4 critical skills for businesses to thrive in a recession

Peter Grist, the managing director of Australian corporate coaching and training business, GRIST, revealed firms are already beginning to review budgets in preparation for a forecasted global downturn.

“With the Australian economy cooling, businesses need to act quickly to prepare and galvanise their operations,” the expert said.

Highlighting economists who are forecasting a “long and deep” similar period of recession in current times, Mr Grist stated that “not only are we facing a period of uncertainty, we are also facing a period of great change” which requires “a different state of mind and range of skills”.

“The skills required in a bull market are different to those in a bear market. These are not skills that come naturally; they need to be taught in a way that corresponds and aligns with the operations of the business,” he explained.

He emphasised that during the Global Financial Crisis (GFC), business leaders gained firsthand experience in weathering economic storms and surviving recessions, noting that those who successfully made it through the downturn recognised that the key to survival lies in one essential element: their people.

"You have to have the right people with the right attitude and skill set to position your business to weather the storm,” Mr Grist said.

He strongly advised businesses to “galvanise your people and your business with the skills needed to survive and thrive over the next few years”.

“Managers and leaders in particular need to understand this and develop their capabilities to be able to navigate the period ahead and ensure they are able to guide and support their people accordingly,” he said.

On that note, Mr Grist outlines the four skills businesses need to weather an economic downturn:

1. Adaptability and the capacity to work in a universal way

The expert recommended businesses adopt a “universal and survival” approach to doing business.

“Skill up your people to learn a broader range of skills that enable them to job share, fill in and assist in other roles where and when needed,” Mr Grist said.

To achieve this, the expert advised incorporating a broader set of responsibilities into roles so that there is less segmentation of work.

“Role segmentation is a luxury in a tighter market. Essentially, people must be able to jump in and out of roles and work activities as needed to reduce idle capacity and increase efficiency,” he explained.

2. Resourcefulness and cost-effective strategies

Mr Grist emphasised the importance of identifying and implementing efficient strategies, particularly during economically challenging times.

“People must be trained in skills that enable them to think more creatively about how to bootstrap and achieve efficiencies in the business,” he said.

He also highlighted the need to coach managers and leaders in supporting individuals to change their behaviours and discover alternative, cost-effective approaches that not only achieve desired outcomes but also amplify results.

3. Digital literacy

Noting that technology is “evolving at a faster pace than ever before”, the expert underlined that businesses need to ensure that they are embracing this change wherever possible to improve productivity and eliminate slow, time-consuming and expensive ways of operating.

For starters, he recommended leveraging the use of AI-powered systems to boost productivity.

“The key is to embrace technology in a way that enables simple and repetitive work to be undertaken by AI so that resources can be freed up to focus on higher value and revenue-generating work,” he stated.

Additionally, Mr Grist said people who are experts in the use of AI will become increasingly valuable for the business as “they seek to find ways of providing customer service and other important activities in more cost-effective ways.”

4. Social skills

Lastly, Mr Grist advised businesses to bolster their social skills, including collaboration, leadership, influence, and communication.

He explained tougher economic conditions place more pressure on businesses and their workforces to achieve productivity gains and sales outcomes.

“Businesses need people with the skills and capabilities to ensure the business is performing well while also maintaining high levels of morale.

“This can only be achieved when people have the right social skills and are being coached and supported through effective leadership. Statistically, happy and engaged workplaces are more productive.”

Mr Grist called on businesses to “urgently focus” on coaching their managers and leaders at all levels to prepare them for the period ahead.

“Businesses need to prepare their people to develop the skills and behaviours needed to support the business to succeed during periods of financial pressure and economic uncertainty.”

The expert cited research that showed that in an era of rapid change, cultivating a mindset of continuous learning and adaptability becomes a “great differentiator”.

“The ability to learn and adapt quickly to new situations enables individuals and organisations to stay ahead of the curve and respond to changing circumstances with agility and resilience,” Mr Grist said.