Our economy in Puerto Rico seems to be showing some signs of life. While we have been talking about an economic upturn for the last 18 months, week signs have begun to show up during the last six months. Is this the beginning of the upturn that ARRA was supposed to bring? Is this the economic boom of the normal four year governmental spending cycle? The truth of the matter is that we as entrepreneurs must feel reenergized, full of hope and faith. It is up to us, at the end of the day, to make this recovery work. We as business leaders of Puerto Rico are accountable. It is our turn to step up to the plate.
After surviving one of the longest recessions since the Second World War we will probably be looking at a very different landscape when compared to other post recession periods. While each economic expansion is different, this one seems to be quite peculiar. We are experiencing low levels of employment recuperation, high levels of economic uncertainty, a strong globalized competitive environment, and a reluctance to loosen credit, just to name a few. For organizations to thrive and prosper early in this upturn, they will need to develop unconventional strategies that are up to par to today’s reality. Organizations should face this economic landscape with bifocal strategies. Focus on managing assertively their economic reality, while at the same time investing and building optimistically in future growth.
In studying post recession strategies that organizations have applied in the last three economic downturns we found the following interesting data. Organizations that maintained a balance between achieving operational efficiencies and investing in the future, emerged from the recession achieving growth quicker than their competitors. More that forty percent of the companies that followed these dual strategies were successful early in the upturn compared to twenty percent that only looked for reducing cost or twenty five percent that only invested in the future.
Companies that have been successful early in the growth portion of the economic cycle identify differentiating tendencies that contribute to their competitive position and establish strategies to gain advantage in the upturn. Some of these strategies include:
The successful companies are investing heavily on the future of their clients. They have found creative ways to be part of their client’s solution. They have asked themselves the question, what makes my client loss sleep at night and can I solve their problem. They identify opportunities to co-develop new offering and, revitalize their value proposition. They focus on nurturing an intimate relationship that increases growth. Successful companies take advantage of opportunities to acquire new technologies at bargain prices due to recessionary pressures. They invest in gaining capacity for the growth opportunities of the recovery.
Successful companies identify and exploit hidden assets. These are abilities and capabilities that the organization has developed thru the years that can be used for multiple purposes. Some of the most obvious of these are internal services that can become profit centers, logistical strengths, technologies that could become sources of income etc. In many occasions the assets are not obvious, they were not the result of conscious strategies or pursued goals.
Organizations also capitalize on their competitor’s weakness. At the end of the recession some competitors are left in a debilitative state due to the reality of the market, this is the moment for successful organizations to take strategic decision that will fuel their growth early in their upturn.
Businesses that have been successful early in the upturn have been able to assertively face today’s reality without loosing site of all the opportunities that the early future will bring. They embrace their values and at the same time challenge rigorously the status quo, excel in operational efficiencies and effeteness while focusing on the engagement and optimization of their human capital. These organizations have met head on strategic challenges with innovative strategies based on knowledge and information and at the same time are managing changes in times of uncertainty.
There are really a lot of things to be thankful for and that fuel our optimism. The ball is on our side of the court, if not now when, if we do not take it, who will.
Copyright 2011 QBS, Inc.