Andy Nunemaker, president of Milwaukee-based EMSystems LLC, says there are two things every company can and should take advantage of in an economic downturn: search for opportunities and upgrade the talent in the company’s workforce.
“A lot of good things come out of unfortunate situations,” Nunemaker said. “First and foremost, an executive is a steward for his or her business, and we have to realize right now and even in the early stages of a recovery there are a lot of talented people looking for jobs.”
EMSystems has followed those principles. The company not been sidetracked by the Great Recession as so many other companies have been. EMSystems made two acquisitions in 2008, another in 2009, has another one secured for the first quarter in 2010.
The company is in negotiations for at least six more acquisitions.
Many technology-based businesses, including EMSystems, which provides comprehensive technology solutions for emergency response and emergency preparedness in the health care industry, weren’t forced to make layoffs during the recession, Nunemaker said.
“Our company has continued to grow throughout this recession,” he said. “Our particular industry was not affected by the downturn, and so we’ve been able to scoop up some of those people and be more aggressive with talent upgrades.”
EMSystems performed an intense evaluation of its workforce to make sure everyone who was employed by the company was meeting their individual employment goals, as well as meeting the expectations of the company in terms of values and ethics, he said.
“We think we are at the point where we have really taken advantage of some good people in bad situations,” Nunemaker said. “During any economic time, owners have to do what is best for the company in the long run, and we really have done a complete talent upgrade as part of what’s best for the organization going forward.”
Nunemaker compared the approach to General Electric, which went through the same process on a regular basis under the leadership of former chief executive officer Jack Welch.
Nunemaker said the employee evaluations were not a cold, calculated process. He did thorough analysis of which team members were meeting their employment goals and which were the best fits with the company values. Those who weren’t meeting either expectation were let go and replaced with more competent individuals, and those who met the company values but weren’t doing so well meeting their employment goals were sent for some additional training, he said.
“It is the people that are meeting their performance goals, but don’t necessarily fit with the values of the company that most employers sit on the fence about,” Nunemaker said. “It was those employees that we were more aggressive with during the recession. Because of the multitude of qualified workers on the market during the downturn, we couldn’t afford to sit on the fence anymore.”
Nunemaker said companies need to do a talent upgrade now to take advantage of the available talent pool in the bad job market.
“That level of qualified workers won’t be there for much longer,” he said. “As the recovery happens, those workers will get picked up, so now is the time to act. It’s definitely a buyer’s market from an employer standpoint.”
Since the downturn, EMSystems has also been aggressively searching out acquisition candidates – companies that have run into cash flow problems and have no choice but to sell.
“We have found a lot of companies that have to sell when under normal circumstances they wouldn’t have to,” Nunemaker said. “There is nothing fundamentally flawed with their business models, but the economy has forced unforeseen problems on them. For companies that have the means, it is an ideal time to swoop in to buy them for a low price and make them worth much more in a year or two.”
Some companies are not taking full advantage of those opportunities, he said.
“You don’t have to be a large company to make acquisitions,” Nunemaker said. “I think there will be a mass audience of people kicking themselves for not buying when they should have. If you have the means or can find the means now, just like with the talent pool, this is an ideal time to make those decisions on behalf of your business.”
