Organizations-Playing Offense or Defense
Organizations in today’s economic times are either playing offense or defense, whether they know it or not. What determines which style of play? Cash or operating capital availability. With the credit markets shrinking, cash on hand has become a significant criteria for survival and the opportunity for growth. Those organizations that have lived from month-to-month off their line of credit are now in trouble. Those lines of credit are being reduced or foreclosed on due to a lack of payment. Organizations that have kept their on hand cash balances in proportion to their debt have a chance to survive the current slumping economy. The organization that maintained a healthy cash position now have a chance to take advantage of that strategy and take advantage of great bargains on asset purchases, merger/acquisitions with competitors, product development, etc. Everything is discounted, and if you have the cash you can make short term deals that will multiply in the long run and make your organization more successful.