Global researcher Gartner observed something interesting during the 2007-08 financial crisis. They found that the 'modern winners' of economic turns do not simply cut costs to weather a storm.
In their chart below, you can see that the best-performing companies made a turn for growth right at the most difficult of times. Companies that show true growth longevity give themselves a competitive edge by not maintaining the status quo. They don't hold their breath during a crisis. Success comes from discipline, focus, and the timely use of resources.
According to Gartner: “When faced with uncertainty, leaders might halt investment or cut costs until signs are clearer. But Gartner analysis of firm growth during and after the 2008 economic downturn shows that the companies that resisted the urge to cut costs across the board, and instead continued selective investments in core capabilities, recovered sooner and grew faster in the following decade.”
Gartner shows us that there were two clear segments during the most significant recession we've ever had since the Great Depression. There were those companies that were just waiting it out. And there were those that used the opportunity to get lean and mean. Those who were prepared for when the recession pivoted, were the clear winners long-term.
This sentiment was also shared during a recent webinar on best practices in times of uncertainty. Speakers advised that downtime, such as we are facing now, is an excellent time to research, data mine, and work on the business of your business.
Leaning Into Downturns
What does this look like?
- Hotels and entertainment venues are taking advantage of low visitor numbers to paint lobbies, redo fixtures, and catch up on maintenance in common areas
- Small businesses hoping to scale are reinvesting in workflow programs, updating payroll and billing systems, and finding ways to automate
- Enterprises are switching marketing off and turning communication on to work on their long-term brand by showing genuine connection to employees and customers during a crisis
- Process automation and system integration upgrades are being rolled out - technology is being invested in to give companies the edge to pull out strong when the tide turns
We Know Shipping
If your business ships and you do not want to simply "weather the storm", but prefer to take advantage of this time to get lean and mean, we can help!
In our post Shippers Fight Back on COVID-19 Supply Chain Disruptions, we identify three specific tools shippers need now to become aggressively competitive and to prepare for when the recession subsides:
- Use Expedia-like rate shopping tools
- Maintain state-of-the-art visibility into supply chains
- Use software to enable fast recourse on incorrect invoicing - this alone saves shippers up to 15% in unfair overcharging
Our customers get very excited at the types of integrations and capabilities our shipping software has. We enable them to take control of carriers with pricing and stay on top of them with service and invoicing.
We outline how we do this in our post Grow Your Business With TMS, but a quick recap here is that we have a high volume online retailer that in the space of a few months, went from 8 staff handling order taking, processing, shipping, and auditing to 3 staff members by using FreightPOP. This was 200 labor hours they were able to allocate elsewhere throughout their business each week!
You can become more efficient with the headcount you have and set yourself up for growth as we eventually turn out of this recession. If you ship, you need a system like FreightPOP. This is about growing and putting yourself on a new trajectory as a business by becoming far more efficient.
Gartner experts point out that agile companies perform well. Gartner's Senior Vice President recently remarked: "In today’s business environment, being right is only half the battle. Companies also need to be fast. When the environment changes, the companies that are fast at making adjustments are the ones that will win.”
Our shipping software helps you conduct business faster, with more insight into your overall supply chain, giving you troubleshooting advantages, and the ability to assess and communicate at unprecedented levels.