Check-Up Time for Corporates

The top managements that have a passion for sustainable success can set to work by checking up (Their Current Situation Analysis) in their business.

The COVID-19 pandemic continues to spread like blue murder nowadays and four month ago, such a pandemic of virus was not expected. However, by reason of that the financial outcomes of the economic crisis in 2008 have not rallied yet, an increasingly anxious wait dominated in the business world for several years now. During the crisis, which is lowered with monetary expansions, central banks transferred tens of moneys, and after the crisis, even though these moneys were estimating with negative interest, they were continuing to remain in the market.

Finally, this potential economic crisis, which is not put into words, broke out with a corona virus that occurred in China, not with a disruptive cyber-attack that can rout in partnerships estate. Our fear, ”the potential danger that we concern but not gone into cross action on it”, came true with its negative influences. Like an equation with two unknowns…

The 2008 crisis was fundamentally the financial sector crisis; The 2020 crisis, which is under the effect of the initiator and accelerator of the COVID -19 virus, happened as based a real sector. The crisis led to demand insufficiency that caused the tragic result with firstly supply chain-based problems and with spreading the pandemic. This situation leads to the financial crisis with real sector crisis. Thereby, the number of the unknown increased even more.

The world economy authorities pull out all the stops to weather this rocky road that we are in. The decisions that have been taken will be able to become more effective, when the pandemic come to a head- when the economic crisis come to a dead end-. And after this point, a return momentum will begin, even with huge and permanent scar.

Turkey, -when the macroeconomic indicators are taken as a basis- fall into the category of developing country. When we look at the nearly centenarian history of our country, normally, we see that it experiences an economic crisis septennial. Interestingly, the United States, which is the most economically developed country in the world, experiences this situation like us at about the same time. Even though this situation is seemed surprising, it proceeds from the market economy, which is applied around the world. So, systemic growth with ripple effect and then crisis… And again, systemic growth with ripple effect and then crisis…It seems that the structure has a repetitive and cyclical characteristic.

Crisis period should be followed in the market economy system. Firstly, the effects of internal and external problems, which were getting bigger and were papered over the cracks in terms of the 6-7 years continuous boomer should be fixed. The crisis intensity and the efficiency of measures taken; the impact level of the crisis reflect in social economic life.

In fact, crises are innocent, and they are definitely result, not cause; because they are delayed, ignored and not solved, they bring the grief. In addition, the crises come in useful because it pushes general economy and companies to make provision before the problem progresses. It has an impact on decision makers and provides to be made delayed decisions faster.

After such an introduction, we will speak of our agenda topic, ” the effect of all encountered crises on companies that are the main actors of economic life…

In order to be able to reach my suggestions in conclusion, I’ve grounded on ‘the top 500 companies‘ rankings that published over the years. I’ve analysed the reason of holding its own, of excluding from the list, of being at the top and of entering the list of companies, which are in the list of twenty years Capital 500, in the list of ISO 500 that has published for 25 years in Turkey and in the list of Fortune 500 that has published 64 years in the USA.

The result of this analysis clearly shows that; The reasons for being / not being in the list of 8 of every 10 companies that can enter the list are very loud and clear:

  • Out of list Companies: Companies in this category do not abide by first business model. They become indebted to above their development potential and try to follow the aggressive growth trend through acquisition. Later, some of them are involved in a bankruptcy in the first or new crisis or definitely are out of list by going downsizing with asset stripping.
  • The Companies that hold their own and are on the top: They are in full spate in their activity in all conditions, with high level performance of executive and with a business model that based on sustainable growth and determination, which is suitable for the economy and businesses. They also take advantage of the opportunities that occur in crises.  The acquisitions are turned to account at that.

Because of situations in their sectors, exclusiveness, no exclusiveness or creating of disruptive technology or its competition, two of the rest of 10 companies can enter or be out the list.

Consequently, when taking into consideration, the top managements that have a passion for sustainable success can set to work by checking up (Their Current Situation Analysis) in their business. With the reliable result obtained of these studies, a business model can be realized, which is suitable for potential and resource structures of managements, which inclusive the efficient and economical digital structure, which can provide the long-term sustainable growth & profitability. This new and renewed model will be the biggest supporter of executives in reaching strategic goals and will bring competitive advantage company activities.

Bülent Hasanefendioğlu