Shortly after the Great Recession began, a billboard popped up along I-95, on the way to Philadelphia. “Recession 101: Bill Gates started Microsoft in a recession.” The campaign was meant to be an inspirational reminder that we have the grit it takes to get through difficult times. Yet, it’s also true that businesses can use downturns to their advantage.
Yes, growth opportunities exist even in recessions, and if business leaders are creative and make savvy use of resources, they can lead their organizations to greater prosperity. They can take advantage of the void created by struggling competitors and add to their client lists, launch new products and expand into new markets.
One obstacle to such growth is the lack of internal expertise, which can make getting new initiatives off the ground tough, especially if budgets are tight.
But executives can turn to independent consultants to help them seize growth opportunities. By offering top-quality expertise at economical prices, independent consultants can help businesses expand even during a market downturn. Here are four ways they can help your business seize the advantage.
Capitalize on competitor struggles. It’s a hard truth, but many businesses will falter when the economy makes a downturn and sales evaporate. For organizations willing to be aggressive and take risks, a competitor’s struggles can mean the opportunity to snap up good deals – product lines, divisions, or even sell entire businesses. An independent consultant with expertise in M&A can conduct due diligence or orchestrate the integration after acquisition.
An independent consultant can test growth ideas that evolve as part of changing market conditions.
A new economy can mean new problems your business can solve. When consumers and businesses tighten their belts, new categories of business often emerge. If your organization is able to solve new problems created by a weaker economy, you could be in a position to lead a new industry. For example, the last recession gave birth to a new category of dining. “It was a time when guests were buckling their belts, paying closer attention to their budgets and seeking more value from restaurant options. This was how the fast casual movement was born,” Scott Crane, CEO of Smashburger, told Forbes. An independent consultant can test growth ideas that evolve as part of changing market conditions.
Invest more – not less – in R&D. A strong argument can be made for using a downturn to increase spending on new product development. The idea is to get ahead of the competition as it weakens, especially since ideas often take years to come to fruition. Research teams can be staffed lean using independent consultants and then expanded as initiatives take shape. This type of flexible staffing allows businesses to test, fail, test and fail, over and over. The risk is low, but the reward is high, especially if your business can launch a fully developed product just as the economy picks up – far ahead of your competition.
In an economic downturn, no business can afford to tread water until the economy improves.
Invest in data analytics. In the era of big data, businesses are collecting and storing an incredible amount of information, and many are tapping into these data stores to improve customer interactions – such as identifying the most valuable clients and implementing programs to nurture customer relationships. But the untapped opportunity is huge. An independent consultant with expertise in data science can integrate and analyze disparate sources of data and identify new areas of growth.
In an economic downturn, no business can afford to tread water until the economy improves. Without aggressively pursuing new initiatives, businesses run the risk of losing ground to the competition.
By strategically engaging independent consultants, business leaders can continue to move initiatives forward and position their businesses for new – and more profitable – markets.