10 fundamental priorities to manage through the downturn
Toronto, ON -- The following 10 fundamental priorities to manage through the downturn are from the partners at...
Toronto, ON — The following 10 fundamental priorities to manage through the downturn are from the partners at PricewaterhouseCoopers LLP.
1. Take a closer look: The goal posts are moving; understand the true picture, not what you would like to believe. Get to the bottom of what is driving the business; what you do best and why. Understand how your business is being affected by the downturn.
2. Act decisively: With increased uncertainty and volatility, it is important to make tough decisions early. Focus relentlessly on your key value drivers and risks. Don’t sit back and wait; the winners will be those who position themselves to take advantage of the upturn.
3. Remember that cash is king: Ensure your finances and working capital are in good order; protect your liquidity; and re-examine your treasury, financing, funding and pension exposures. Monitor your performance against financial and non-financial metrics. Adopt a hands-on approach to cash management.
4. Focus on what really matters: Evaluate which products, customers and channels create or destroy value. Revisit your existing investment programs — what initiatives could you stop or defer?
5. Manage your cost base: Focus on enhancing operational performance; go for targeted rather than across-the-board cuts; extract better value; reduce unnecessary complexity; and consider whether or not your business model needs to change.
6. Reliable information management is key: Now, more than ever, you need the right management information; clearly defined key performance indicators are essential to ensure improvement initiatives effectively add to customer and business value. Decision-making needs to be based upon facts; speed of decision-making needs to improve.
7. Plan for different scenarios: Winners demonstrate agility and flexibility; model a range of financial, operational and workforce scenarios that reflect the impact of the downturn on your business; adapt quickly; explore your strategic options.
8. Recognize the value of your people: Regular and clear communication with employees is key to their engagement. Identify key talent and develop appropriate incentives for them; free up limited resources by outsourcing or partnering functional activities; secure strategic new talents that are suddenly available.
9. Take your stakeholders with you: Evaluate the likely impact of the downturn on your stakeholders; make sure you understand their agendas. Perception is often reality so maintaining regular and open dialogue on a timely basis is essential.
10. Take advantage of the opportunities: Don’t stop innovation or investing in those areas of growth you will need for the future. Identify new growth opportunities; surface opportunities to acquire strategic targets; and negotiate more favourable relationships. Have an eye for the future.
Consulting firm PricewaterhouseCoopers LLP, Toronto, ON, provides industry-focused assurance, tax and advisory services.