United Kingdom
Cautious optimism but more challenge ahead - Kim Hayward
Our third annual Central South Report consolidates accounts of the region’s top 150 companies to provide a barometer of the economic climate for the region. Although the report shows the effects of the recession, there is some room for optimism.
When we thought about our 2010 report we knew the landscape would have changed and we feared the worst. For the most part these fears were confirmed; profits plummeted, net assets fell, indebtedness rose and employee numbers fell. Encouragingly though the majority of companies in the report maintained their trading levels. Companies across the region were forced to look closely at their business operations to eliminate unprofitable elements or undertake carefully managed restructuring plans. The real benefit of these actions is unlikely be felt until 2010 or – in all likelihood – 2011. But the fact that companies are putting renewed emphasis on operating leaner with lower costs bases gives room for optimism that the Group can manage itself through these difficult times.
The toughest recession since records began officially ended in January 2010: time will tell whether this a false dawn and the speed and intensity (I wish!) of any recovery.
The post-recession world will be very different from the one we knew before the crisis began. Businesses in the Central South region will have to evolve rapidly and radically, in response to new opportunities and threats. The winners will be those who have applied these skills successfully and who may need to reinvent themselves; through new markets, new business models and new management structures.
There is a recognition of the growing need for innovation and knowledge and with that an increase in demand in areas such as technology and research which have traditionally been areas of strength for the Central South region. But the report also suggests that the region’s businesses will need to pursue growth opportunistically in fields where they already excel. Across the Central South there is strength in technology, especially defence electronics, security and related support services, training and considerable marine and maritime expertise.
Our report also predicts the rise of new business models, with greater collaboration and partnership working to allow businesses to remain agile enough to take advantage of business opportunities whilst also maintaining a focus on profit and growth. The exploitation and even sale of our intellectual property presents a significant business opportunity for the region, and will allow businesses to reinvest in staying ahead of the competition. Our region has excellent universities with significant research capabilities and clusters in several key sectors. Our local governments are collaborating increasingly effectively and organisations such as Solent Synergy and Solent Innovation Growth Network are emerging to broker the interactions needed between the education sector, SMEs and large businesses to deliver a range of significant business opportunities.
I am confident that the Central South region is well placed to thrive in the new economic landscape although the composition of the top 150 companies may look very different in years to come.
For more information on the Central South Report, please click here.