How to Drive Growth and Profit in a Recession
Jan 24, 2019
By Eric Herrenkohl
To grow revenues and profits in a downturn, first take a hard look at your expenses, including payroll, and make the cuts you can make right now. Next year is not going to be an easy year. But, then, remember, all great businesses go through trials and tribulations.
To help you through this tough period, here are some practical steps for driving growth and profits in your own organization, even in a recession:
Identify revenue opportunities from current customers. Pull your team together and brainstorm ways to generate more business from your existing customer base—this is almost always the fastest way to generate revenue.
Identify future opportunities. Start with relatively recession-proof markets, ideally ones in which you already do business. Follow this up by identifying customers who still have money to spend in a recession, and create ideas for reaching out to these companies.
Get buy-in. Don’t create a plan behind closed doors. Introduce it at a companywide meeting. By involving your people in your plan’s creation, you will find they will support it.
Define how progress will be measured. People love to play and win games. Translate your vision and strategies into tangible, measurable objectives that let people keep score of their own efforts. Sales people can measure phone calls made and appointments held as well as sales closed and revenue generated. Marketing people can measure customer events held and leads generated. Measurements can also be created for departments and individuals who seem to be more removed from customer acquisition and revenue generation.
Get your plan onto one page. You can fill your white board and flip chart with as many ideas as you like, but the end result of your strategy and planning needs to fit on one page of paper. You can’t hold people accountable to a three-ring binder full of information. Done correctly, you can capture the vision, key results, timeframes, and measurements on one piece of paper.
Translate larger plans into departmental, team, and individual goals. Strategic planning can be a waste of time and money. It can discourage rather than encourage teams and individuals if grand visions are never reduced to doable plans and objectives. Help every department and team to see how to put the vision into action in their area of responsibility.
This means spending more time up front to identify the Key Results, measurements, and timeframes that each team is responsible to meet. This time will pay off many times over as you move into next year.
Provide accountability to keep people focused. The president of a sales organization could not figure out why his team’s sales numbers were consistently better on Wednesdays. He racked his brain to figure out the reason, until someone pointed out to him that he held his sales meetings on Wednesday mornings. The meetings were part motivation and part reminder. They helped his sales people do what they were supposed to do. The president took the logical next step—he started holding a daily sales team meeting—and his numbers took off.
You don’t have to hold daily meetings. You do, however, need to stick to an ongoing schedule of follow-up meetings that help to make sure that things get done well.
Create an environment in which team members hold one another accountable. Verne Harnish, author of Mastering the Rockefeller Habits, notes that team members will hold one another accountable for achieving results if they are truly committed to the goals which have been set. While this is not a substitute for leaders providing accountability, it is a powerful force for improving results in a difficult economy.
Create peer accountability in your group. Emphasize building trust and encouraging honesty within your team. If the individuals in your company are truly committed to your goals, they will not tolerate co-workers who are not pulling their weight.
Make sure to celebrate success. Jack Welch once said, “We don’t celebrate success enough.” Fear decapitates creativity; celebration and encouragement cause it to grow. Look for opportunities to reward strong performance and celebrate team wins. You don’t have to spend a lot of money--your people will appreciate that they are a part of a team that knows how to win even in tough times.
About the Author(s)
Eric Herrenkohl is a management consultant who helps to create organizations that drive growth and profit. He has been featured in the Philadelphia Inquirer, CareerBuilder.com, Inc.com, Monster.com, and Radisson Hotel’s Voyageur magazine. He serves as a strategic planning facilitator for executives that want better results out of their organizations. For more information: [email protected]