The top 5 business opportunities in a downturn
07-May-2009
This our summary of a blog that appeared in the Financial Times on April 29.
In a downturn, it is natural for business leaders to want to mitigate the impact on their current core business – e.g. dealing with slowing demand, falling prices, and scarce credit.
However, it is also important to remember a counter-intuitive truth – that the worst of times for the overall economy, can also be the best of times for individual firms to create long-term value.
Your ability to seize opportunities in a downturn - depends on your current strategic and financial strength - and whether you have the agility to exploit them.
The top 5 business opportunities are:
- Market opportunities.
Respond to customers’ shifting demands, and offer new products or services that better meet these new demands. There is also the opportunity to poach clients from struggling rivals.
- Resource opportunities.
Many struggling firms are being forced to sell assets at low prices to raise cash. This creates opportunity for firms who have the financial strength to acquire those assets.
- Portfolio opportunities.
Make the hard choices on your portfolio of business units, products, and customers. What business should you be in? What business should you no longer be in? What new business do you need to get into? Make clear decisions on what are going to be “core”, and “non-core” activities for your business going forward.
- Transformation opportunities.
The 5 competitive forces that shape industries are rapidly changing in many cases. This provides an opportunity to rethink your business model - and potentially transform your firm for greater success in the future.
- Operational opportunities.
Use this time to identify ways to improve the efficiency of your core processes, and to improve your ability to implement your chosen strategy - by incorporating best practice strategic execution disciplines.
Chief Operating Officer - Global Operations - RESULTS.com
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