Market slowdown, recession, need to downsize the team to meet profit targets. But…the work that needs to be done isn’t downsized. Sound familiar?
When a market downturn hits, this becomes the standard playbook as companies try to meet their profit expectations by downsizing their teams and basically riding out a downturn. The problem is in most cases there’s still plenty that needs to be done. While some initiatives on the margin are eliminated, this is usually never enough to compensate for the reduction in workforce.
I would argue a downturn is when activity needs to be ramped up. As a long time consultant and former Chief Strategy Officer, the difference between successful and unsuccessful companies is unsuccessful ones only focus on cost cutting. In contrast, the successful ones – the ones that come out stronger than the competition – cut costs but also think about how they can grow, outmaneuver the completion and re-invent their business.
Sounds daunting, but it’s an imperative.
The challenge here is a lack of resources to work on these initiatives and possibly fresh thinking and a different set of skills. But you are downsizing, so now what?
One way to ensure your business can survive a downturn: Hire independent consultants to cover the gaps. In fact, this could be the best way to recession proof your business and continue its growth.
Independent consultants could be the best way to recession proof your business.
For today’s executives, independent consultants may be the powerful, hidden asset that will help their organization survive such a scenario.
Over the last several years, the independent workforce has become an increasingly popular talent management strategy because it offers significantly greater flexibility and higher expertise at lower costs.
This new, agile workforce has grown substantially since the Great Recession, when many displaced professionals turned to consulting and contract work. And we’re not simply talking about Uber or Lyft drivers. Currently, 6.4 million Americans provide professional services to corporations, and that number is poised to grow even more. Fifty-one percent of global executives say they plan to significantly increase their use of contingent workers, according to research by Deloitte.
The top reasons for embracing the independent workforce during a downturn.
It’s clear that companies are embracing the independent workforce as a cost-efficient way to get work done while continuing to improve their bottom lines. But this approach to talent management is especially valuable during a downturn, as it offers businesses several important benefits.
- Flexibility. On-demand talent enables organizations to be agile. They can be contracted to work only as needed on special projects or during busy periods. Or they can be deployed to test new initiatives with minimal investment as well as help organizations pivot quickly to take advantage of emerging markets or trends.
- Expertise. Independent consultants are a reliable source of deep knowledge and highly specialized talent. An executive’s industry experience can shortcut your path to a potential acquisition target, for example.
- Cost savings. As the economy contracts, businesses need to find ways to cut costs, often by reducing staff levels. Independent consultants can help fill the gaps and keep businesses humming at a significantly lower cost.
Independent consultants are an advantage in any environment, but they are particularly valuable in tough times. We’ll explore in greater detail how they can be deployed in each of these scenarios in our next two posts.