COVID-19 is forcing firms to make difficult spending decisions as they deploy their resources amid unprecedented market turmoil. Here’s how to get your spending strategy right.
Crisis management is about marshalling resources and deploying them quickly to where they will have the greatest impact. During the 2008 financial crisis, the firms which survived and later thrived were those that were quickest to achieve balance sheet flexibility.
Writing for McKinsey & Company, Ankur Agrawal, Stefon Burns, Kyle Hawke and Matt Jochim say the most successful companies “achieved three times the improvement in operating expenses as a percentage of revenues than their ‘non-resilient’ peers”. Here they explain how you can design a selling, general, and administrative expenses (SG&A) strategy for the COVID-19 era.