As predictions of another global economic storm ring out amid most of the world’s press, and stock markets tumble in fear, there are two things businesses should do to help protect themselves from what lies ahead. First, gather as much data about your business, Industry, markets, customers and competitors as you can and consider the appropriateness of your strategy. Second, invest in the right enabling technologies to track and interpret your data in support of your strategy.
In 2008, the world entered into a global financial crisis with most of the major markets spiraling to an unprecedented fall in value, culminating in massive falls by the end of Q1 2009. Some markets like the Dow Jones and the FTSE 100 have still only recovered to a value approximately equal to their pre-2008 peak. Many big names failed to survive during this time as investor and consumer confidence plummeted to all-time lows (The Guardian review of the financial crisis).
The reason for mentioning this is that a lot of the rhetoric surrounding the current economic status is derived from a vivid memory of these fairly recent events and is based on indicators such as interest rates, growth rates, government bond yields and fiscal debts that are still historically sub-normal as a legacy from actions triggered since 2008.
From the minute the chimes stopped ringing in 2016, the markets began a bear run. There are new fears of a global slowdown fueled by record low oil prices, over capacity in commodities, low growth in China, and negative interest rates in Europe and Japan, not to mention the fragility of world economies still reeling from the events 8 years earlier.
At the time of writing this (Feb 2016) world indexes have negative annual returns, with the US, European and Asia Pacific markets 15%–20% lower. (Bloomberg Market Indexes). Interest rates remain historically low, and inflation in some sectors is negative. Even the once-promising BRIC markets have collapsed with Brazil and Russia in recession, China in slowdown and only India propping up world growth figures. Goldman Sachs BRIC view. It is no wonder that the confidence to invest is low once again.
But all is not lost. What is needed now is a steady hand on the tiller. Savvy businesses are already considering their next move, with the best looking to build intelligence and improve efficiency to create an agile business that can maneuver sharply dependent on how, if, where and when the storm breaks.
This requires a robust vision, and a strategy that accommodates risk. But it also requires an understanding of up to date internal (micro) and external (macro) data, and how this data affects the delivery of goals and industry stakeholders.
What a business really needs is on-demand intelligence delivered to the right decision makers in the company, wherever and whenever they need it. In other words, to take advantage of digital transformation and use it to add value to their company.
Invest to save
Fortunately, help is at hand, there are technologies such as IFS EOI, IFS lobby and IOT that can support your business strategy, and allow reports, dashboard’s and graphical intelligence to be available to your desktop or mobile device instantly, driven by micro- and macro-data linked to your business goals.
Interest rates, GDP, growth rates, inflation, gold price, bond yields and currency rates (to name but a few) can all be mapped in real time against affected stakeholders and corporate goals, which in turn can be presented against operational performance KPIs to allow decision makers a full understanding of how the business is performing within the marketplace.
You do not have to invest in a full ERP solution to achieve this, as modular solutions are available to enable businesses to perform this integrated intelligence. In fact implementing modular solutions also carries less capital investment and less risk, which allows a faster and more assured return on investment.
Weather the storm
Whether or not a new economic and/or financial storm breaks, it makes a lot of business sense to invest in the right technology. Technology that can support the delivery of a robust business strategy, to inform about performance in a turbulent market. Add to this the support delivered by mobile integrated graphical information for operations, and the combined package is a full suite of intelligence for decision making to help weather the storm.
For more information on enabling technologies and to view this in the context of a business transformation structure, please read my previous blog or connect using the following;