The World Bank estimates that the global economy is expected to shrink 5.2% this year, putting us in the midst of the deepest recession since WWII.
...and cutting costs can decrease your chances of surviving.
In a study of 4,700 companies following the last of three major recessions, companies who ruthlessly cut costs in a recession are the least likely to bounce back from economic downturns.
"While many will be fighting to keep the lights on, people who will thrive after COVID-19 has gone will use the time to change the bulb."
Paul Armstrong, Author ‘Disruptive Technologies’
But there is a way to thrive... a secret formula
Studies found companies that find a specific balance between investments in new initiatives and operational efficiencies are twice as likely to become market leaders following the recession.
Bonus: investments in 'green' and sustainable opportunties outperform!
Sustainability has become a key opportunity area to find this balance. Nearly 90% of research reports in this area show that sound sustainability and ESG standards lowered companies’ cost of capital and resulted in better operational performance.
Additionally, there’s a growing consumer expectation for eco-friendly and socially responsible brands, opening up new potential revenue streams to attract and retain loyal customers.