Upturn Thinking in a Downturn Market
Nearly all companies are feeling the pressure of higher energy and raw material costs. In the midst of these difficult economic times, leaders naturally turn to cost cutting measures and restructuring efforts to control expenses. These actions should be applauded and have been responsible for the relatively shallow downturn of the past year. However, recovery from a down market is not enough to deliver sustainable profitable growth over the long-term.
Building long-term thinking into the restructuring process is critical. Successful companies build in “upturn” thinking even during the deepest downturns. Strategic planning is about creating a management system that drives both short-term and longterm decisions to bring out the best in any organization. Leaders who build this strategic tool into the fabric of their organizations will benefit the most.
Building upturn thinking in a downturn market means creating a management system that drives day-to-day operating decisions to address short-term results and prepares the company to take advantage of long-term opportunities. Keep in mind that:
1. It’s ongoing… in today’s fast changing environment managers need to remain flexible allowing for decision making as new issues arise. The process calls for constant and relentless follow up, and continuous refreshing of the strategy.
2. It’s incremental… as time goes by, management skills to identify and proactively act on business opportunities will improve, and better decisions will be made more often and with more confidence. It is a continuous improvement process over the long-term.
3. Its efficient… the goal is to create a culture of accountability focused on both short-term and long-term results. This accountability focuses the organization on what is most important, while eliminating wasted time and money spent on low priority projects.
The strategic planning process should be flexible, allowing the company to change course as unexpected events come up, or eliminate unsuccessful initiatives and replace them with new opportunities. By measuring what matters at all levels of the organization, it keeps everyone alert to the goals and tasks at hand. It challenges assumptions regularly so that adjustments can be made as necessary. Lastly, it provides a forum for open communication and enhanced collaboration throughout the organization.
Balancing long-term and short-term thinking in a downturn market will help you stay ahead of competitors so that you are ready when better times return.