The crisis as a mirror of management

In order to win the war, it should be prepared in peacetime. It is human nature to believe the best and this is the main driving force, however, faith is not enough… do Not forget about logic and causality of each event.

The situation surrounding the global economic crisis of course one way or another will affect every business. We all are tied to customers, suppliers, creditors… and the failure of one of them will inevitably affect the financial performance of other members of the chain. In this situation, we must act very clearly, carefully and promptly.

Today is very clearly manifest the company with weak management level, which is dominated by spontaneous decision-making. Such companies are experiencing financial hit twice, in the moment, when decisions taken are not implemented in time, as these companies main weakness – lack of mobility and speed. The most popular solution in them will be downsizing. Thus the company will try to protect themselves from unnecessary overhead, trying to get self-financed. And this will be the bomb second of the action: 6-12 months, when the situation stabilize, these same companies will be in acute shortage of staff, in which virtually no development is possible.

Another category of companies is the owner, who just asked a consistency of their business, which always runs the analysis function and operational objective evidence for its holding. The analysis will determine the most cost effective goods (services) and will take appropriate action on cost control, the territorial structure of the business, product range, price proposal, which together should provide an increased contribution margin, and hence the sustainability of the business in the financial key. But most importantly, that decisions will be implemented in a timely manner and these companies will quickly be able to switch from the strategy of increasing turnover to strategy maximum profitability. And stabilization time faster return to an active takeover market, saving for this financial resource and human resource.

In the modern world, a fairly new fashion trend was the use of intuition in matters of business. And we that are common to all Slavs descend “in the pool with his head”. Not taking into account that deliberately deprive ourselves of choice: stroked the logic, ignore the facts. The truth is always in the middle. Intuition can and should be used, but do not forget about the need to prevent such a situation when in the company there is no information for analysis, established internal communication work basic managerial processes. In the absence of such functions, which ensure the reliability of the business, nothing remains but to rely on their own intuition…

The current crisis will discourage domestic – each company will show the true value of their business. And, alas, in the near future the stock market will be inundated with cheap offers from the bubble burst.

I wish all of us to learn from their mistakes!