You’ve probably heard the warnings by now: Many experts believe an economic downturn is right around the corner in 2019. At KRESS, we can’t tell you when a slowdown, downturn, or recession will happen. We aren’t fortune tellers! But what we do know for a fact is that, at some point, the economy will be worse off than it is right now. It could be years from now, but it could also be tomorrow.
Is your organization ready for that?
While it’s almost certain the next recession won’t be as severe as the Great Recession a decade ago, it’s clear from the experiences of Ford Motor Co. and others that took strategic action early on before that downturn hit that preparing now for the next recession can reduce its negative impact on your business—and possibly set up your business to thrive and grow in spite of it.
Here’s how you do it:
- Heed the warning signs.
Trade tensions, stock market volatility and bond market concerns are sending worrisome signals—as is a recent spate of corporate layoffs. Economists and financial experts have been warning for some time that we’re overdue for an economic “correction.” Business cycles typically run every seven or eight years, and the last recession officially ended in June 2009. The current economic expansion, which is in its 10th year, is the second-longest on record.
All signs point to the correction coming soon, so don’t be surprised when it happens.
- Plan ahead.
There’s no time like the present to plan for the near future. Try to identify opportunities to better align human capital with overall organizational goals, streamline processes, and seize opportunities to grow. Do you have the right leaders in the right positions to help you weather the storm? How can you reduce costs without compromising the quality of your product or service? Start thinking about what’s going to become critically important when business slows down.
- Cut expenses.
During the next economic downturn, your organization’s revenue might plummet, and you likely will have to make spending cuts. You can take some pressure off by developing a priority list now. You don’t have to immediately start slashing pay or making layoffs—that would be crippling for morale. But do what you can to increase flexibility and minimize obligations.
- Build trust.
Be transparent with your employees about what’s happening. Don’t try to hide hard truths from them—that’s almost as bad as lying to them. Instead, be up front about any challenges the business is experiencing and give them opportunities to be problem solvers. Try soliciting ideas for cutting costs and raising revenue. It takes teamwork to make it through to the light at the end of the tunnel, so keep your team close.
- Hire the right people now.
In order to be ready for any challenges that may come, it’s critical to ensure that the people you’re hiring now work out for the best. That’s where KRESS can help. We complete fast, discreet background checks and drug tests so you can move quickly based on accurate information during the hiring process. The slower and less accurate your screening results, the less likely you’ll be able to hire the best talent when it becomes available.
For a consultation on how KRESS can help your business prepare for what may come, contact our team of screening experts today.