How to hold your ground during recession

First, there was Covid – a pandora’s box of the pestilence that snowballed in early 2020 and brought the world economies to a standstill. It took two good years and a few vaccine shots to get the world out of the clutches of this nemesis. While the world is still making a comeback, we have the Ukraine war which looms like a morbid cloud over the world, predicting an imminent recession.

What does the recession spell for the corporate world?

Adverse business impact – High interest rates increase costs to conduct business, which mandates reduced overall spend. Higher cost of material and labour adds further to the challenge.?

Mitigation- Pre-emptive and planned redeployment of the existing talent with upskilling initiatives wherever needed. Create a list of priority job roles and build a skill repository for existing talent to see how they can be mapped effectively to these priority roles. Increasing productivity is key to offset higher costs of material and labour.

Cybersecurity threats- The ongoing war has cascading repercussions on information ecosystems within organizations and can adversely affect critical business processes rendering them vulnerable to cyber threats.

Mitigation- Establishing robust governance protocols, regular updates of asset inventory, instilling crisis management processes in place, relying on the government intelligence machinery, and tailoring your processes as per their updates.

Labor risks- Unskilled or un-trainable labour may be perceived as a burden and potentially lay-off candidates.

Mitigation- Extend affirmative action to factor in the changed equations of talent availability. Hybrid and flexible working policies and welcoming cultural diversity into operations will help ameliorate the problem.

How should employees prepare for the recession?

Augment your contingent fund- Save for the rainy day. Keep adding to your contingent fund and keep it strong, so in case of the worst-case scenario, it gives you a buffer while you evaluate your options to get back on track.

Cut down on your debts- pre-close your liabilities while you can. Make sure you factor any remaining debts into your backup plans to make more realistic provisioning.

Reskill your way to survival- Give serious consideration to cross-train and multi-task as a continuous value add during the recession. Make an inventory of critical job roles that won’t see the ax in the worst of situations and work up your way to skill yourself in one of those departments.

Spruce up your financial literacy- Make your money work for you in situations where you are unable to work for money. Get agile on the financial learning curve and invest and hedge your funds wisely for better returns.

Prepare a no-frills mindset- Organizations may strip some of the frills or slash some percentage of remuneration to stay viable. Be prepared to cut corners accordingly. Adapt to a no-frills mindset to stay put till the worst is put behind.

The new mantra is- when the times get tough, the tough get flexible, resilient, and humble; flexible to learning new skills and tools, resilient towards taking better control of your financial prudence, and the humility to survive when it is not possible to thrive. ?

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