To survive this downturn, CEOs need to reduce spending while continuing to invest in the organization’s long-term strategy
Cambridge, MA, January 26, 2023–(BUSINESS WIRE)–The current global recession will be different from any previous recession, according to the Forrester (NASDAQ: FORR) study “Responding to a Recession in 2023.” way to expand. While previous recessions have followed boom-bust cycles, the 2023 recession comes on the heels of a pandemic that has disrupted business models and forced organizations to adjust their business strategies. Additionally, multiple factors contributed to the complexity of this downturn, including inflation, energy costs, supply chain challenges, regional conflicts, and changing worker demographics. These factors uniquely combine across regions and industries, ensuring that each country will have a different experience.
New Forrester research offers proactive measures to help business leaders in technology, marketing, sales, customer experience, digital, security, and risk navigate this downturn effectively. Specific guidance for CEOs includes:
Focus on long-term strategy with smart cuts and smart investments. In the face of previous recessions, many leaders implemented sweeping cuts. However, this brute force approach can do more harm than good. Many leaders also believe that if they cut spending, they won’t be able to make new investments, but in reality, CEOs are ripe for doing so. In addition to establishing a customer-centric goal and then making smart cuts based on that goal, leaders should move forward by investing in technology that improves customer experience, employee experience, and productivity, even if others choose to stand still.
Put talent at the center of your long-term strategy. Currently, 54% of US workers and 43% of UK and French workers believe their organizations make personnel decisions in a prudent and people-centred manner. When considering layoffs, CEOs should identify the individual contributions and skills that will position their company for the future and invest in a talent intelligence program that thoroughly tracks employee skills and performance capabilities.
Choose the right customers to attract them. In a downturn, CEOs must realize that deciding which customers not to serve is as important as who to serve now and in the future. Ultimately, underperforming markets lead to underutilized operations, overlooked technical debt, and wasted valuable resources that could have been aligned with better opportunities.
“This recession is unlike any other that businesses have experienced to date,” said Sharyn Leaver, chief research officer at Forrester. “As a result, business leaders can’t rely on what worked before. They need to think differently and adjust their Products, processes, and customer experience. This research is designed to help business leaders make informed, growth-conscious choices to support their organization’s long-term strategy.”
Forrester (NASDAQ: FORR) is one of the world’s most influential research and consulting firms. We help leaders in technology, customer experience, digital, marketing, sales, and product functions leverage customer obsession to accelerate growth. Through Forrester’s proprietary research, consulting, and events, leaders from around the world are empowering their work to embrace change and put clients at the center of leadership, strategy, and operations. Our unique insights are based on annual surveys of more than 700,000 consumers, business leaders and technology leaders around the world; rigorous and objective research methodology, including Forrester Wave™ assessments; 100 million real-time feedback polls; and the collective wisdom of our clients. To learn more, visit Forrester.com.
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