BDO report highlights talent retention, digital transformation and ESG top-of-mind for businesses
by CM Staff
Canadian businesses of all sizes and across industry sectors are experiencing recruitment and retention challenges, a trend that is expected to cascade into 2022.
TORONTO — While the COVID-19 pandemic has put significant pressure on Canadian businesses, midmarket decision-makers are pushing forward to rethink their approach and operations, according to new research by BDO Canada. The Midmarket Outlook Report 2021 provides a snapshot of the unique challenges and priorities facing these businesses, including talent attraction and retention, digital transformation, supply chain and ESG, at a critical time as the COVID-19 pandemic presses on.
The Canadian midmarket is comprised of a rich spectrum of organizations, spanning industries and geographies. The report compares the opinions of small (under $25 million in revenue), medium ($25 to $100 million in revenue) and large (over $100 million in revenue) enterprises in the midmarket.
“There’s no question the midmarket punches well above its weight in the Canadian economy,” says Daphna Smuckler, Managing Partner, Assurance & Accounting, BDO Canada. “This research demonstrates their resilience and vision, especially during challenging times like what we’ve experienced over the past 18-plus months, while casting a much-needed light on their particular experiences and priorities.”
Canadian businesses of all sizes and across industry sectors are experiencing recruitment and retention challenges, a trend that is expected to cascade into 2022. According to the report, 50 per cent of medium enterprises identified ‘attracting new talent’ as the biggest challenge for their company and expect that to continue. With this top-of-mind, and after more than 18 months of living through a pandemic, business leaders of all sizes (52% of medium enterprises compared to 41% of small and 55% of large enterprises) are aiming to place the mental health of their employees at the forefront of key workforce priorities in the year ahead.
Interestingly, while it is identified as a top priority, 43 per cent of medium enterprises indicated supporting the mental health and wellness of employees is also a top workforce challenge (compared to 34% for small and 26% of large enterprises) and they are most likely to find challenges with managing remote workers (29% of medium enterprises compared to 19% of both small and large enterprises).
With the best of intentions, medium enterprises say they are making ESG a priority, but data shows there is still work to be done. Almost three-quarters (71%) of respondents agree that their organization is doing a good job addressing environmental sustainability issues, and two-thirds (67%) of their management and board consider environmental sustainability to be a priority. Although these companies are making ESG a key focus, the data shows they could be doing more. Almost one-in-seven companies have yet to implement any steps to support environmental sustainability.
The pandemic has impacted the midmarket in a myriad of ways and digital transformation efforts were not spared. Fifty-four per cent of respondents indicated plans were impacted to some or a significant degree. This isn’t holding them back, though. The research shows that medium enterprises plan to commit more resources to their transformation efforts over the next year (64%).
The numbers point to another reason businesses are doubling down on digital transformation: they are seeing results. When asked whether they saw the return on investment they had expected from their digital transformation projects, more than two-thirds (67%) of medium enterprises indicated they had. For those who have aligned their transformation plans to business objectives, three-quarters (75%) saw a return on investment, compared to zero for those who hadn’t aligned and 44 per cent for those who were neutral on the subject.
