The background of this article are two French firms in trouble, with around one hundred employees and twenty million in revenue each, hiring an Interim Manager. These two manufacturers of industrial equipment are subsidiaries of two international Groups of about 1,000 employees and € 200 million in revenue. Each local company suddenly loses his top manager, for different reasons, but that lead the Groups in both cases to assign an Executive Interim Manager. This aims to take control of the French subsidiary to drive organizational change and allow time to set up a sustainable solution for the management of the company.

This is not a fiction, both cases were experienced by the same Interim Manager 1 year apart

In parallel to the operational takeover of his organization, the Interim Manager begins each assignment with an “integral audit”(1) of the company per four dimensions: functional, operational, communication and value system. Regarding the functional dimension, he analyzes the quality system, procedures, rules, flows, … At the operational level, he evaluates each key person, implementation and impacts of processes, and staff involvement. He also analyzes the quality of communication between people. Finally, using Spiral Dynamics method, he studies the culture of the organization and its environment and ways of thinking and behaving of key people.

He concludes from these detailed analyzes that the two organizations, at the Group level as at the French entity level, have in common a pyramidal organization, dominated by a traditional and autocratic management style, sometimes even repressive. Search for optimization of financial profit and cash management takes over social considerations. The competitive environment is very harsh and exacerbated by several large accounts very demanding in terms of price, quality and reliability of delivery.

Based on these diagnosis, in both cases, the Interim Manager establishes an action plan to reorganize the local company

The difference in freedom of action of the Interim Manager between the two situations is accentuated by the contrast between the levels of independence of the two subsidiaries

Obviously, the impact of these differences is visible in the results of the two assignments

The chemistry necessary for the success of an Interim Management assignment is complex

Among its ingredients, such as for a conventional Manager or an employee, the degree of autonomy and freedom of action given to the Interim Manager are key success factors.

(1) : The “Integral Diagnosis” is part of the tool box to optimize organizations entitled “Management 21”, used by the Executive Interim Manager who performed these two jobs. Management 21 consists of 5 steps: Needs, Integral Diagnosis, Choice, Change and Perpetuation. Some of the “tools” used by Management 21 : The Work, Process Communication, Lean Management, Appreciative Inquiry, Spiral Dynamics, …

(2) : PSE = Redundancy and restructuring plan according to the French law

Why is strategic brand management even more relevant during an economic downturn?

Brand management is bound to get rather complex during economic downturn and recessionary phases. This is because of the sensitivities created by the competitive landscape and market dynamics that tend to create price war and sometimes even result in cut throat competition amongst players. This is a situation that will render customers in a phase of introspection and critical evaluation of value for money spent before making purchase decisions. Consumer behaviour therefore becomes unpredictable.

From a business perspective, brands have two options in such situations. They can either be reactive and become victims of the situation by imposing cuts or ban on branding budgets. This will be the worst reaction because by doing so, they are only driving themselves away from people’s minds at a crucial and opportune time. On the other hand, brands can be proactive and use situations as a great opportunity to their advantage. Thereby they don’t just preserve, but enhance the brand reach, for example look at log cabins for sale from Parklink with their new brand management campaign.

Why is it so critical to stay invested in brand management during recessionary trends and downturns!

• Products tend to become commodities as functionality replaces blind faith in brands.
• Customers tend to become more price sensitive and less brand conscious, due to tightening of wallets.
• Search engines become choice engines, so to say. This is true more so of a B2B segment, where there are multiple purchase points across a value chain.

Here are some of the things that businesses can do right under such situations

• Clearly not fall into the trap of price war but sustain prices in a range and stay distinct as a niche player.
• Strengthen perceptions on professional pricing through strategic brand management and positioning.
• Use business process re-engineering and lean management concepts to achieve a backward integration of margins across all elements in value chain. This will help to make product offering more competitive for themselves and for customers.
• This is also a great opportunity to research consumer insights more deeply and gather reliable and useful information about which brands or products in the market are resilient and possess sustainable value These findings can then be effectively used in the ongoing brand strategy to achieve clear Customer Value proposition.

These are only some of the effective strategies that brands can adopt to use the recessionary phase to their advantage. But none of these would be possible if branding spends do not find a place in the budget which is even more crucial during these phases. Branding budgets are absolutely essential even just to stay afloat and retain market share, let along increase market share and margins.

Businesses that can visualize the long-term benefits of staying invested in brand management during these difficult situations would clearly foresee the benefits that would accrue in medium and long term. Brands that are successful in creating a lasting and consumer driven experience during difficult times would reap benefits of that investment through viral marketing that would be generated in future, merely by word of mouth. It is important to remember that cost of regaining lost customers is always a huge multiple of cost of maintaining them.

About the Author: Asha Sampath is Founder and Head of Growth and Brand Strategy Practice at Brandhorizon, a leading Digital Branding Solutions Company in India. She leverages over twenty years of rich experience and skills in General Management, Branding/Marketing and Finance Management. She integrates her in-depth knowledge and functional expertise in international businesses, in tailoring Brandhorizon and its services to help transform businesses using innovation needed in today’s dynamic and fast paced global marketplace. Her diverse experience to run businesses, both in India and abroad, includes General Management for Greenfield projects and financial positions with Price Waterhouse, Kirloskar Electric and Carrier Transicold (Part of United Technologies, IncUSA).

#Brandhorizon is an International Brand and Marketing Consultancy firm that offers Strategic Brand Consultancy and helps you to effectively utilize your limited budgets to strengthen your brands strategically, using Consumer Insights and Customer Experience Journey.