Recession prediction is a booming business these days. Are we? Aren’t we? Where are we headed? Flags are being raised, and key decisions are being made that will shape the course for many companies.
Cost reduction initiatives are topics in many boardrooms this summer, and for good reason. However, these programs aren't going to look like the cost-out actions from previous downturns, especially with the current fight for scarce talent. Labor reduction will be challenging proposition for many.
Yes - cost and cash controls are also increasingly important. If you haven't started thinking about your next budgeting cycle, start now.
This cycle it will be important to take a close look at your customer and vendor ecosystem while working through cost management initiatives. Protect those relationships that matter most to the business and find new ways to strengthen them. Competition will be fierce for the top-line as consumer sentiment shrinks. Take care with costs related to serving your key relationships – you do not want a key partner looking for an alternative.
Fortunately, better analysis can help. Good customer, vendor, and product/service analytics show the interplay between costs and benefits of these relationships, helping provide insight to what matters most. Companies doing it well are engaging with their stakeholders and identifying opportunities to form stronger bonds to buffer against a downturn.
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