crisis measures to support the homeless, wrote off £13.4billion in NHS debt and constructed the Nightingale hospitals.

In normal times, decisions such as these could have been debated for months, or even years. When your back is against the wall, however, you need to move quickly.

The vast majority of people I have spoken to welcomed the Government support for businesses and individuals through the furlough scheme, grants and loans.

It is only fair to mention that Britain has had high rates of Covid-19 and, according to the OECD, ours will be one of the economies hardest hit by the crisis. However, if the Government had not taken the steps it did at the speed with which they were delivered, we might now be looking at a depression rather than a recession.

Many clients have expressed a desire to retain that speed of decision-making, in both business and Government. Our clients have found that alacrity refreshing and would like it to be maintained.

2021 – a year of change and churn

The news that Covid-19 vaccines are on their way has undoubtedly boosted many of our clients’ confidence. It may take until summer before millions of us are vaccinated, but people in the consumer space and areas such as leisure, travel and hospitality can at last discern a light at the end of the tunnel.

There is likely to be plenty of change and churn. Candidates who wanted to move but felt it was too risky under the shadow of Covid-19 will now act. Employers may try to ease out people who have not performed well in 2020. Board and investors will want to see growth again in the near future. Private equity firms have money to invest and there will be some interesting distressed assets available to them. This could be a very busy year in the recruitment sector.

One interesting consequence of Covid-19 is that employers have opened up a bigger talent pool, while candidates have a broader reach too. If the expectation is no longer that you must be at your desk five days a week, you can live farther from the office – and firms can target talent in distant places, individuals who might be willing to work remotely and visit the office once a week or twice a month.

Indeed, people have asked me if this might be an opportunity for them to move out of London and live on the coast or in the Cotswolds, enjoying a quieter life with more fresh air and green spaces.

Rising to the economic challenges ahead

The UK’s national debt is now two trillion pounds. Only time will tell how quickly we bounce back. Given that the Government does not want to go down the route of austerity, there will be tax rises. It may need to be more creative to claw back millions; might we see companies such as Amazon taxed on revenues rather than profits?

The prospects of a Brexit trade deal with the EU change by the hour, and as I write this the most likely outcome is that we will leave with no deal. While Brexit is another hurdle for businesses to overcome, one thing 2020 has shown us is how adaptable we can be when required.

A few months ago, economists were predicting unemployment might rise as high as 15 per cent in the aftermath of Covid-19. Recently, however, the Government and the Bank of England estimated that the rate would be about 7.5 per cent. As we saw on the emergence from the banking crisis of a decade ago, cynics claimed the private sector would never create sufficient jobs, but it did.

For all Britain’s faults, we are a nation that loves business and trade. It was interesting, and encouraging, to see Ryanair, from the beleaguered aviation sector, investing in a significant order for new aeroplanes from Boeing. While unemployment may rise, there is a reasonable chance it will come down again quite quickly.

I’d like to take this opportunity to wish you and those close to you a happy Christmas and a prosperous New Year. 2020 has been tough, but let us not forget that climate of support and understanding. We are a resilient nation, as we have shown in a challenging year, and I am confident we will display that quality regardless of what 2021 has in store.

Mark Craddock

Partner
Head of Search, CFO & Finance Practice


Mark leads the executive search CFO & Finance Practice at Eton Bridge Partners. His personal area of focus is handling retained mandates to recruit permanent CFOs and their direct reports across the UK, Europe, and increasingly globally.