Increasing interest rates, talk of a recession, what does this mean to the business?
Having lived through 16+% interest rates in the 1980’s, the .com busts of the late 1990’s, and our collective experiences a few years ago with government support necessary for major industry, what should we be thinking about?
Plan for the worst and expect the best!
A KEY LEARNING IS THIS:
Strong economies hide a multitude of poor management decisions and weak manager performance. Tough economies begin to expose risks, failures, and new challenges. So, now might be a good time to review management strengths and key decisions to ensure you can weather a tough time should it arrive.
From a technology perspective you should be hyper focused on streamlining workflow based on sound data flow – having a single instance of data truth across single or multiple systems. If you have poor workflow, a reengineering of that workflow will likely reduce process steps by 20-25% through better system use and automation. This will enable a lower operating cost.
Three key metrics that require scrutiny are:
- Cash flow and free cash within the business
- Revenue acquisition risks IE current market softening / exploring new market opportunities
- Cost structure – operational / investments for streamlining
I am a firm believer in never panicking and not fear mongering. It’s not helpful. Neither are knee jerk decisions.
We are businesspeople. We get paid to deal with the good, the bad, and the ugly. That’s our job. We need to think about, consider, and plan, ahead of what might or might not be a tough economic season.
ABOUT THE CONTRIBUTOR
David Reimer is the Principle of Reimer Consulting, a technology-based consulting firm. Measuring corporate strategies against IT capabilities and closing the resulting gap is a core skill set. Documenting and re-engineering business processes, as a precursor to sourcing and implementing CRM or ERP systems, is also a key service. We also provide software acquisition and deployment services.
As a strategic adviser, Reimer Consulting provides process advisory services to a wide range of organizations that are building a strong export portfolio.
Author: David Reimer
Interested in learning more from David Reimer? Check out the upcoming program, Scale Up Your Processes – The Key To Profitable Growth, launching January 2023 here!