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CORPORATE RESPONSE TO THE CRISIS
sINCE the financial crisis first struck in late 2008 , most corporate entities have cut costs to increase efficiency and reduce waste . For the most part , this has helped them to survive the worst of the crisis and strengthened their balance sheets . But although cost cutting will remain important , the risk of undermining performance through efficiency drives has grown now that the easy options have already been taken . Among the survey ’ s respondents , 61 % say that the risks associated with cost cutting have increased .
A common problem is that , when faced with a crisis , companies cut costs across the board without considering how this will impact their ability to compete effectively . Companies may find that , having reduced headcount to achieve cost-cutting targets , they subsequently have to rehire in to manage an increasing workload or capitalize on a new business opportunity .
Growth opportunities driven by innovation
The growth agenda has become more complex and challenging , but this does not mean that there are no opportunities available . In particular , innovation continues to be seen as important . Almost 60 % think that the opportunities for innovation in products , services and operations have increased as a result of economic turbulence . History has shown that some of the best product and service innovations emerge during times of economic difficulty .
Clean technology attracting attention
One specific sector that is attracting significant attention , despite the downturn , is clean technology . Among a recent survey ’ s respondents , 55 % think that the opportunities here have increased . A combination of high oil prices , changing consumer sentiment and government regulation or tax breaks has helped to create a fertile environment for investment in clean technology .
In 2011 , global investment in clean technology hit a record high of US $ 260 billion , an increase of 5 % compared with the previous year . But despite the enthusiasm for clean technology , this remains an industry in its infancy , where shake-ups and disruptive new entrants remain frequent .