How funny we keep seeing this cycle of ups and downs…In an up we believe there will be no downs…and in a down we believe there will be no up!
I thinking cycling and running – two things that I do help you handle such situations well! If it is a route you know (or you are learning) you realise that an up is followed by a down…and so in life, markets and economics!
It is also easy to understand – in a boom you can increase prices to whatever levels you want, nobody complains. So you increase costs, reduce discipline….etc. then the recession sets in. There is a slow down – again easy to understand the raw material supplier knows he can sell to 4 other manufacturers, so he does not care, he keeps increasing prices…
When there is a recession and there is a need to reduce costs, there is too much pressure on Managing Directors to do something.
In fact what he does NEED NOT HAVE ANY GREAT IMPACT ON THE P&L, BUT IT SHOULD LOOK GOOD. So these are the things they do:
1. Once upon a time they would say…mobile bill will not be paid…(now I guess this would be stupid).
2. No paper cups in the canteen – people should bring their own ceramic cups.
3. Travel should only be by Y class.
4. No more fresh recruitments
5. As far as possible meetings should be done on phone / video phone…and travel should be reduced.
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