Planning for upturns and downturns in the business cycle can mean the difference between prosperity and failure. Forewarned is forearmed, and business executives should plan for the worst as well as the best.
There are three fundamental steps one can take to ensure their companies not only survive but thrive during economic turbulence.
All companies want to improve their efficiency, but many find it difficult to identify the gaps in their business practices that are preventing them from achieving significant breakthroughs. One remedy for this malady is to use an external resource that isn’t blinded by the company’s tradition and norms. A financial consultant with a fresh, outside perspective, sophisticated analytical skills and new technology can give an immediate boost to your company. A strong advisor will be able to sort the high value opportunities from the low-payoff activities, develop the plan to achieve them and have the capabilities to execute the plan within your organization.
The worst time to start planning for a crisis is when one is actually happening. A little foresight can mitigate the damage caused by economic turbulence, especially if companies use the right analytical tools.
One such tool is a sensitivity analysis, also called a “what if” analysis.
Having a financial consultant pour over your company books can cause anxiety and friction. Staff get nervous when a consultant is reviewing their work. They may worry mistakes will be found, making them look bad or incompetent.
Yet the reason for hiring an outside consultant is not to make anyone look bad but to uncover issues holding the company back and work with finance staff to improve its financial acumen.
A simple analysis can help keep your business’s key initiatives focused on your highest return area.
You have set the budget, agreed on initiatives and even have a long term plan. But how can you validate your company is on the right track?
