(Source: The Jordan Times)
By Jordan Times, Amman
Sep. 7--AMMAN -- Despite current pressures, entrepreneurs are focusing on the positives and looking for strategic growth, according to the findings of a recent study conducted by Ernst and Young.
The study, titled, "Seizing Opportunities: Redefining Growth in a Turbulent Economy" was carried out to demonstrate the aggressive and acquisitions oriented approach of entrepreneurial companies to the economic downturn, according to a press statement received by The Jordan Times.
Conducted among 3,100 finalists of Ernst & Young's Entrepreneur of the Year programme from around the world, the survey revealed that 67 per cent of the world's best entrepreneurs were pursuing new market opportunities while their second priority was to improve performance.
Findings confirm that despite pressures, 40 per cent of surveyed entrepreneurs have not increased focus on cash generation from operations, and reshaping their business is not a high priority. This indicates that they have sufficient cash reserves or can access alternate sources of cash to approach opportunities.
Michael Hasbani, from Ernst & Young Middle East, said: "The survey revealed that, in order to withstand the downturn, entrepreneurs are optimising activity in six areas -- customer, transactions, people, operations, finance and risk. They realise that some customers will fall away during tough times and 80 per cent are increasing focus on re-negotiating contracts and managing customer bankruptcy. Their approach to transactions is to cautiously raise capital, renew their focus on seeking mergers and acquisitions and divest non-core assets to realise capital. Seen from another perspective, the downturn has opened up space in all local and global markets. Companies that cannot adapt to the new circumstances will be replaced by exceptional enterprises that are better able to adjust to new realities."
Adapting to new realities has driven entrepreneurs to bring in changes such as rewarding key people, in particular, increasing productivity through reduced costs and decreasing investments in capital projects.
Although there is a split over whether to increase or decrease exposure to risk, the majority of surveyed entrepreneurs have retained their encouragement and reward of measured risk-taking. A total of 92 per cent have confirmed that they are creating early warning systems for financial distress.
"The overall findings reveal a greatly changed global business landscape. This is a critical phase in any business cycle, where the recipe for success is to think different and act bold. Entrepreneurship is a great force for economic and social change. Entrepreneurs embody the potential that exists in all economies and societies. There are few golden moments in history like this one to seize opportunity and truly make a difference," Hasbani, who is head of strategic growth markets, added.
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