Business Sustainability: What Did We Learn from the Economic Downturn?

image: thinkingCompanies across all industries took extreme measures to mitigate the financial pressures and risks of uncertain economic times.  Our professional consulting practice observed many companies taking cost-cutting actions that were absolutely necessarily at the time but seem strange in today’s more positive environment.  The question now becomes: Did we learn from our past actions, or are we doomed to repeat the same mistakes?

A recent article featured in Logistics Viewpoints discusses one company’s journey back from recessionary action to business growth strategy decision making.  Sensing a turn in economic fortune, executives at Nestle debate the appropriate strategy to capitalize on returning consumer demand.  Like many product delivery companies, two overarching business growth questions rise to the top, each leading to its own risk/reward.

•    Should we focus our attention on market expansion and product customization, thereby increasing supply, distribution and operating cost?

•    Should we focus our attention on operational efficiency and current product offering scale, thereby decreasing supply, distribution and operating cost?

Choose right and your business is on its way to success; however, choose wrong and you could be a ‘slippery slope’ back to the constrained days of the recent past.  So how does one choose?  What questions need to be asked?

Top-Line:
•    Will new market opportunity become available?
•    Will sales increase through improved product delivery or new product offerings?
•    Will new consumer segments be attracted to company products and services?
•    Will overall sales increase?
 
Bottom Line:
•    What will be the resources requirements to implement sustainable change?
•    How will each decision affect exiting processes?
•    Will material or service supply cost increase or decrease?
•    Will overall long-term variable cost increase or decrease?

Strategic:
•    How are our customer stakeholders aligned?
•    How are our supplier stakeholders aligned?
•    How will change be received by our internal stakeholders?

Our sustainability consulting believes no one decision should be made in isolation.  Leveraging a comprehensive business sustainability plan as a platform for all decision making and engaging stakeholders, your business has a much greater chance of choosing correctly.

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