find the latest legal job
Senior Associate - Litigation & Dispute Resolution
Category: Litigation and Dispute Resolution | Location: Melbourne CBD & Inner Suburbs Melbourne VIC
· Come work for a firm ranked in Lawyers Weekly Top 25 Attraction Firms
View details
Associate - Workplace Relations & Safety
Category: Industrial Relations and Employment Law | Location: Brisbane CBD & Inner Suburbs Brisbane QLD
· Employer of choice · Strong team culture
View details
Freelance Lawyers
Category: Banking and Finance Law | Location: All Perth WA
· Freelance opportunities through Vario from Pinsent Masons
View details
Freelance Lawyers
Category: Other | Location: All Adelaide SA
· • Qualified lawyer with a strong academic background
View details
Freelance Lawyers
Category: Other | Location: All Melbourne VIC
· • Qualified lawyer with a strong academic background
View details
Down with short-termism

Down with short-termism

Down with short-termismAs the economic downturn continues to batter some Australian organisations, executives are looking to cut costs and still hit their numbers through the last quarter of the…

Down with short-termism

As the economic downturn continues to batter some Australian organisations, executives are looking to cut costs and still hit their numbers through the last quarter of the year.

While some sectors such as engineering, mining and healthcare are less affected by the downturn and are still hiring professionals with the right skills, other sectors such as banking and finance have taken a major hit while legal, retail, real estate and manufacturing are increasingly vulnerable.

Banking and finance has been hardest hit, with a number of companies implementing retrenchments or seeking advice on how to best go about redundancies and outplacement. As the economic downturn becomes more widespread, a number of other sectors are also taking the same approach.

While companies do need to contain costs in order to make it through rough economic times, the danger in this is that executives and finance can sometimes take a knee-jerk reaction to market conditions. This short-term thinking is, to be frank, plain stupid. While the balance sheet will look better for a few months, the long-term damage that can be done to a company through such thinking is potentially significant.

It is people who are behind the productivity and profit of a company; companies don't just magically make money.

While boards can be afraid of negative shareholder reactions in the face of downgraded profit forecasts, and rightfully so, they should be more afraid of cutting too hard and deep if retrenchments are called for. Fortunately, executives and finance departments who are short-term in their thinking appear to be in the minority.

A much smarter and more sustainable approach is to think about the long-term business plans, and the skills and talent required to achieve these. This is the responsible approach. Every economic downturn will eventually pass, and the sustainability of a company and its ability to make money (or more accurately, the ability of its people to make money) is what matters.

Short-termism is notoriously entrenched in some companies. However, when it comes to cutting people, it is these kinds of companies that will suffer in the long run.

Like this story? Read more:

QLS condemns actions of disgraced lawyer as ‘stain on the profession’

NSW proposes big justice reforms to target risk of reoffending

The legal budget breakdown 2017

Down with short-termism
lawyersweekly logo
Promoted content
Recommended by Spike Native Network
more from lawyers weekly
Oct 20 2017
Podcast: One of law’s most infamous alumni – in conversation with Julian Morrow
In this episode of The Lawyers Weekly Show, Melissa Coade is joined by The Chaser’s Julian Morrow....
Oct 20 2017
High Court overturns ‘excessive’ anti-protest legislation
Bob Brown’s recent victory in the High Court over the Tasmanian government was a win for fundament...
Oct 20 2017
Changes to Australian citizenship laws blocked
Attempts to beef up the requirements to obtain Australian citizenship were thwarted this week, after...
Allens managing partner Richard Spurio, image courtesy Allens' website
Jun 21 2017
Promo season at Allens
A group of lawyers at Allens have received promotions across its PNG and Australian offices. ...
May 11 2017
Partner exits for in-house role
A Victorian lawyer has left the partnership of a national firm to start a new gig with state governm...
Esteban Gomez
May 11 2017
National firm recruits ‘major asset’
A national law firm has announced it has appointed a new corporate partner who brings over 15 years'...
Nicole Rich
May 16 2017
Access to justice for young transgender Australians
Reform is looming for the process that young transgender Australians and their families must current...
Geoff Roberson
May 11 2017
The lighter side of the law: when law and comedy collide
On the face of it, there doesn’t seem to be much that is amusing about the law, writes Geoff Rober...
May 10 2017
Advocate’s immunity – without fear or without favour but not both
On 29 March 2017, the High Court handed down its decision in David Kendirjian v Eugene Lepore & ...