Expand; Don't Contract
TIP OF THE WEEK
It seems counterintuitive, but great companies expand during slowdowns; they don't pull back. Remember, all competitors within an industry are dealing with the same challenges. As a result, the weakest of these organizations will be going out of business, losing critical funding and cutting operations, and/or letting go of critical but expensive assets and people. "All of these things open up holes in the market that a clear-thinking organization can fill," says David Giannetto. "As these businesses fail, the market you are competing in may very well contract, and the death of your competition actually creates holes in your market—ones that your organization can fill—so you can actually expand through the slowdown. When this happens, you will want to be there to snatch up the customers of your failed competition. Be prepared to increase your sales, marketing, and advertising efforts during the slowdown to make sure that newly 'available' customers reach out to you first."
David Giannetto is the director of Cohn Consulting Group's Enterprise Performance Management Practice, and has been with J.H. Cohn LLP since 1999. He is responsible for helping client organizations improve operation efficiency, management effectiveness, customer satisfaction, and systems integration through the implementation of the latest performance management methodologies. Giannetto is also the author of The Performance Power Grid: The Proven Method to Create and Sustain Superior Organizational Performance.