Strategic & Tactical Changes Required for Companies Caught in the Throes of a Global Recession in 2023
In 2019 the Global Economy took a nosedive and economies around the world collapsed. The impact of this downturn became known as the Great Recession. In the aftermath of this global downturn, many companies began to re-evaluate their business strategies to ensure they would be able to survive a similar crisis in the future. Many of these companies have managed to overcome the problems they faced, but some continue to struggle to maintain their profits.
As mentioned above, some companies have managed to bounce back from the recession, but many others did not. So what are those companies that were able to survive doing differently than others? According to Daphne Koller, a Professor at Stanford University one reason for success may lie with how well their employees handle stress during periods of economic uncertainty or crisis situations such as a recession; other factors like company culture could play into success as well.
In 2023, the global economy is on track for another major downturn. This time it seems likely that we will see less volatility from country-to-country and more stability within individual countries; however, there will still be plenty of uncertainty and risk factors involved which means companies in strategic management consulting UAE need to offer new ways of operating and responding to challenges if they want to survive another recession.
Role of Strategy Consulting Dubai During Recession
Understand What to Prioritize
The first thing that needs to be done is prioritising what you do in your day-to-day operations. This means making sure that only those activities that bring you value are performed. Some companies find that they can scale back their operations because of the recession, but others find themselves doing more than ever before because of it. There are also those who choose not to change their operations at all and continue with the same strategy as always, which may or may not prove successful for them in the long run.
Restructure the Business Model
If you are going through a major financial crisis or if your company is failing, it may be time to restructure your business model so that it focuses on areas that can generate revenue and profits in the short term. This means cutting down on non-essential costs, such as research and development, education programs, charitable contributions and other initiatives that don’t directly impact revenues or profits. It also means focusing on products and services that have proven track records of profitability in the past — even if they require more investment up front — instead of new products or services that may not be as lucrative initially but have potential long-term benefits.
Strategic Partnerships and Alliances
A partnership is a relationship between two or more organizations where they agree to cooperate towards a common goal. Partnerships can be formed between two companies, but they can also be formed between a company and an academic institute, or even between two universities.
The most important element of a partnership is that the parties involved have equal rights and obligations. They should also share an equal amount of risk, benefit and control over the partnership project.
In a global recession, it’s unlikely that your company will be able to develop all the products you need on its own. Therefore, it would be wise for businesses to form strategic partnerships with other organizations in order to gain access to resources that they would not normally have access to.
A good example of this would be forming a partnership with another organization that has great expertise in research and development (R&D), but lacks production capabilities; in this case, your company could provide manufacturing services while your partner focuses on R&D activities. Proper strategic consulting Dubai will enable you to implement this strategy by getting connected with the best investors or partners.
Use Digital Technologies to Create Business Opportunities
Digital technologies such as AI, blockchain, big data analytics and the Internet of Things (IoT) will continue to shape the future of business. In fact, these technologies are advised in strategic management consulting UAE as being the key to helping businesses navigate through the global recession.
For example, AI can be used for predictive analytics which will help companies improve their forecasting capabilities and make better decisions about how much inventory they need to order from their suppliers or when they should hire new employees.
Blockchain can also be used to improve supply chain management (SCM) systems by making them more efficient by automating processes such as order processing or payment settlements which could help save money on transaction costs during times of high inflation due to currency devaluation.
Find New Revenue Streams and Diversify Sales Channels
In a global recession, companies must find new revenue streams to supplement their current business model. This could mean diversifying sales channels or offering products that are not currently offered within your industry niche or target market (e.g., offering products that appeal to consumers outside of your typical customer base).
An established company in strategic management consultancy in UAE successfully diversified your sales channels by analysing the market gap and the competition. This way you can spread out across multiple platforms (e.g., online vs offline) and increase overall revenue potential for your company.
Acknowledge The Current Market Scenario And Revise Your Pricing Strategy Accordingly
To succeed, you need to know what is happening in your industry right now. You need to know whether there are any market trends that point toward higher or lower prices, and how they are affecting other businesses in your industry. Once you understand these things, a step towards the right strategic consulting Dubai is to adjust your pricing strategy accordingly.
For example, if there are signs that customers are looking for lower prices, then it would make sense for you to decrease your prices accordingly while still maintaining a reasonable profit margin. However, if there are signs that customers want quality products at reasonable prices, then it would make sense for you to raise your prices while still maintaining a reasonable profit margin.
Strategic Management Consulting UAE Enables Your Business Survive This Year’s Recession
In the article above you have been provided with some insight into just a few of the strategic and tactical changes required to enable your company to survive in this global recession. This was written as an experience from strategic consulting Dubai responding to past global economic recessions, looking back on the tactics that businesses used to get through the hard times.
There are other actions and decisions that may prove helpful as you position your company for success in this coming global recession. We encourage you to build a solid base of knowledge about how companies will act during economic hardship and how this will affect the environment for your business. Volonte is your go to among leading strategic management consulting firms in Dubai. When integrated into your existing business strategy formulation, our consultants can help you survive these tough times. Call us @ +971 56 160 6762 to learn more about business management strategies that twists the fate that would have been as a result of recession.