Business in a weakened economy is an echo chamber to a self-fulfilling prophecy. It's a slippery slope that always happens because, quite frankly, people believe what they see on tv. However, the trend eventually reverses once people, and especially small businesses, determine that things just can't get any worse.
Yes, it takes some cheerleading, but the economy will fix itself. Unfortunately many businesses miss the opportunities that present themselves either by overreacting to recessions or by not realizing when the market is ready to start trading again. With this in mind, here are several ways you can keep the bad economy from dooming your financial ventures.
DON'T CUT RESOURCES FOR SHORT TERM PROFIT
This should go without saying, but cutting resources is often a result of overreaction to the marketplace. Sales will be down, so the knee-jerk reaction is to start cutting sales, marketing, and advertising departments. You must stay on the offensive, finding new prospects anywhere you can.
When markets stabilize, your company will be lacking in key areas. Not only that, you will most likely have acquired many lost opportunities while you were waiting for the light at the end of the tunnel.
INNOVATE FIRST, ASK QUESTIONS LATER
The catch-22 with management styles like "Six Sigma" is that while they may promote short-term efficiencies (see above), they destroy long-term staff morale and innovation. Compare this to Google, which uses the 70-20-10 Principle where 70 percent of employee time is spent directly improving main products, 20 percent allowing development of whatever they think would make solid new products, and 10 percent for whatever their crazy hearts desire, even if it doesn't make the company any revenue.
Google's strategy is to provide long-tail growth of its company while retaining staff moral AND innovation. The priority is on the wellbeing of both employees and the company as a whole.
MEASURE RESULTS AND SET REALISTIC GOALS
Goal setting has always been a key factor in success, whether that be in business or your personal life. It keeps you on task, all the while striving to reach that next big milestone. In a bad economy, these goals can unfortunately become unrealistic. Sales just aren't what they were six months ago, but you haven't amended the return rates and let go several of your sales guys. That may or may not be their fault, but it's always important to err on the side of caution.
Keep track of what is coming in, and if it doesn't meet your fiscal year goals, it's okay to update them to match the current financial landscape. Fortune (or should we say "fortunate") 500 companies nationwide have already done so. Rather than have monetary goals, aim for performance goals that you can measure, like time spent making new sales leads, phone calls made during the day, etc.
Some sales directors use point systems, where various tasks are worth points based on proximity to a closed deal. These types of systems track work even if your company is not getting as much business as in the past. Salespeople may initially complain about all the task reporting, but it will definitely help them AND the company when things look dire.
TAILOR YOUR MESSAGES AND TALK BUDGET AT THE END
If anything, a bad economy forces you to think smart and think sharp. Yes, it's back to basics and every little thing you're used to overlooking is now important again. If you're marketing to consumers, stress value and quality. If you're marketing to other businesses, save the talk about budgets for after you know what their needs are and they know what you can provide.
In both cases, make sure you know who you're talking to. Do some research. Find out what you think their needs are before you even have a conversation. Find out who their competitors are. Figure out what part of their business is hurting the most from an economic viewpoint, and then attack it. Remember, value is more than just a price tag, and you have to illustrate your value beyond a reasonable doubt.
WHEN THINGS LOOK BAD, GO TO YOUR CUSTOMERS FIRST
Often overlooked, your customers are what made you successful in the first place. More important than new sales is retained business. The one thing you can presume about old customers is that there exists a certain level of trust that does not exist for outsiders. Learn how to create add-ons or bundles, send these people correspondence even if you're just saying hello (and reminding them you exist).
Customer relationship management software exist for a reason. You have an inside track to what customers have and don't have, if you pay attention. A business that has only a 10 percent return rate of customers is unsustainable. Yeah, we're talking to you, car dealerships.
LEADERSHIP IS EXPECTED TO LEAD, EVEN IN THE HARD TIMES
Yeah, we know things are tough. But in the end, leadership is expected to put on the bright face, spin the bad news into great news for the company, and be the anchor that everyone else clings to.
In a sense, be a cheerleader. Someone has to fulfill that role, especially if economic times are creating low morale. You will not sell a dime if employees don't believe in your message, goals, or future prosperity. You're the one that will tell them the television is dead wrong.
Be forthright, honest, but bold in your business strategy and nothing will keep you from moving forward. Except maybe a federal buyout.
Comments