Grow your business out of the recession

Spending money in a recession can seem a daunting and somewhat unwise prospect. Committing ourselves to cutbacks is often regarded as the common sense way to defend profits and reduce overall risk to the business.

But while a cold look at your cash flow is important in preventing unnecessary leaks, reducing your spend in the wrong areas could only serve to undermine your market presence, with potentially disastrous long-term effects. It’s about knowing what’s good for your business and channelling your spend and efforts into resources that will deliver the best return.

Don’t use the recession as an excuse

All organisations need to make astute decisions when it comes to finance, but don’t be tempted to use the recession as an excuse. If your business has been and is continuing to grow at a consistent rate then why pull back ‘just in case’?

We’ve been in a recession for some time now, so chances are that drastic measures have already been taken, but when drawing up your budget for the following year, be kind to your business. If performance is on track thus far, why behave as if the axe is about to fall? It’s never wise to throw good money after bad, but don’t let fear stop you from making appropriate and necessary investments.

Spare a thought for your marketing

If we look at companies like Aviva that have undergone a high profile rebrand, it’s easy to see why shouting about who you are is essential for the business. Few companies can afford to spend so heavily, but there’s no doubt that aggressive marketing pays off. Keeping a high profile communicates that you are successful within your market space and therefore a competitive business proposition.

When working with lesser budgets, it’s simply a matter of being clever about what you spend your cash on. If you make informed choices about your brand presence and lead generation tools then it will be more straightforward to justify what you’ve spent and more importantly, see the right results. Always have a fixed and realistic lead target in mind for direct marketing activities and if you don’t think it’s achievable then don’t spend the cash. There will always be another, better opportunity.

How efficient are you?

Growing your business isn’t about throwing money around. Indeed many businesses fall into the trap of increasing headcount or resources, without taking a look at the overall effectiveness of current business practices. For example, is your project management methodology allowing you to complete projects within time, or are there inherent inefficiencies that prevent this? Are you relying too heavily on spreadsheets or multiple software systems that don’t talk to one another?

Equally, do you employ people to manage administrative tasks that could be managed via process automation or tools that consolidate information? Many employees could bring greater value to your organisation if they were focused on more useful tasks.

Appropriate use of software, alongside a revision of current practice could bring extensive rewards to your business. Again, any new technology will require some initial investment, so make sure you’re armed with key business objectives and expected return on investment for your business.

Developing your talent

Growing your business from within is the secret weapon of many a successful business. Working to develop your own people allows you to hone in on brand loyalty and turn a job into a career – ensuring longevity with your organisation. By ‘growing your own’ you don’t have to needlessly spend time on expensive and time-consuming recruitment campaigns, or lose time in induction programmes that are a drain on HR resources and your more highly paid employees.

Do you have career plans in place that set specific objectives for your employees, relating to both the business and personal aims? Do you have a proper appraisal and assessment system that helps employees achieve their objectives through in-depth competency management?

Setting up a new way of doing things can meet resistance, so if you do decide to rejuvenate your existing appraisal structure, make sure that it’s communicated well. Start with ensuring buy-in from senior execs and line managers, so that they can support employees through the process.

Talk to your employees

There’s nothing like a recession to cause a drop in morale, which more often than not negatively impacts business outputs. There’s likely to be speculation about pending redundancies that is often perpetuated by an unforgiving rumour mill.

Addressing gossip head-on with regular business briefings, open door policies and senior exec drop-in days will be invaluable in demonstrating your commitment to employees and helping you to talk them out of the recession. Be honest with them that hard work is required and where cuts have been made, take the time to explain the rationale behind them and give realistic timescales for returning to normal. No-one likes staying in budget hotels or getting the bus, but if people appreciate the whys and wherefores then attitudes can and do change.

In summary

Deborah Meadon, speaking on newbusiness.co.uk, sums it all up when she comments that the recession isn’t a reason for businesses to fail. In short, if the recession kills a business off, then it shouldn’t have been operating in the first place.

What this means is that by taking the right steps to protect your business and investing wisely in future growth, you have every chance of fighting fit and growing your way out of the recession.

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