Thursday, October 9, 2008

Managing In a Recession

"It is time for us to stand and cheer the doer, the achiever, the one who recognizes the challenge and does something about it." - Vince Lombardi

This quote seems timely for the current treacherous environment. I think the most natural reaction is this: because I am not directly involved in the capital markets, I will steer clear, stay away, keep on keeping on. I don't think any business in any industry will be able to address this current crisis in this innocent way because of the tremendous ripple effect it will have on consumers.

The hard part is ascertaining what to do and when. Some things seem obvious and essential.

Everything is on the table. Bring all operations to the surface - the strategic plan, the marketing plan, the advancement plan, the learning plan, the growth plan, the succession plan and question all of the assumptions that fueled these plans.

Investing in human capital in appropriate. Build the capacity and expectations of each person working for you. In analyzing the plans, a combination of defensive and offensive thinking will be vital. Plan for at least a 20% decrease in customers. But, don't just shrink accordingly. A better tact is more nuanced. Find efficiencies in everything. If you don't outright cut some things, then find out how you can get more out of the outlay. Look from the smallest routine item like coffee, drinks, and snacks which were benevolently available to energy efficiencies in plant management to combining tasks and roles so that much more is accomplished with the labor force that is in tact. Been waiting to go paperless? Now it is the time to highly leverage free, creative, paperless communications - more intimate, higher quality, more convenient for sender and receiver, file-able and retrievable.

Attracting new customers is vital because of the loss of customers that will occur. Finding ways to build relationships and add value in ways that do not cost is very important. Quality, supportive, authentic relationships with our customers is paramount. Constantly adding value above and beyond expectations will keep people buying from you. Email is free, phone calls are free, handwritten notes cost next to nothing. Build relationships. Everyone in the organization should become relationship savvy and relationship sensitive. Reach out. Be visible. Have voice that illustrates your value.

Innovate. Now is the time to invest in distinguishing systems, distinguishing messages, and distinguishing products. Customers will become more value conscious than ever before. They will be searching to spend wisely and to become involved with organizations that are efficient, effective, and progressive. Spending money for less will feel painful, wasteful to customers. Innovation is the antithesis of inaction, staying out of the way, steering clear. Innovation is about intentional, disciplined re-thinking, re-considering, re-strategizing based on changes in the current environment. Innovation is essential like never before.

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