Declining orders and dwindling sales are part of every entrepreneur’s or manager’s everyday life. It is quite normal for a company to not always run smoothly. Small dips are a good opportunity to analyze current business models and to reach out for new opportunities. Nevertheless, companies are often lacking the so-called sense of urgency even in crises, or they are simply too concerned with themselves instead of taking the time to take appropriate measures. But how do you react properly to a decline in sales, what should you do if customers are getting fewer and fewer and how can you turn crises into opportunities?
How do you properly react to a decline in sales?
If a crisis is imminent, the first thing is to keep calm. Before you contact your bank and tell your bank advisor that things are going badly, you should carefully evaluate and assess the situation. If you know all the data, facts and possible solutions, you will be in a much better negotiating position and, in the best case, can get the necessary financial injection at much more favorable terms. For a neutral view of your current situation, experienced consultants are the best option. Experienced experts are often able to quickly identify relationships, problems and potential that you have not yet noticed.
The right strategy
When developing a new strategy, it is important to learn from past mistakes and use the knowledge to realign the company. It is worthwhile to invest enough time in the analysis and planning and to communicate transparently. An expert advisory team understands the current company figures and relates them to current performance. The analysis highlights why things are not going so well and where the problem areas are. Experience has shown that many mistakes are rooted in the management level. In this way, employees often do not get enough freedom, suffer from too much pressure or do not get the information they need for their daily work. In addition, an appreciative approach to employees as well as praise and constructive feedback are points that are often underestimated and have a negative impact on the work environment. If it is determined that there are problems in this area, professional management coaching can help to remedy the grievances. However, it is important here that further training measures such as management coaching are not only carried out once but at regular intervals and are part of a comprehensive corporate strategy.
Targeted innovation management
With targeted and forward-looking innovation management, companies secure competitive advantages that can form the cornerstone of future corporate success. The wheel does not always have to be reinvented. Rather, innovation management is about exploiting potential and establishing new and creative ideas and solutions. The creative idea is in the foreground, whereby the individual activities only lead to success in a coordinated manner. For example, tasks such as opening up new markets or introducing new products have to be coordinated. A comprehensive strategy that defines and organizes internal processes is the basic requirement for the successful introduction of innovation management.
Restructuring and downsizing
Restructuring is often essential for a company’s survival, although small crises can usually be managed without radical restructuring and without explicitly reducing staff. If you work on innovations early on and position your company correctly, you have a clear advantage here. Regular consulting and further training measures such as executive coaching can help to save the company from a crisis. However, if there is a situation in which there is little room for maneuver, efficiency programs and downsizing should not be taboos. Often, however, it is possible to cushion the excess of staff by means of normal staff reductions. In addition, employees can also be transferred to new areas of activity in the course of restructuring, so that the knowledge of these employees is not lost despite competitive pressure and financial bottlenecks.
Downsizing and rigorous restructuring should be considered as the last resort. Those who turn to experienced specialist consultants at an early stage and, together with the experts, provide important impulses, such as the establishment of innovation management or programs for management coaching, can use small and large crises as an opportunity to strengthen the company sustainably. With some commitment and the right partners, the company is quickly put back on track to success and, in the best case, it is also possible to secure undreamt-of competitive advantages that will put the company on a secure footing in the long term.