Steering your business through a recession.

Managing your business is not an easy task at any time. In a recessionary environment, things get even trickier. Quite often, the best thing any business owner can do is get back to basics i.e. managing cash, managing costs and thinking about the future.

 Tom Stewart from Booz & Company provides some sound advice. He suggests business’ owners and managers should concentrate on three things (1) liquidity, (2) operational costs and (3) planning for the future. Liquidity means having enough cash resources to pay for goods and services as required. Having enough liquid resources to survive the recession is essential. Focusing on operational costs is also very important. A lean, mean organisation has a better chance of survival. Finally, a view of the future helps business owners and managers identity how and where the business can grow as recession peters out.

It’s quite a difficult task to overcome the ‘paralysis’ of focusing on reducing costs now and not having a clear view of the future. According to Tom Stewart, overcoming this paralysis is a must, as if your business does not, another will and you will loose out. He suggests that business owners and managers while recognising the truth of the current economic climate, should also be optimistic and motivate staff to find ways to participate in decision making and planning for the future. One failure to avoid is cutting costs without a view of the future. This can result in an under-resourced business which will have difficulties as economic growth returns.

If you want to see the full video by Tom Stewart click here:


About martinjquinn

I am an accounting academic, accountant and author based near Dublin, Ireland.

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