Growing pains in the insolvency world
There are always organisations which will prosper in a difficult economy and insolvency firms are one of them. With increased demand for their services, the key right now for corporate recovery and insolvency firms is to ensure they can fulfil this demand by having a comprehensive resource planning and retention strategy in place, and for insolvency professionals it’s all about making the right career move. We ask respected figures in the industry their view on how they see the insolvency industry coping with the demand.
The majority (90%) of the R3 membership expects there to be an increase on the corporate side of insolvency.
Gearing up to meet the demand
Leading commentators estimate that the number of insolvency professionals will need to increase by 25% to manage the rise in insolvency work. Nick O’Reilly, R3 President and Client Partner at Vantis, supports the view of further growth to come. “We are definitely gearing up for an increase here at Vantis over the next 12-18 months. We have recently taken on staff in London and our head count will increase in line with case load as more work comes in.” He continued by saying “Surveying our members recently, the majority (90%) of the R3 membership expects there to be an increase on the corporate side of insolvency.”
The challenge for all insolvency firms is assessing the demand and managing their internal resources accordingly. Timing is critical, recruit too soon and firms may be overstaffed; too late, and many of the competitors may have already geared up to cope with the growth in demand.
Keith Stevens, Partner at Wilkins Kennedy is reviewing where he thinks the market is going and how this will impact his firm. “As for the sustainability of our work load – some think short, some think medium, some think long term recession. We just don’t know. I believe in 2 years time there will be still plenty of work but I have no idea how this will be in 5 years time – will the work be drying up? The problem that gives me is, how do I staff up. It’s all about getting the right balance.”
Our clients are approaching their resourcing and staffing of teams in different ways and seek a range of skills. Some are looking at reallocating staff from other departments such as Corporate Finance to assist in this busy time. Some are developing their own graduate schemes to ensure they have the skills they need in the future.
Many have indicated that those who have CPI and/or JIEB qualifications will become extremely desirable and for some it’s not just a case of moving accountants into the insolvency market. “Not long term, no. It’s all about having the right aptitude,” stated Keith Stevens. “There is no right or wrong in this job, it’s all about what works within the law. The role is heavily about dealing with people. Audit and tax for example can be quite regimented in their way of working and insolvency isn’t like that in most cases.”
“Look after your staff. Make sure they don’t leave. Retention is everything.”
Keeping the best talent
As firms start to struggle to recruit the staff they need, competition for insolvency professionals will undoubtedly increases. It’s fair to say that firms are at risk of losing their best talent to rivals. Robert Keyes, partner at Tenon offers some no nonsense advice to insolvency firms in the current climate.“Look after your staff. Make sure they don’t leave. Retention is everything.”
So what does this increase in work mean for insolvency practitioners in the long-term? Inevitably as the market becomes more candidate-driven, the best talent can only flourish in this climate, however, ensure you maximise your prospects by asking yourself some of the following: Do you agree with the strategic and tactical approaches of the insolvency firm you are either working at or interested in moving to? Are you confident the firm is set up to take full advantage of the expected increase in business? If you are looking to make a move, have you fully exhausted every opportunity to get what you want from your current employer?
No-one is sure to what extent the demand for insolvency services will be however, what is certain is that firms will either get their resource planning and retention strategy right or will mistime their recruitment needs and lose their good talent to the competition.
David Hole, membership director for the Turnaround Management Association (UK) sums it up succinctly by saying “The recovery game is an interesting place to be at present. The winners will be those recognising and exploiting an opportunity.”
We welcome your comments on this article.
Comments are moderated and may not appear immediately.