In any economic downturn, in every sector of the economy, there will be some businesses which fail, there will be some businesses which struggle through and survive, and there will be some businesses which grasp the upside of the downturn and emerge as winners.
This guide by Cranfield University School of Management provides you with practical advice on how your business can emerge as a winner.

Be in Control

In the current climate, you may feel that you and your business are at the mercy of forces beyond your control. Some Owner Managers will feel paralysed by a sense of helplessness and simply wait for the hand that fate deals them.

"WINNERS take control of their own destiny and create the future they want for their businesses and themselves"

There is little any of us can do about the macro-economic climate. Nevertheless, as an owner manager, you can continue to control what you do in your business. You can still have an inspiring vision and communicate it to your people. You can still be proud and confident about what makes your business great. You can continue to be strong and rigorous in managing your business. You can still make plans and invest wisely. And,most importantly, you can continue to grasp opportunities that others are too timid to spot.

Be Confident

In the current climate, it’s tough to focus on the future and you may feel that you’re just existing week by week. Ofcourse, a short term agenda can be dispiriting both for you and for other
people in your business. And, at some point, in the not too distant future, there will be an upturn!

"WINNERS continue to have confidence in a clear and compelling vision of
the future."

It’s important to look beyond the short term and have a confident and clear view of the medium to longer term. Stay confident about what makes your business great. Stay confident about
your passion for your business. Stay confident about the future you will create for your business and yourself. Communicate that vision in a way which inspires other people to help you bring it about. This confidence will spread to your staff, to your customers and to your suppliers. And the effect will be dramatic.

Be Distintive

In tough economic times, some owner managers will scrap and scrabble for any business they can get their hands on just to stay in the game. The danger of this is that you lose sight of the distinctive benefits that your product or service delivers to your customers and you can end up being treated like a commodity.

"WINNERS clearly articulate the distinctive benefits they bring to their customers."

Ensure that what you offer is distinctive and that your customers are prepared to pay for that distinctiveness. Hold fast to that distinctiveness and articulate it at every opportunity. If you lose your distinctiveness, your offering could end up being treated as a commodity and you will come under severe price pressure. If you succumb to this pressure and reduce prices, you are actually giving away profit and it is very difficult to make up for that lost profit in increased sales. In fact, if you are clear about your distinctive benefits, then you’re probably better off increasing prices rather than reducing them, even if it means losing some customers. They’re probably the customers that don’t truly value your distinctiveness and it may actually be costing you money to service them!
Be Strong
The current climate means that now, more than ever, you need to be absolutely rigorous in managing your business.

"WINNERS are strong enough to take tough decisions."

Focus on the things that truly matter in your business, manage cash religiously, challenge costs and waste at every turn. Make immediate bottom line improvements by driving down debtor days, insisting sales staff adhere to a tight pricing policy, negotiating discounts with suppliers, reducing fixed costs and shedding unprofitable customers. You will need a plan robust enough to survive variances and indicators that act as early warning signals and tell you at a glance how the business is faring.

Be Wise
In tough economic times, some owner managers will simply hunker down and stop all investments. While this preserves cash in the short term, it restricts the ability to grasp the upside of the downturn and is de-motivating for everyone in the business. Other owner managers will take big risks in an attempt to drive sales.

"WINNERS continue to make wise investments for the future."

In order to do this, you need a clear plan of the future you want to create for your business and yourself. You then need the realism to differentiate between those investments which are crucial to bringing that future about and those which do not really need to be made. In particular, before moving into new markets and launching new products, consider whether you have fully exploited your existing niches. ‘Sticking to the knitting’, or in other words, selling more of your existing products and services to your existing customers and people just like them, is far more profitable and far less risky than diversification.

Be Ready
Tough economic times are also times of great turmoil and change. And change creates opportunities!
"WINNERS are always ready to grasp the opportunities brought about by change."
The economic downturn might be threatening the very survival of some companies. For more robust businesses, it presents an opportunity to redefine their sector and their position within that sector. That means reallyunderstanding your market and keeping a keen eye on your competitors. You may find that you have access to markets, potential customers, premises and people who in better times might not be so readily available to you. From weaker competitors, you may be able to acquire customers, key staff or other resources. You may even find yourself in a position to acquire some of your competitors’ businesses. In all cases, you need to be ready to seize opportunities to grasp the upside of the downturn.

Challenging times are the true test of great leadership. Now is the time for owner managers to show the vision, determination, resilience and courage of a great leader.
Please visit Barclays Commercial and Cranfield University website for more information.