Recession Power: Is it possible for Companies Rise to the Top, Even in Down Times…
Thanks to our news channels and papers, I got curios towards a subject called Recession and its possible impact. The way they all are covering this topic – it’s not very far that we all are going to loose our business, jobs and money.
To find out the truth - I did some online research and prepared this document – which shows that we don’t need to press the Panic button as yet. It’s just a normal economic cycle.
I am sure, we all agree that Recession is one of the most distorted, counterproductive words in the English language. We are in economic downturn that may get worse before it gets better. It has generated a fear in the minds of consumers and business owners – a fear of defeat!
But if we see its positive side, it has forced us to get more conscious about our money and spending. Through this we have realized that we have to get rid of waste and conserve our resources where most needed.
If we go by the words of management gurus “Recession IS strictly a matter of our perception". It’s we who perceives and responds to a recession and determine whether our business grows profitably or fights for survival.
This document proves that companies can actually do better during recession, if –
1) We can transform external threats into opportunities: The Japanese are masters at crisis management and look at situations like recessions as polarities. That means, neither all good nor all bad, but a mixture of both. The Japanese symbol for crises is a representation of two separate symbols: danger and opportunity. Such a perspective encourages responsiveness - not reactive ness. As a result, the Japanese focus not on the problem, but on new solutions - not on survivability, but on growth - not on short-term losses, on but long-term prospects.
Give a Thought - How do we perceive the current downturn - as a threat or an opportunity? How might the recession actually be an opportunity for our business?
2) We can take advantage of and profit from changing dynamics in the marketplace: A business can grow and profit during a recession if it understands the underlying dynamics of the marketplace. Crises tend to stimulate change in people. The challenge is to respond to such changes in a timely and direct fashion. To take advantage of these shifts, we have to consider 5 "W's."
¨ WHO: Who is doing the buying now? Although overall spending may be down, such trends cannot be generalized across all industries and business segments. Buying behavior shifts, changes and refocuses more than it declines. What new markets can we address that are actually on the rise?
¨ WHAT: What needs and benefits are priorities for our customers at this time? Are there new products or services that might address these shifts or serve as alternatives to satisfy the status quo?
¨ WHEN: What needs must the customer have satisfied now VS later? What special incentives will motivate the consumer to buy today?
¨ WHERE: During a downturn, customers often rethink their buying loyalties. From what sources are they currently buying? How can we make our products more accessible to our target market to buy?
¨ WHY: The "why" addresses customers' underlying motivations for buying. What motivations are driving customers' buying decisions today? What are customers' expectations of the future? How will these expectations affect their buying behavior today?
3) We can catalyze seemingly "negative" times into positive moves: In recessionary times, we have to aggressively look for the "silver lining in the cloud" and mobilize resources to seize those hidden opportunities. We have to act, not react.
4) We can make room for new growth by "de-cluttering" that which is marginal or ineffective: During times of growth and expansion, it's easy to get hooked into over-spending, "over-doing" and over-confidence. Sloppy behaviors, attitudes and habits often creep in and get masked.
We have to take advantage of down times to de-clutter "excesses" - i.e. any drains on time, money or people resources generating little or no return, have to scale back to what they do best in order to be at their best. We have to make room for new growth and profits.
5) We can build our resilience muscle to thrive in tough times: In the 21st century, accelerating change, increasing complexity and escalating risks have become the new business reality. To withstand external shocks that can destroy a business, we have to build our resilience capacity.
Resilience, first, is a mindset. Resilience thinking transforms uncertainty into confidence, fear into action and adversity into advantage. On an organizational level, resilience comes from a strong culture based on operational flexibility, employee loyalty and team collaboration.
6) We can aggressively position our selves ahead of the competition during economic downturns: During economic downturns, most companies go on the defensive -- cutting back costs, downsizing marketing efforts and commoditizing products and services - just to survive. But to fight we have to do just the opposite.
In recessionary times, we have to position our selves to win -- ramping up promotions, accelerating new product introductions, and keeping a visible profile. By taking advantage of the emerging opportunities, we not only differentiate our selves during the downturn but also position our selves for explosive growth after its turnaround.
7) We can find the "learning" and the "grander purpose" hidden within challenging times: Our greatest challenges are our greatest teachers. Their "grander purpose" is to shift our thinking, behaviors, strategies and actions and ultimately aid us in our future growth.
Companies negatively impacted by a recession never see the grander purpose such times can offer them. Instead, they perceive only the worst, react out of fear and shrink to a victim mentality.
While on the other hand, we have to see recessions as learning opportunities. We have to recognize that yesterday's thinking and strategies will not address today's challenges.
Thanks to our news channels and papers, I got curios towards a subject called Recession and its possible impact. The way they all are covering this topic – it’s not very far that we all are going to loose our business, jobs and money.
To find out the truth - I did some online research and prepared this document – which shows that we don’t need to press the Panic button as yet. It’s just a normal economic cycle.
I am sure, we all agree that Recession is one of the most distorted, counterproductive words in the English language. We are in economic downturn that may get worse before it gets better. It has generated a fear in the minds of consumers and business owners – a fear of defeat!
But if we see its positive side, it has forced us to get more conscious about our money and spending. Through this we have realized that we have to get rid of waste and conserve our resources where most needed.
