Managing Baseline Operations in the Face of an Economic Slowdown

Managing Baseline Operations in the Face of an Economic Slowdown

In the final quarter of Y2018 we witnessed a dramatic decline in global stock market prices for the first time since the crash of 2008. Fortunately, many of those losses have now been reversed following a bullish first quarter in Y2019. However, this has not stemmed the tide of negative voices who claim that an economic slowdown is imminently upon us.

Reasons cited for these fears include; geopolitical factors such as the recently publicized trade war between the US and China, high recorded levels of public debt, slowing growth in Europe led by Germany, fears over Brexit and a general air of unease with regards to consumer confidence.

While these fears may or may not be warranted as CPO’s and leaders in the field of procurement it is our responsibility to analyze the facts and take the necessary steps to mitigate and manage our exposure to any such outcome.

So, what should we do in the face of an economic slowdown? It is important to first understand the fundamental safeguards. The first rule in any economic downturn is that cash is king. Those firms with the greatest liquidity of assets are likely to face the best chances of survival. This is a good time to lease vs buy, contract vs hire and maintain a healthy operating balance on the books. It may also be a smart time to sell off idle assets and recognize the revenue ahead of a potential slide in valuation brought about by a slowdown.

Above all it is crucial that you have the best possible data at your fingerprints to manage those transitions with confidence, ensuring that the most efficient sourcing decisions are taken. Robobai’s AI powered procurement solution will give you that confidence. Our software offers up a complete picture of spend across the organization together with intelligent insights helping CPOs make powerful, strategic choices.


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