Tips about surviving and thriving in a recession you should know
There’s much talk these days about a recession and what that could mean for our own businesses. Recessions can be tough for some and yet others thrive. What’s the secret? Is there one?
In my research I’ve identified strategies that can help businesses not only survive, but thrive during economic downturns.
What I found can be summed up in three main areas:
Controlling costs:
Looking for ways to reduce expenses is key; however, this is not always where you might think. While some companies may turn to layoffs, it’s not always the best solution. Finding operational efficiencies in how you deliver your products and services is a great place to start. Also, if there are ways to reduce contract costs, renegotiate with suppliers or source alternative supplies or materials, that’s a great place too.
Investing:
Investing in infrastructure can be another great place to fortify your business. Technology can help you reach new markets (particularly technology that can support marketing and sales), or provide your services more efficiently. Invest in your assets and build new ones. Looking at your business model for ways to serve your clients well and deliver your offerings to new markets is a great place to invest. Having upgraded technology, infrastructure, skills and assets provides your business with a stronger foundation on which to grow for the long-term and gives you an advantage as you move out and beyond a recession.
Applying Focus:
Bringing focus to your core products and services, and delivering them well will help ensure your customer is still receiving great service and you’re building customer loyalty. Identify ways that you may also diversity your income stream without stretching your capacity.
“Obstacles don’t have to stop you. If you run into a wall, don’t turn around and give up. Figure out how to climb it, go through it, or work around it.”
— Michael Jordan
Research conducted by the Harvard Business Review studied 4700 public companies: their performance and strategic selections 3 years before, during, and 3 years after the last three global recessions. (Article: Roaring Out of Recession, Harvard Business Review by R. Gulati, N. Nohria, F. Wohlegezogen). Here’s a snapshot of their findings:
“According to our research, companies that master the delicate balance between cutting costs to survive today and investing to grow tomorrow do well after a recession. Within this group, a subset that deploys a specific combination of defensive and offensive moves has the highest probability—37%—of breaking away from the pack. These companies reduce costs selectively by focusing more on operational efficiency than their rivals do, even as they invest relatively comprehensively in the future by spending on marketing, R&D, and new assets. Their multi-pronged strategy…is the best antidote to a recession.”
Considering these areas can provide you with an approach and framework for considering how to secure your foundation and make your business even stronger to weather uncertainties.
There is never a down-side to a conversation. If you’re curious about enhancing the foundation of your business book here now.
NOW is YOUR time,
Ariana
Emerging Outcomes Coaching & Development - Business Coach in Canada, Canadian Business Coach, Executive Coach, Leadership