During a challenging business environment, business as usual doesn’t always work. Changing times can require changing and adapting strategies and tactics. It can also mean retooling operations, products, and services. The quicker a business accepts that change is necessary, the sooner the business can adapt for survival and success. We humans get comfortable and often resist change, especially as we get older because it takes effort to learn and to adapt. The pitfall for businesses is to keep trying to do what worked in the past and to remain the same when the market conditions and preferences change. Opening our minds to learning and discovery are key to adapting.
Research and development activities and departments are often shut down when budgets become tight or when companies have been around for many years. However, it’s the research and development activities that will allow the business to get back into learning and discovering the current market needs, conditions, competition, and to create solutions for the business to adapt. Research and development enables the business to stay relevant to the market by ensuring that the business is offering the products and services to the right market, at the right price, and in the way that the market wants them. Without research and development activities, a business eventually becomes out of touch with the market and becomes irrelevant or obsolete.
In challenging economic times, the approach is to become lean and mean. This will make the business more effective and efficient by reducing costs and positioning the business for growth. To become lean, look at reducing unnecessary costs, especially overhead and other ongoing costs. Economizing can include paying down debt, especially when interest rates on loans will rise, and deferring large expenses that aren’t critical or urgent. Look for automation, software, or processes that can reduce the time and cost to produce results. This can free up workers to do higher-level work that software and machines can’t do, thereby adding more value to the business or customers. This was the lean part.
In terms of getting mean, look to target a niche and become dominant in it. This will strengthen the position of your business in the market place and differentiate it from competitors. Become more indispensable in the eyes of your customers and potential customers so that they only want to work with your business. If your business is able to,build up savings so that you have reserves that you can spend in an emergency as well as to buy assets at a discount. During tough times, other businesses will disappear, and they may have equipment, locations, and more that you might be able to acquire for less than normal. They may have staff with knowledge and skills whom you could hire, especially for key positions, since they will be looking for a job. While you build up your reserves, identify the assets that you would like to acquire so that when the opportunity presents itself, you can acquire them.