Recession Proof Your Business

Presented by the

Dale Carnegie Business Group

Reality

• Canada is the most trade-dependent nation among the members of the G-7, with exports of goods and services accounting for 35 to 40 per cent of gross domestic product.

• Fully 80 per cent of the goods and more than 55 per cent of the services Canada exports are destined for the the U.S.

• In 2007, total trade between our countries topped $560 billion US.

• Canada is the leading export market for 36 U.S. states and ranks in the top three of 10 others. According to the U.S. Commercial Service, Canada is a larger market for U.S. goods than all 27 countries of the European Community combined.

• Roughly 70 per cent of goods imported and exported from and to Canada and the U.S. move by truck, so border issues affect the lives and jobs of million of Americans and Canadians.

• More than 300,000 people cross the border in both directions every day. Resolving cross-border gridlock should be high on the meeting agenda.

• Canada is the single largest energy supplier to the U.S., delivering about 2.5 million barrels of petroleum products a day, with Saudi Arabia running a distant second at 1.5 million barrels.

• Our electrical grids are integrated to facilitate power sales. Canadian uranium fuels U.S. nuclear power plants. Canada and the U.S. are each other's leading agricultural markets.

• At the end of 2007, the stock of U.S. foreign direct investment in Canada amounted to $289 billion, representing about 59 per cent of total foreign direct investment. Canadian investment in the U.S. totals about $160 billion.

• U.S. demand for Canada's goods and services has declined so dramatically that Canada has recorded its first trade deficit in 33 years.

• Canada's industrial capacity utilization rate – the ratio of what industry actually produces to what it could potentially produce – fell to 77.4 per cent in the third quarter of 2008, the latest period for which statistics are available. That's weaker than in the recession of the early 1990s, said Michael Gregory, senior economist at BMO Capital Markets, adding that the phenomenon "is very broad-based."

Major Concerns During Recession

• When will it end?

• How many should I lay off…any?

• How much should I cut…what should I cut?

• Should I invest? If I do and it doesn’t pay off what then?

Major Concerns During Recession

• Should I try to take market share from my competition? Why not?

• How do I keep people’s morale high? How do we improve our People’s Productivity?

• What if we lose everything?

Major Themes

1. Create a different, better offering – Take Market Share

2. Innovate – drive out costs, create new opportunities, sell dramatically more

3. Sell More, Sell Better

4. Get people’s morale and productivity up!

Step # 1 – Your Current Reality

• Threats

• Opportunities

• Trends

Market Market ShareMatch –

Offering to Market Wants

Competition

CapacityManagerial

Effectiveness

RegulatoryUnionLegal

Capital

Analysing Business Reality

Focus

• What areas should you focus on to:

Shore up your business?

Grow the business?

• Do you need to get into new markets?

• Can parts of your business go into new markets?

Step # 2: Customer’s Reality

• What is the reality of your customer’s world?

• Do an objective analysis (speculate first, then ask them yourself)

• What are their Threats? Opportunities?

Step # 3: Current Match

• Do they really want what you are offering?

• What do they really want?

• How have their ‘wants’ changed since the start of the recession?

• What is currently ‘out of sync’ with your offering?

Step # 4: Unexpected Offering

• What can you give them beyond what they think you can give them?

• What are their ‘emotional’ wants?

Sense of security, avoid lay-offs, keep margins high, same or more profit, feel confident moving through recession, market share

Step #5: Strategy to Deliver New Offering

• How can you get this renewed offering to them?

• How will you communicate this value to them?

• What operational things will need to change?

Step #6: Plan - Tactics

• Do you have a plan to deliver the new strategy?

• Do you have a contingency for each anticipated obstacle?

• Have you involved your team in the plan?

Step #7: Engaging the People

• Do your people see the whole picture?

• Do they see the consequences of not changing? The ‘personal’ impact?

• Do they see the opportunities?

• Do they know what is required of them?

• Do they know how they need to change?

• Have they developed the competencies required?