December 18th, 2007
Which Side of the Pond Is Wisest?
Are American or European executives more enlightened when it comes to business and workforce management priorities?
A new study from AMR Research doesn’t tackle that question head-on, but it sheds some interesting light on the issue. At first blush, the findings back the notion that U.S. firms are more focused on short-term success compared with their European counterparts.
In particular, the research suggests American managers put a higher priority on profitability and revenue growth, while European business leaders stress increasing market share and getting innovative products to market.
AMR’s study focuses on spending on “human capital management” software. It surveyed a total of 304 business executives from the United States, Germany and the United Kingdom. Among other questions, it asked about the top two business priorities associated with human capital management for the next year.
Fifty percent of U.S. respondents named “increased profitability” as their company’s first or second priority, making that the top overall choice. “Revenue growth” came in second, with 43 percent of U.S. managers listing it as their first or second priority.
In the U.K., though, “increased market share” was the top choice, slightly edging out revenue growth. In Germany, increased market share and increased profitability tied for the top spot. Getting innovative products to market was the first or second priority for 28 percent of U.K. respondents and 19 percent of German respondents but just 11 percent of U.S. managers.
To be sure, there are limits to drawing conclusions about U.S. and European business priorities from the AMR study. For one thing, it polled information technology executives, who rarely call the shots at companies. What’s more, the study examines just two European countries.
It’s also possible that the relatively low score for innovation in the United States reflects U.S. prowess in the realm: Perhaps American companies are good enough at pumping out new market-pleasers that they can focus on other goals. Conversely, perhaps European executives are so focused on market share and innovation because they’re trying to catch up with Americans in these fields.
What’s more, the European and American respondents to the study could be part of global organizations based in a different part of the world from where they work.
Still, the research raises some intriguing questions. Is the American focus on earnings efficiency wise in the long run? Could European business leaders be preparing their workforces more effectively for future success?
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