How to Lead your Firm Through a Downturn
1. Understand the true picture
Not all sectors will be hit, take a look at where your business is placed and adjust targets to match. Banking, property and construction have been affected but telecommunications and other ‘essential’ providers are unlikely to be hit as hard.
2. You need to act
Don’t be paralysed by the fear and gloom. Take the opportunity to outperform your competitors, by handling the situation better than them. Life does not stop during recession, focus on your core values and adapt what you are offering to out-manoeuvre your competitors.
3. Cashflow is king
Get on top of your cash position. Too much time management time is diverted away from maintaining sales to sort out a financial crisis. Be proactive in sorting out your finances. Your company won’t go bust if it has cash.
4. Keep an eye on the future
Short term cuts must not conflict with your medium and long term goals. Cost cutting now will leave gaps and will leave you weaker in the future.
5. Focus on customers
Understand their situation, large and expensive products may be out of their reach, so consider instalment pricing and invest in them rather than expensive advertising.
6. It is time to innovate
New ideas and products could pave the way for success in the upturn. Now is a great opportunity to look at the ways that will grow the business.
7. Target cuts
Focus on keeping things that are core and cut out the waste. Avoid cuts that will affect key customers and the most productive areas of the business.
8. Look for opportunities
How are competitors fairing? Is now the time to move and acquire your direct competitors? Are there weak links in your supply chain? Look at other markets, not all parts of the world or the economy are in a downturn.
9. Don’t sack people you will need
Losing key members of staff now will leave holes in a few years time. Are competitors staff on the market and is it time to recruit competitors key staff?
10. Get your staff on side
Motivate the staff you have. Cut costs by empowering them and keeping them excited about the job. Keeping them happy during hard times will make them want to stay when the crisis is over.
Download the How to Lead your Firm Through a Downturn fact sheet as a pdf
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