Fail, Survive or THRIVE? What will be your outcome to the current economic downturn?
What will be your outcome to the current economic downturn?
The Harvard Business Review studied the last 3 recessions finding very important information that every business leader should review.
A few of the study’s findings:
-Firms that cut costs faster and deeper than rivals don’t necessarily flourish. They have the lowest probability—21%—of pulling ahead of the competition when times get better *
-Companies that reduce costs selectively and invest relatively comprehensively in the future by spending on marketing and other key areas have the highest probability – 37% of regaining pre-recession sales and profitability levels*
-Companies that invest in, for example, marketing during a recession may produce only modest benefits during the recession but adds substantially to sales and profits afterward*
Roaring Out of Recession studied the strategy and performance of 4700 businesses during the past 3 global recessions, breaking down the data into three periods: the three years before a recession, the three years after, and the recession years themselves.
The findings are stark. Seventeen percent of the companies in the study didn’t survive a recession The survivors were painfully slow to recover from the battering. About 80% of them had not yet regained their prerecession growth rates for sales and profits three years after a recession*
Only a small number of companies—approximately 9% of the sample—flourished after a slowdown, outperforming rivals in their industry by at least 10% in terms of sales and profits growth*
Want to learn what businesses did and didn’t do that determined how the recession impacted their business? Join us for a free, informative webinar
Wednesday, June 10th 1pm Eastern