Many pundits and investors, ranging from George Soros to Christine Lagarde to various analysts from various banks and investment companies have sounded the bell that a recession worse than 2008 is on its way this year (and just in time for US elections, how handy. But I digress.)
Anyone with any money in the stock market has seen the thrashing of the Chinese markets – anyone with any holdings in the market has seen very steep drops in their stock prices – LinkedIn took a 44% hit, FitBit at 46% hit, even Weight Watchers took a 51% hit (how is that even possible in January, the month everyone goes on Weight Watchers and similar things?).
Don’t even get me started on the oil and gas front.
All signs point to a recession in 2016. CFOs everywhere are sharpening their pencils, or more accurately firing up their Excel spreadsheets or running their SAP reports to see where they can cut. Since that is the easiest thing to do: cut costs. Of course, everyone knows that cutting costs is not the answer – not only is it detrimental to your employees, since you are letting people go and loading your leftover people with more and more work. Some of the more mercenary companies use this time to strike the fear of layoffs into their employees – forcing them to work longer and harder and under more stress. But since cutting costs is the quickest and easiest way to make things “look better” (they aren’t really any better) then that is the typical response. Get ready for cost cutting. Too bad that the CFOs yield a machete, when what you really need is your employees with scalpels. If you ask me, 1000 employees with scalpels can be a lot more effective than one CFO with a machete. But I digress again.
What is usually the first to go? Anything speculative. Anything innovative. Anything which doesn’t contribute to the bottom line, immediately.
This is the absolute perfect time to run an internal, crowdsourced, innovation program.
What is the challenge? Come up with creative ways to both grow the business AND if you’ve got the idea, cut costs as well.
This helps in so many ways:
- You involve your employees deeply in the growth process. If they are loyal to you, be loyal to them and give them the opportunity to help grow the business, no matter their role
- You get really good ideas, from some unlikely quarters. You get new ideas on making things more efficient, reducing costs. You get ideas on new products and services you can sell.
- If you implement these ideas, and implement them vocally and well, and they work, then you look great, across the board, inside and out.
Think of it as an internal crowdsourced problem solving program. Your problem is growth. And it’s your people who can solve it. all you need to do is to ask them to.
It’s the courageous company that understands that when recession hits cutting is not the answer. When the recession hits, it’s time to grow, not shrink.