Oil prices, global supply chain crisis, the war in Ukraine, COVID-19, record-high inflation – while the economy is showing some tell-tale signs of recession, employment numbers continue to be strong; it is a confusing market. In the past, the world has experienced downturns that lasted less than a year, and also economic crises that lasted for up to several years. Negative cashflow, layoffs, unfilled vacancies, customer churn, massive drop in customer acquisitions and uncertainty about the future are just a few of the misadventures businesses typically suffer from during downturns – but each market change is unique. As can be seen in the blog “Inflation turmoil – What can you do? Corporate Strategies from Accenture, BCG, Harvard, McKinsey, and servicePath”, both history and science show that for every action, there is an equal and opposite reaction.
In these inflationary times, while many businesses and entrepreneurs will suffer, many will also thrive. Studies show that businesses that prepare and are well-positioned for growth before tough times hit hard tend to outperform companies that do not have the foresight. In order to ensure that you can weather the economic storm no matter how long it will last, it is recommended you prepare for downside financial planning scenarios; but your preparation must ideally go beyond just financial planning and operating measures.
Hope for the best, and prepare for uncertainty.
Here are a few steps for you to prepare for a downturn and to ensure that your business not only survives but also thrives during difficult times :
- Remove the constraints – Enable your frontline to modify and make changes to systems without having to rely on IT. Low-code/no-code infrastructures/tools must be implemented so that your business units can be responsive to the market changes (negative and positive) servicePath realizes that even a down market is a market opportunity. servicePath CPQ+ today is enabling MSPs and TSPs all over the world to launch new products rapidly to deal with market opportunities before their competition.
- Adapt quickly – G2’s Godard Abel recommends here that without wasting time, you organize yourself to deal with the changing world. Adapt to the expectations and demands of your customers, partners and employees. Adjust prices, hiring and spend immediately and align on new scenario plans with your leadership team and board. Pricing can be adjusted today by using advanced digital tools like servicePath CPQ+. A recent survey of sales and marketing leaders at more than 1,700 companies found that 85% of companies believe that their pricing decisions could be improved, yet only 15% believe they have the right tools and dashboards to do this. Even high performers on pricing see opportunities to unlock additional value through digital approaches.
- Don’t succumb to fear and forget your mission, vision and values – Stay focused on working towards achieving your long-term vision. Prioritize innovation and automation in order to deliver faster customer ROI and use remote and global talent to be efficient and make sure you’re keeping your employees motivated. This could also be your chance to improve your workforce – you may find that you can hire better people whom you might not have been previously able to afford during a downturn. Be kind and humane towards all. If layoffs become inevitable, do everything in your power to support your former employees and help them find new roles. Help your team do their job by making available tools that can help them be more effective and have more time to deal with adversity versus administrivia consuming most of the valuable resources’ time and energy. Systems like CPQ enable your sales team and admin teams to not spend too much time chasing approvals but instead focus on responding to the changing market conditions.
- Harvard’s “Zero-base sales capacity” – Believe it or not, many businesses even today are relying on outdated practices in making account and territory assignments. These businesses rely on backward-looking sales data and generic reports to calculate the overall market size and gauge how many reps they need and where to assign them. Automation and digital tools like Vertiv can help make more accurate matches.
- Make sure your salespeople are talking to the right people – Oftentimes, sales teams are left investing too much time and calories in potentially unprofitable customers or deals that may not be as big as others. This is mostly because these sales reps don’t have a quantified view of profitability by customer, product line, and transaction.Digital tools like servicePath CPQ+ enable businesses to avoid such inefficiencies by providing a holistic view of the deals so that the sales teams can be more focused on closing larger deals and the company hits its sales plan.
- Detect and reinforce effective behaviors – Organizations typically train all newly hired resources to ensure that all employees perform according to the organization’s set standards; this also helps ensure that every individual and team is aware of their responsibilities and what is expected of them. There are digital tools to help with this as well! A B2B technology supplier used Microsoft Workplace Analytics and other digital tools to track the behaviors of its sales reps. The data highlighted that top performers were three times as likely to interact with multiple groups inside the company, twice as likely to collaborate with peer reps, and 50% more likely to have weekly pipeline reviews with direct managers. Training on such behaviors, consistently reinforced by managers, can motivate and boost the productivity of lower performers.
- Streamline and digitize the back office – It goes without saying that in today’s digital world, digitizing and automating processes reduces (in ideal cases, eradicates) the need for burying employees in paperwork (i.e. to pull reports and manually reconcile numbers) which is often the reason for reduced productivity and inefficiencies. According to HBR, “Commercial operations groups tend to be early targets for cuts in a recession. It pays to get ahead of cost pressures. The best commercial operations groups use their staff to execute analytics that produce valuable insights, such as mining the installed customer base for cross-selling opportunities”. Businesses can benefit largely by implementing Configure Price Quote technology. By automating the CPQ process using an agile tool like servicePath CPQ+, managers can get a detailed view of every deal which can help them make the right decisions for the company. servicePath enables de-risking and helps ensure commercial viability, and strategic opportunity for deals of similar size, plus gives information regarding margin and expected win rate, all in one place. servicePath CPQ+ integrates with Microsoft Dynamics 365, Salesforce CRM, and other leading CRMs which further enables users to reduce friction and accelerate the quote-to-cash process.
The ultimate goal is to thrive in chaos and leave whatever changing market environment with deeper relationships with your customers, more customers, and your employees aligned with the mission and vision of the organization because you planned appropriately to give them the tools to be successful in the diverse market.
Solutions like servicePath CPQ+ enable you to provide new market offerings addressing the current market needs and future needs of the changing market environments. In this digital era, realizing the value of technology and your people is crucial to gaining a competitive advantage and succeeding. servicePath CPQ+ also enables your staff to be more responsive and help your organization adapt to these crazy times.
Embrace the road ahead and your organization will be bigger and stronger through any adversity or changing market.