It’s been a great run. The economy has been on an upswing for years. Do we even remember what a recession feels like?
We’re due. And many forecasters believe we’re due in 2019. Of course, economic forecasts and economic reality are often two different things. So what should you do?
Here’s a hint: Think back to what you usually do, what most organizations usually do. Most organizations wait too long before reacting. They’re caught unprepared. It’s the shock of a downturn that forces us to finally open our eyes to the uncomfortable truths that were there all along: We’re bloated. We’ve ignored waste. We tolerated what we shouldn’t tolerate. Sound familiar? Growth and profits hide many sins.
Here’s how you can get a jump on your competition and soften the hit to your P&L: start thinking and planning now about what actions to trigger when the inevitable downturn happens. Get your leadership team together and pose this scenario: The downturn has hit and your best estimate is that revenues will be off by 10 percent in 2019. What do we do?
On the revenue side, you might implement incentives for your sales team to close aggressively and get prospective business contracted. You might offer more flexibility in your payment terms. You might offer “light” versions of your products and services. Or you might unbundle them to make pricing more palatable.
On the expense side, you might cut cost-intensive projects. Or overtime. Or non-essential travel. You might cut underperforming products or locations.
Don’t wait for a recession before you start preparing for one! Identify your prioritized action steps now and define the conditions that will trigger them.
Sure, a recession will cause you some pain. But if you’re well prepared you won’t suffer as much or as long as your competitors will.
Make it happen.
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