Preparing for the Upturn: Part VI

In an earlier post, I had briefly dwelt on how organizations can focus on making their processes more efficient. I quote from that post:

“The downturn, then, is a great opportunity to weed these inefficiencies out of the system and trim the flab. This will create a leaner and nimbler organization which will be well prepared to grow rapidly when the upturn begins.”

What does this mean for the recovery and how does this help?

The answer lies, not in trying to make the organization even more efficient during the upturn, but in maintaining the efficiencies achieved during the downturn. It is relatively easy to trim the flab during a downturn. The circumstances and the environment compel a firm to put its processes under a microscope and examine them in detail to understand the cost benefits that can be squeezed out of them by making them more efficient.

But, once a recovery sets in, the microscope is set aside all too soon, in favour of a telescope that peeks out at the external environment, seeking out opportunities thrown up by the upturn. Furthermore, any introspection concerns itself with what internal changes are required in order to exploit these opportunities and maximize returns.

It is at this time that the firm faces a very real danger; that of the flab returning and the efficiencies built during the downturn being discarded or ignored in the pursuit of growth. Remember, after all, that this is how the flab had accumulated in the first place.

Organisations that recognize this put in place systems and processes to ensure that there is an eagle eye focus, even in the upturn, on maintaining efficiencies wrung out of their processes during the downturn. This ensures that, even while the topline growth is pursued, the bottomline is protected by sustaining cost savings derived through optimization during the downturn.

In my next post on the upturn, I will examine how talent management and talent development during the downturn can serve an organization well during the recovery.