Opportunities in the current climate
The current turbulent economic climate has created extraordinary opportunities for
business failure and success. Many businesses will not survive, others will be permanently disabled, but others will take
advantage of this crisis and advance their operations to a higher level.
The winners and the losers will be
separated by those willing to assess their current situation and be outward looking, to make the changes necessary early enough
to adapt to the changes in the market place and to continue to be innovative.
Many well known names from football clubs to car manufacturers and coffee shops to TV broadcasters have all been
hurt by these challenging times, exposing the depth and severity of the current recession.
The question is how has this affected the Asian business sector if at all?
Many Asian businesses operate primarily on a cash basis and as a result don’t really experience the tightening
of cash through working capital movements. Nevertheless falling sales, rising overheads and the consistency of supply will
have an effect on these businesses. Making the right decisions at the right times will be crucial for their survival.
Building a successful
organisation is no easy task. A number of key factors must be in place and then regularly revised and updated. With the countless
distractions and difficulties that are faced by many organisations in this climate, it is vital to maintain focus on these
There must be a clear and solid management
structure with goals embedded in a strong mission statement. These values should be able to be transferred to each and every
stakeholder within the organisation, and more so in these tough times. Clarity of purpose and direction needs to be demonstrated
by the management in order to maintain the confidence in the organisation.
The smooth running of the internal organisation
is paramount. This is only achieved by having the right people in the right positions. Without this there is a constant drain
on management resource in non business critical tasks. Having the right people will ensure the organisation maintains its
focus on the objectives.
· Management need to constantly be able to look forward to the future in anticipating
consumers' needs. They must employ all the cutting edge techniques to deliver what the consumer wants and when. It’s
all too easy to start inward looking and loose track of satisfying the consumers’ needs.
There needs to be strong financial management
at all times. Up to date information of the performance of the business and its financial resources will support the correct
strategic decision making. In good times, many organisations become complacent and relax their attention on the financial
performance of the business.
Having said that, there will still be situations where more radical measures need to be taken. An understanding of
the options available will help organisations select the most appropriate route to recovery of their business.
At the first signs of difficulties, seek professional advice from an accountant who has experience of dealing with
recovery and turnaround situations. It could be that the problems are only at their very earliest stage and with a measured
amount of restructuring and close financial management the company can be steered into clear waters.
It could be that the company is in need of some short term funding to relieve it of some cashflow pressures. Working
with lenders at the earliest possible times can ensure that the funds can be raised and put to the most effective use. The
longer the time period the greater the cashflow hole is likely to become, thus eroding equity and making it more difficult
to raise the required funding.
But in some cases it may be that the
company is so deep in distress that the only solution is some form of insolvency. This can have many different forms but again
the earlier it is dealt with the better the resulting solution that can be found.
For many Asian businesses these situations and the processes involved in dealing with them are quite alien. However,
there are a growing number of them that are discovering the wider options available to them. Turning to the professional who
have the experience in these fields are helping many to overcome their difficulties.
It can be argued that a major contributory factor to this is the number of Asian professionals who are taking up
positions in these sectors and breaking down the barriers behind understanding these options.
Their professionalism coupled with an in-depth understanding of the cultural nuances affecting the Asian business
market is helping many businesses through some very difficult times.
The current recession does not distinguish between Asian and non-Asian businesses. All are being affected by the
downturn in some way or other. Some are taking this climate and making it a time of great opportunity, but there are a great
deal who are not averse to acting promptly. For them this time could well signal the end of their organisations. But this
needn’t be the case.
show that businesses becoming insolvent are worse now than the previous recessions of the 70’s and the 80’s. But
what can be done? Unfortunately for some businesses, it can seem that there are no ways around their financial problems.
In reality there are now a number of ways to try and save your business.