A global recession triggered by various causes is certainly bad news for all businesses in an increasingly global economy.
From increasing oil prices, to chokes in credit lines for companies to do business, all these would spell trouble for world demand, directly impacting the bottom-line of companies.
The usual tendencies for companies in their quest for business survival during these turbulent times would have been to get into the acts of headcount reviews, budget freezes and reduction, and other drastic cost-cutting measures.
However, overreacting to this situation or merely following the "order of practice of the industry" may handicap a company's future growth when demand recovers again.
What companies should do is to take this opportunity of a downturn to re-invent themselves and consider how best to position themselves for global recovery when it happens.
There is usually a silver lining in all recessions, and that it is the time far-sighted companies are triggered to re-invent themselves in terms of practices, processes and human resources through business improvement practices.
Companies could use a myriad of business improvement methodologies such as Lean, Six Sigma or business process re-engineering to reap current and future benefits during a downturn.
Lean, largely associated with the elimination of the 7 business wastes, could be used to review current processes and practices for immediate cost reductions without reducing valuable headcount.
Examples of Lean techniques worth considering could range from the simple 5S (a methodology to ensure that what's needed is known to be available, and what's unnecessary is made known for alternative uses) to value stream mapping which could be used for identifying the 7 business wastes for elimination and process improvement.
Six Sigma, a well-known methodology typically used for achieving zero defects, could be used to discover root causes of high business expenditures so as to facilitate their reduction and control.
Even the good old process re-engineering practices could be used to review and analyze current business processes for streamlining and improvement.
Also worth noting is that business improvement activities involve teams and encourages teamwork.
Such activities would most certainly improve employee morale during the gloom of a global downturn, while at the same time increase their intellectual capacity and create a learning organization.
Don't forget that it is also the people that make the company, and improving their morale in turbulent times will go a long way in firming the foundations for good times that will come again.
The bottom line of this perspective on how companies can survive an economic recession through business improvements is that business improvement methodologies provide a valid alternative to the "layman version" of cost-cutting measures.
These methodologies provide a more prudent approach for reviewing the business during a downturn for long-term survival.
They also enable the invigoration of companies for the next wave of growth.
The possibilities are endless.
It is up to companies to be innovative for their survival during a recession and beyond.
From increasing oil prices, to chokes in credit lines for companies to do business, all these would spell trouble for world demand, directly impacting the bottom-line of companies.
The usual tendencies for companies in their quest for business survival during these turbulent times would have been to get into the acts of headcount reviews, budget freezes and reduction, and other drastic cost-cutting measures.
However, overreacting to this situation or merely following the "order of practice of the industry" may handicap a company's future growth when demand recovers again.
What companies should do is to take this opportunity of a downturn to re-invent themselves and consider how best to position themselves for global recovery when it happens.
There is usually a silver lining in all recessions, and that it is the time far-sighted companies are triggered to re-invent themselves in terms of practices, processes and human resources through business improvement practices.
Companies could use a myriad of business improvement methodologies such as Lean, Six Sigma or business process re-engineering to reap current and future benefits during a downturn.
Lean, largely associated with the elimination of the 7 business wastes, could be used to review current processes and practices for immediate cost reductions without reducing valuable headcount.
Examples of Lean techniques worth considering could range from the simple 5S (a methodology to ensure that what's needed is known to be available, and what's unnecessary is made known for alternative uses) to value stream mapping which could be used for identifying the 7 business wastes for elimination and process improvement.
Six Sigma, a well-known methodology typically used for achieving zero defects, could be used to discover root causes of high business expenditures so as to facilitate their reduction and control.
Even the good old process re-engineering practices could be used to review and analyze current business processes for streamlining and improvement.
Also worth noting is that business improvement activities involve teams and encourages teamwork.
Such activities would most certainly improve employee morale during the gloom of a global downturn, while at the same time increase their intellectual capacity and create a learning organization.
Don't forget that it is also the people that make the company, and improving their morale in turbulent times will go a long way in firming the foundations for good times that will come again.
The bottom line of this perspective on how companies can survive an economic recession through business improvements is that business improvement methodologies provide a valid alternative to the "layman version" of cost-cutting measures.
These methodologies provide a more prudent approach for reviewing the business during a downturn for long-term survival.
They also enable the invigoration of companies for the next wave of growth.
The possibilities are endless.
It is up to companies to be innovative for their survival during a recession and beyond.
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