Saturday, December 6, 2008

Business opportunities in the (financial) crisis

Is there a crisis or not? Are we on the verge of recession or already in it? Are all these questions necessary? The fact is that business conditions in the marketplace have changed. The space and time we live in are challenging us to reflect on the validity of our working methods and our understanding of the markets in which we perform. To go deeper in understanding, it is necessary to assess our strengths and integration and to expedite our steps in the light of sustainable development.

More about the challenges (problems and opportunities) offered by the year 2008, and to which we will have to respond in 2009, you can read below. This is my view.

Vibacom: When can we start talking about a crisis situation?
VB: A crisis occurs when you get a significant imbalance between supply and demand of one or more fundamental foundations that are necessary for development: material (raw materials), financial, human, or social capital. Today, we can say that we were forced by a financial sector to operate with a lack of development-oriented financial and human capital, or, as the director of Adria Mobil, Sonja Gole, stated: "/.../ If you look at the crisis more broadly, you find, that the financial system has wholly failed" (Journal Dnevnik, 18.10.2008). The director of Trimo company, Tatjana Fink, "There is a lack of competent people, who act properly and with integrity in a time of crisis, who are able to think, decide and act quickly."

Vibacom: What are the characteristics of (economic) crisis?
VB: On one hand, these are: deteriorating balances in the market; the absence of one or more of the development capitals; a dramatic drop in orders in one or more steps of value chain, a drop in consumer confidence and loyalty (customer defection) and a gradual transfer of the crisis on the entire value chain, vertical and horizontal. There are also panic, fear, uncertainty, and layoffs present. On the other hand, a crisis simultaneously offers new opportunities.

Vibacom: Where can we find the new business opportunities in the times of crisis?
VB: History teaches us that in a crisis we can look for solutions in the redefinition of the market, in new business partnerships, in new definitions of the value chain, in inter-branch relations, in new technologies and consequently, in new products.

Vibacom: What are, in your opinion, the fundamental areas to be managed in times of crisis?
VB: Innovation, evolution, networking (business and social networks), people, communication and technological breakthroughs.

Vibacom: What should the behavior of a manager in a crisis be?
VB: The worst response is to react with panic. Managers should establish an atmosphere of peace and focus. It is also important to constantly keep a balance and ensure the development of both views: short and long term solutions, reaction and sustainability. Only when they support each other, an organisation can prosper in the long run.

Vibacom: What is the content of the short-term point of view?
VB: The first important step in this direction is open communication about the situation and the consequences of the crisis to the company (among management and employees). The second step is to clearly define objectives and responsibilities. The third step is a true engagement of all individuals in finding a path to these goals and in exploring new opportunities. In spite of the crises there has to be an atmosphere of openness and trust that creates a favorable environment for creativity and innovation. The fourth step is to ensure the swiftest decision-making process on the effectiveness of ideas and the implementation of the selected ones.

Vibacom: What about short-term substantive emphasis?
VB: Attention should be focused on the market, on relationships with customers and business partners, on relations with employees and on the consolidation of internal power. In short, on people.

Vibacom: And the long-term prospect?
VB: The first important area is to ensure smooth development of the factors that allow sustainable development: innovation, human capital, social networking, social responsibility. Another important area is to ensure a smaller geographical dependence - the distribution of geographical risk and to ensure a common interest in a search for new development directions (for example: 30% local involvement, 30% regional and 30% global, 10% daring individuals). The third area is the systematic development of selected customer targets, those who notice, appreciate and pay for our key competences. And the fourth area is a continuing integration of new technologies into our daily business. However, a successful dialogue between the institutions/stakeholders is the key for the success of short and long-term prospect.

Vibacom: Should the manager lay off workers?
VB: Each crisis is also an opportunity to make selections among employees. You should lay off those, who do not participate actively, whose integrity and values are not in line with those of the company, who are not a part of key competences of the company, those whose energies are directed elsewhere.

Estera Lah, Violeta Bulc (Source: Vibacom)

Vibacom: What have we learnt in this crisis?
VB: How strongly we are all connected and how vulnerable the global economy really is. How important it is to have a spread network - more we are connected, more information we can gather and the faster we can react. This crisis showed us as well, how important is cross-branching - to keep information flow going not only vertically but also horizontally. How important it is to be really closely connected with your key suppliers and clients, which help to compensate for extreme fluctuations with a bonding based solutions. And finally, we have learnt (I hope) that economical and social freedom in the hands of irresponsible and immoral people, is a threat to all mankind. In other words, we have to invest a great deal more into the development of emotional, spiritual and social dimensions of people, not only into intellectual and physical (material and financial) to help globalization to really florish.

Vibacom: What challenges in the times of crisis do consultants face?
VB: To try to understand our clients and be a true partner at the right level, at the right time with enough different aspects that lead to (innovative) breakthroughs and right solutions. We also need to be well developed on all levels of human capital: physical, intellectual, emotional, spiritual and social.

Vibacom: So, where do we go from here?
VB: Please be interested in communication. Speak up, care, dare, act. Maybe you can start by writing your comments to my thoughts and we can together make a new step towards higher consciousness.

Vibacom: And the final thought?
VB: It is necessary to integrate, to cooperate more than ever before. Not only among economists themselves, but also all other social structures: political, social, artistic, scientific, media. Everyone counts. Strong inter-generational links are also necessary. Wisdom should meet with youthful boldness, best case practices balanced with the impossible. Strength is in networking. The more we are connected, the more we are free, the more strength we are able to collect, the more we calmly react. Anyone who knows, should teach and share, and be aware that his/her breakthrough is a result of collective consciousness in the space and time and therefore is part of the common good.

Vibacom: Thanks!

Reblog this post [with Zemanta]

5 comments:

P.Ryan said...

Your last paragraph, is very profound, in that it allows a new lateral thinking into approach to business, which is by its nature, "profit focussed", at the cost of human value. Spirituality, art, intellectual thinking,and the desire to dare, are all ingredients in a new paradigm for progress. Good luck.
P.Ryan.

Tom Best said...

I wonder how much of an influence high commodities had on this economic crisis?

Violeta said...

I wonder myself... I think that is is a combination of simply wanting and having too much along with value set crisis ... how much is enough... where human race go wrong that on top potions there is so few humans... we need to put all our efforts into youngsters and teach them how to think with their own head-

Business Opportunities said...

Good informative and useful article in the recession period.

ptrpham61 said...

nice article thanks for sharing.CafeF