Fantastic post by Don Dodge over at The Next Big Thing about the mentality necessary to endure tough economic times:
Chaos brings opportunity. A recession makes companies think about saving money. They consider small vendors that they wouldn’t do business with in boom times. Competitors go out of business. Be in a position to take advantage of chaos and uncertainty.
For us here at MiPro – or at least for me – the thing I notice most about navigating tough times is aspect of focus it brings to your thinking. Having worked in corporate America for nine years, I’m very familiar with the fear-based mindset of cutting costs and RIFs and cutting off your own nose to spite your face. I’ve seen the cyclical hire-fire-hire sine wave it brings to the organization, as well as the eventual distrust of senior management.
What I’m seeing now, at least here internally and in discussions with our clients, are not only talks and conversations around cost conservatism, but also talks about how we can help our clients become very proactive about being in the right place when the recovery begins. Because otherwise, you really don’t have much of a plan beyond immediate circumstantial survival.
Hunkering down blindly, with no exit plan, just means you’re looking to save cash and eventually poke your head up when the storm is over. The problem with that is unless your competitors are doing the exact same thing, you’ll poke your head up and realize they’ve left you in the dust. Sounds like something out of the Gordon Gecko school of management, but it’s not.
Businesses are getting smarter about how to move adeptly through difficult times. We continue to see HR spending in the PeopleSoft space. This strategic optimism is a slow-breaking wave, but it’s there. We hear it.
So no, it’s not only about cost. It’s about being intelligent with your talent, your employees, your information/operational systems, business intelligence (analytics) and your vision so that you invest wisely during the downturn. These investments should help you be in a great position when things turn around, otherwise you need to rethink them.
Smart companies will have some pretty amazing stories to tell when this is all said and done.
Companies operating under standard fear-based cost-cutting mindsets might not have one to tell at all.