By Maximilian Clarke
Whilst the vast majority of London businesses anticipate a spike in demand for their goods or services during the Olympic Games, research from Deloitte suggests far fewer are in a position to reap the benefits.
The research also suggests companies are taking the opportunities and challenges presented by the Games far more seriously. 87% have assessed or are currently assessing the impact of the Games on their business, compared with 46% last year.
Furthermore, all 200 respondents said they intended to assess the impact of the Games at some point before July. When Deloitte first asked these questions in autumn 2010, 53% of companies said they had no intention of doing so.
However, whilst these figures suggest companies are doing more to prepare for the Games, some concerns remain. Although 81% of companies said they expected a boost in demand, just 45% told us they had enough information to accurately make such a forecast. Furthermore, just 3% of companies felt they had enough information to properly test their response plans to the Games.
Heather Hancock, lead London 2012 partner at Deloitte, said: “Businesses in previous host cities have typically underestimated the impact of the Olympic and Paralympic Games. It appears that businesses in London and around the UK are determined not to make the same mistakes. A well prepared ‘UK plc’ is a vital part of the success of this summer and it is encouraging to see so many companies taking the Games seriously.
“54% of respondents to Deloitte’s most recent CFO survey predicted a ‘double dip’ recession this year. We all want to minimise that risk — so it’s even more important that business is prepared to sustain its usual performance, and ready to take advantage of any boost from the Games. Whilst the precise economic impact of the Games remains a topic of much debate, what is certain is that the best prepared and most agile businesses will grab the biggest share of the upside.”
Staff unavailability remains the biggest concern for companies ahead of the Games, with 42% citing it as a worry, almost exactly the same proportion as when asked last May. Concerns about security have increased slightly with 41% now saying they are worried by this, compared with 37% last year, whilst fears over transport disruption have slightly decreased (32% compared with 35%).
Companies are beginning to consider the steps which might be necessary to mitigate the impact of these issues. Our research shows that 43% of businesses intend to review their holiday policies ahead of the summer, whilst 33% plan to review flexible working, compared with 33% and 14% respectively who intended to do so at the time of our last research. Employee engagement is also being carefully thought through with 55% intending to install screens on working floors to allow staff to watch their favourite events.
Furthermore, more than half of all respondents tell us they are planning to review the security provision for their organisation whilst a significant minority (16%) are actively considering alternative work sites.
Rick Cudworth, Lead Partner for Games Readiness at Deloitte, said: “Over the last 12-18 months, the mindset of British businesses over the level of preparation required for London 2012 has almost completely turned around. When we first surveyed UK companies, two-thirds expected no impact on their business as a result of the Games. Today, just 2% feel this way which is a great result.
“Companies have come a long way in recognising the need to prepare, but some concerns remain about whether these preparations will be robust enough. Companies aren’t truly prepared for the upside benefits if their analysis of demand consists of a finger in the air, nor are they prepared for the downside if their plans haven’t been tested.
“Our biggest concern is that just one in five companies intends to review their business continuity plans before the Games. Most business continuity plans are designed to deal with one-off incidents played out over a short period of time. With the Olympic Games, there is the potential for several continuity challenges to impact at the same time and for a prolonged period. With concerns over security having increase, we would urge the 80% of companies not currently planning to review these plans to think again and make sure they are fit for purpose.”
Urging British businesses to think beyond the Games with their planning, Hancock added: “As we draw closer to July 27th, it is right that businesses primary focus will be on maximising the upside and minimising the downside to their business this summer. However, British companies should not think that the opportunities end with the Closing Ceremony. Businesses should begin to consider if they are ready to take advantage of Britain’s Olympic legacy.
“With future Olympic Games and FIFA World Cups being awarded to emerging economies such as Brazil, Russia and Qatar, there is significant potential to capitalise on the experience developed around London 2012. However, as with the Games themselves, only those well prepared and ready for the opportunity will be in a position to take advantage.”
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