Taking Advantage of a Downturn: Managing and Investing in Human Capital

Romil Bahl knows the secret to success for consulting firms in this downturn. The President & CEO of business advisory firm PRG-Schultz, and founder of Infosys Consulting, says it's simple—adopt the strategy today's leading firms followed during the last downturn. Rather than retrench for survival, invest in growth, especially in the talent that will be the engine of that growth. "Firms that have the P&L strength and ability to invest into a downturn," he says "invariably come out stronger."

The recession is forcing companies of all types to take a hard look at spending and investment. For professional services firms, one of the largest budget items is human capital. The typical response to a slowdown is caution. Hiring plans are put on hold and layoff plans are created. This is appropriate Bahl says, but it's only half of the equation.