When a downturn threatens, you need to take decisive steps to understand the situation and what it means for the future survival of your business.
Planning for a downturn helps you to maximise opportunities and prepare your business to survive and thrive in all circumstances.
Keep control of your cash
Finance and funding for future success
When times are hard, cash is king. Commentators suggest that the companies who emerged from the last recession as sector leaders typically had an average net debt-to-equity ratio of about half that of their less successful competitors before the downturn hit. The winners also held more cash on their balance sheet than the companies that were hit hardest.
Clear Communication
Managing Stakeholders for long-term success
Managing your stakeholders effectively in challenging times is crucial to executing a winning strategy. Good communication is critical.
Streamline Operations
Managing operational capability for sustainable success
Flexibility is critical in improving your operational position in a downturn. Now is probably not the time to save money by cutting back your marketing budget, but it is the time to make some hard-nosed decisions about what it is you are going to spend that money on.
Leading for Success
Leading your team to triumph through tougher times
Anyone can manage a company through good times, but now, more than ever, it’s important to take the time to step back from your daily tasks and ask yourself whether you’re equipped to lead your team to success through challenges and uncertainty. Managing in a downturn may be difficult for many of today's business leaders, who have built their careers through years of economic growth. Natural attrition may have removed experienced managers from your business.
Be Prepared
Prepping your business for peak performance in any scenario
Nobody holds the crystal ball for the future. Clever companies plan ahead for any scenario. When a downturn threatens, businesses need to take decisive steps to understand the situation and what it means for their future survival. Planning for a downturn maximises the opportunities available, enabling the best prepared businesses to come through the bad times reenergised and fit for the future.
Seek the Opportunities
Identifying possibilities for sustainable growth and success
Economic downturns present opportunities for companies prepared to look. During the last recession, more than a fifth of companies in the lower quartile in their industries jumped to the upper quartile. Recessions reshuffle the decks more than boom times and research shows that gains made during challenging times tend to endure.