If we go by the words of management gurus “Recession IS strictly a matter of our perception". It’s we who perceives and responds to a recession and determine whether our business grows profitably or fights for survival.
This document proves that companies can actually do better during recession, if –
1) We can transform external threats into opportunities: The Japanese are masters at crisis management and look at situations like recessions as polarities. That means, neither all good nor all bad, but a mixture of both. The Japanese symbol for crises is a representation of two separate symbols: danger and opportunity. Such a perspective encourages responsiveness - not reactive ness. As a result, the Japanese focus not on the problem, but on new solutions - not on survivability, but on growth - not on short-term losses, on but long-term prospects.
Give a Thought - How do we perceive the current downturn - as a threat or an opportunity? How might the recession actually be an opportunity for our business?
2) We can take advantage of and profit from changing dynamics in the marketplace: A business can grow and profit during a recession if it understands the underlying dynamics of the marketplace. Crises tend to stimulate change in people. The challenge is to respond to such changes in a timely and direct fashion. To take advantage of these shifts, we have to consider 5 "W's."
¨ WHO: Who is doing the buying now? Although overall spending may be down, such trends cannot be generalized across all industries and business segments. Buying behavior shifts, changes and refocuses more than it declines. What new markets can we address that are actually on the rise?
¨ WHAT: What needs and benefits are priorities for our customers at this time? Are there new products or services that might address these shifts or serve as alternatives to satisfy the status quo?
¨ WHEN: What needs must the customer have satisfied now VS later? What special incentives will motivate the consumer to buy today?
¨ WHERE: During a downturn, customers often rethink their buying loyalties. From what sources are they currently buying? How can we make our products more accessible to our target market to buy?
¨ WHY: The "why" addresses customers' underlying motivations for buying. What motivations are driving customers' buying decisions today? What are customers' expectations of the future? How will these expectations affect their buying behavior today?
3) We can catalyze seemingly "negative" times into positive moves: In recessionary times, we have to aggressively look for the "silver lining in the cloud" and mobilize resources to seize those hidden opportunities. We have to act, not react.
4) We can make room for new growth by "de-cluttering" that which is marginal or ineffective: During times of growth and expansion, it's easy to get hooked into over-spending, "over-doing" and over-confidence. Sloppy behaviors, attitudes and habits often creep in and get masked.
We have to take advantage of down times to de-clutter "excesses" - i.e. any drains on time, money or people resources generating little or no return, have to scale back to what they do best in order to be at their best. We have to make room for new growth and profits.
5) We can build our resilience muscle to thrive in tough times: In the 21st century, accelerating change, increasing complexity and escalating risks have become the new business reality. To withstand external shocks that can destroy a business, we have to build our resilience capacity.
Resilience, first, is a mindset. Resilience thinking transforms uncertainty into confidence, fear into action and adversity into advantage. On an organizational level, resilience comes from a strong culture based on operational flexibility, employee loyalty and team collaboration.
6) We can aggressively position our selves ahead of the competition during economic downturns: During economic downturns, most companies go on the defensive -- cutting back costs, downsizing marketing efforts and commoditizing products and services - just to survive. But to fight we have to do just the opposite.
In recessionary times, we have to position our selves to win -- ramping up promotions, accelerating new product introductions, and keeping a visible profile. By taking advantage of the emerging opportunities, we not only differentiate our selves during the downturn but also position our selves for explosive growth after its turnaround.
7) We can find the "learning" and the "grander purpose" hidden within challenging times: Our greatest challenges are our greatest teachers. Their "grander purpose" is to shift our thinking, behaviors, strategies and actions and ultimately aid us in our future growth.
Companies negatively impacted by a recession never see the grander purpose such times can offer them. Instead, they perceive only the worst, react out of fear and shrink to a victim mentality.
While on the other hand, we have to see recessions as learning opportunities. We have to recognize that yesterday's thinking and strategies will not address today's challenges.
PS: Sources can be shared on request!!
8 comments:
good one !!! surely tells us the proper methods of handling our business to the best level!!
Hi,
As someone who actually chose to start a business during these difficult times, I am glad to see that there are like-thinking individuals out there. I agree with you completely, and I think that businesses that manage to come out of these times successfully will be stronger and better for having mastered the challenge. Of course, I hope my business is one of them - time will tell.
Thank you!
a very good piece of writing.very informative.
Right on. Who knows, this could end up being great for our business.
This is really great. Good Luck!!
Varun, I agree to what you say as economic downturn has very less to do with buying. May be the quantities of buying have gone down, but people are still buying. If one can't convince the prospects of his offerings then the problem is with the offerings. As people who say they have no money to buy your offering are still in business. So this statement falls flat on its face.
People are often told to increase their marketing efforts at the time of recession leading to an increase in sales. This to my experience is wrong as one may be busy but not effective. Eventually you’ll burn out your prospects. Rather one should focus on the best seeling opportunities and put his energy in the right direction. rather then chasing numerous half baked leads follow the most promising two. Less than half of today’s business-to-business sales professionals have ever weathered a true economic downturn.
Good coverage of opportunties, that serve as a reckoner when caught in adverse side of business cycle !!
Very informative post Varun. Infact it does encourage one to think of opportunities amidst recession! Keep posting more like these.
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