I want to write down a few of my current thoughts on how in my opinion ICT firms should react to the situation. Unlike the famous US venture capital firm Sequoia, who invited their portfolio firms’ management in to give a presentation that basically said “put the brakes on and think 2-3 years out”, I think there are better ways to deal with it.
My thoughts assume that you have been able to use the last few years to accumulate cash and can deal with this for some time and are not living from hand to mouth, as you otherwise would have more pressing issues regardless of how the markets look like right now.
In healthy times everybody tries to grow within a certain framework that is given by key resources (budget and people). During these times you compete with everybody trying to maximize the return on sales & marketing spending.
Now when a lot of other companies start to put the brakes on you have a unique chance to stick your head out by simply not cutting down on sales & marketing, as you will get more traction than ever before. Historically, during recessions, very successful companies who think this way have taken the opportunity to build market share while their competitors are only thinking about survival.
As mentioned above, life will go on and there will be times ahead when the financial mess is no longer on the cover pages. If you have kept sales & marketing going up until then, you will without doubt be in a better position when the market rebounds than others who slowed things down. Clients are built over long periods in B2B business. Keeping in contact with them even if they might be ordering little or nothing gives you lasting credibility. Nothing is hated more about sales & marketing than opportunistic short-term thinking – something that btw brought us into this mess in the first place – but that is a different subject that will be taken care of I think now too.
Perception is key, as we see also in the stock market yo-yo game right now. If you give the perception that things are going on as usual by keeping your company’s client interface unchanged then you will give the best possible impression.
If cuts are inevitable then don’t make them where they are most visible to your clients, which is your sales & marketing department. It’s found over and over again that big multinationals in particular that are quick to cut down on sales & marketing, and equally in customer support, keep going down the death spiral.
Now I am of course biased, you might comment quite correctly. Still there will be a few companies that will follow my advice and enjoy a better position than ever before in only a few years from now! A market research we found too on this topic.