We’re living in an era of grim news: the coronavirus pandemic has swept across the globe, forcing many businesses to close doors and make challenging decisions about staffing, assets, and strategies. We’re bracing for an economic downturn, with some estimates expecting 34 percent fewer goods and services from April to June in the US this year compared to last, according to recent predictions from Goldman Sachs But even with all the dire predictions, with the right mindset and strategy, your business could actually boom in the midst of this gloom. Look at Warren Buffet, the business magnate, investor, and chairman and CEO of Berkshire Hathaway who hardly needs his credentials noted. Buffet advises, “Look at market fluctuations as your friend rather than your enemy. Profit from folly rather than participate in it.” He also acts. In 2008, Buffet’s confident investment in Goldman Sachs rewarded him to the tune of $3.7 billion, according to Fast Company. Although no other business has the funds Buffet does, you can take a page from his playbook and take his advice to find the upside for your business in the downturn. Here are a few things to consider:
- Now is the perfect time to streamline your operations. Are your teams working with the most efficient technology stack, or are they bouncing around between a plethora of tools that hardly talk to one another? A small investment in a better software solution can mean a large gain in operational efficiency in the long term.
- Focus on innovative, proactive steps instead of restrictive, defensive steps. When it comes to the bottom line in a recession, your business has two options: cut back, or find new revenue streams. While many will hunker down to make it through the tough time, your innovation solutions could propel your business forward so you come out ahead.
- Lean into your marketing efforts. Surprisingly, even while people tighten up personal and business budgets in a recession, research shows advertising in a downturn can lead to growth. As early as the Great Depression, General Motors outpaced market leader Ford by 1931, thanks in part to its innovative use of outdoor billboards and radio advertising that lauded the company’s budget brand, Chevy. Looking at the 1985 Recession, McGraw-Hill’s Research noted companies that kept or increased advertising budgets saw a 256% increase in sales compared to competitors who cut their budgets, according to Entrepreneur.
- Reset business priorities. We’re devoting plenty of time to predicting (and maybe wishing) when things will return to “normal.” But the truth is, we’re unlikely to return to the way things were in full. Instead, businesses need to accept what has changes in business, the industry, and the larger environment. This might include determining where you have competitive advantage, understanding customer needs more deeply, managing your reputation, and assessing and mitigating business risks. One of the best ways to drive transformational business decisions is to ensure business leaders have the right software to harness big organizational data and make better informed decisions. And as you navigate a tumultuous economy and business landscape, leaning on AI-powered predictive analytics in your tools can help you assess potential outcomes and make the best decisions.
- Prioritize your people. Even as many businesses are forced to lay off or furlough staff to weather the shelter at home orders and business closures, your people remain the most valuable asset of your business. Ensure you have a system in place to stay in touch with employees who have been laid off or furloughed, and stay close to employee sentiment among those still at your organization.