# How to Make Your Company ‘Recession-Proof’  Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-06-29 Category: TECHNOLOGY Category URL: https://financedigest.com/category/technology Meta Title: Facing a Tech Recession: How to Keep Your Business Afloat Meta Description: Learn how to navigate the challenging economic landscape of a recession as a tech company. Discover key strategies for success in challenging times. URL: https://financedigest.com/how-to-make-your-company-recession-proofhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/istock-1315756613-1736815614196-compressed.jpg) ![](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/adam-fard-450x485-1736815614210-compressed.jpg) _By_ **_Adam Fard,_** _CEO and founder of AdamFard UX Studio_ 2022 has been a difficult year for tech companies, with tech stocks plummeting and leaving staple tech giants such as Apple, Meta and Google losing more than $2.7 trillion. This has resulted in other companies such as Netflix and Cameo laying off [high percentages of their tech professionals.](https://news.crunchbase.com/startups/tech-layoffs-2022/) Let’s take a closer look at what exactly it means to face a [recession and how you can keep your business](https://www.financedigest.com/german-businesses-expect-only-mild-recession-as-disruptions-ease.html "German businesses expect only mild recession as disruptions ease") afloat during one. _What Is a Recession?_ Investopedia states a [recession is a ‘macroeconomic term that refers to a significant decline](https://www.financedigest.com/decline-in-german-services-sector-eases-raising-hopes-for-milder-recession-pmi.html "Decline in German services sector eases, raising hopes for milder recession -PMI") in general economic activity in a designated region. It had been typically recognized as two consecutive [quarters](https://www.investopedia.com/terms/q/quarter.asp) of economic decline, as reflected by [GDP](https://www.investopedia.com/terms/g/gdp.asp) in conjunction with monthly indicators such as a rise in unemployment.’ This definition is exactly what’s being faced in the current [economic market](https://www.financedigest.com/economic-growth-risks-jolt-inflation-obsessed-markets.html "Economic growth risks jolt inflation-obsessed markets"), which is drawing many comparisons to the ‘dot com crash’ of 2000. One of the more commonly cited reasons for this is the growing prioritisation of [growth itself in the tech](https://www.financedigest.com/starbucks-projects-profit-growth-from-tech-stores-workers-spending.html "Starbucks projects profit growth from tech, stores, workers spending") sector, rather than profits. _Is a Recession a Death Sentence?_ The good news – no, it’s not. It might appear that entering the economic landscape during a recession is a blatantly bad idea, but a multitude of large [technology companies](https://www.financedigest.com/5-top-tips-on-how-to-grow-a-technology-company.html "5 Top Tips on how to grow a technology company") – Square, Asana, Slack, Zoom, Air BnB and Groupon – have done just that and emerged not only unscathed but successful. This is because a recession _does_ [present opportunities](https://www.financedigest.com/why-sustainability-presents-one-of-the-greatest-opportunities-for-the-financial-services-industry.html "Why sustainability presents one of the greatest opportunities for the Financial Services industry") that can be taken advantage of. These include: - Fewer competitors - Required efficiency and competency - Highly qualified talent looking for jobs - [Customers and users](https://www.financedigest.com/rabobank-to-monitor-the-real-time-experience-of-every-customer-and-user-for-all-services.html "Rabobank to monitor the real-time experience of every customer and user for all services") seeking better, new alternatives This isn’t to [say that there won’t be potential](https://www.financedigest.com/virgin-orbit-says-space-startup-in-talks-with-potential-investors.html "Virgin Orbit says space startup in talks with potential investors") struggles or difficulties, but it does highlight that there are clear prospects amid a recession that you can work with to create your own success. _How to Become Recession-Proof_ There are a few crucial steps to make your [tech company](https://www.financedigest.com/uk-to-fine-tech-companies-that-fail-to-remove-self-harm-material.html "UK to fine tech companies that fail to remove self-harm material") recession-proof. Outsource to Experts A recession typically leads to needing to [cut costs](https://www.financedigest.com/gms-cruise-to-focus-on-cost-cuts-as-it-ramps-up-robotaxis.html "GM’s Cruise to focus on cost cuts as it ramps up robotaxis"), which usually causes layoffs and a severe shortage of talent and workforce as a result. Outsourcing your needs can be one of the best ways to [save money](https://www.financedigest.com/how-to-save-money-for-a-car.html "How to save money for a car") and achieve a better return on investment. By outsourcing, you can [manage capital with more flexibility as you can measure and reallocate resources](https://www.financedigest.com/uk-to-manage-water-resources-carefully-as-drought-continues.html "UK to manage water resources carefully as drought continues") as you need to, without being bound. You also have much more control of your personnel, and you won’t be faced with [needing to go through time-consuming and emotionally charged](https://www.financedigest.com/why-ev-charging-stations-need-to-accept-open-cashless-payments.html "Why EV Charging Stations Need to Accept Open Cashless Payments ") layoffs to rearrange or reallocate your resources. R&D [Product Innovation](https://www.financedigest.com/product-innovations-and-advancements-in-technology-to-boost-automotive-ignition-system-market-growth.html "Product Innovations and Advancements in Technology to Boost Automotive Ignition System Market Growth") Although operating within a [recession can feel](https://www.financedigest.com/consumer-durables-sector-still-feeling-the-effects-of-recession.html "Consumer durables sector still feeling the effects of recession") very overwhelming, try to stick to the facts – tech is not going anywhere and the demand for this type of product and service will rise again. [Investing in R&D, specifically into solid UX, is absolutely critical at this time](https://www.financedigest.com/samsung-elec-breaks-ground-on-new-chip-rd-centre-plans-15-billion-investment-by-2028.html "Samsung Elec breaks ground on new chip R&D centre, plans billion investment by 2028"). By advancing in R&D, you can make your product or service much more [attractive to future investors](https://www.financedigest.com/5-ways-that-start-ups-can-attract-investors.html "5 Ways That Start-Ups Can Attract Investors") while also retaining a current user base and beginning to appeal to new ones. UX research can help you to spot the opportunities that may have otherwise been overlooked, continue building on what’s [important for your business](https://www.financedigest.com/software-to-display-your-businesss-important-information.html "Software to Display Your Business’s Important Information"), and support and inform your product roadmap. You’ll find that UX research really enhances customer-driven decisions and helps to keep that as your [main priority](https://www.financedigest.com/employee-wellbeing-main-priority-for-uk-banks-as-they-seek-to-attract-quality-talent.html "Employee wellbeing main priority for UK banks as they seek to attract quality talent") instead of becoming obsessive over features. [Reduce Costs](https://www.financedigest.com/home-start-lincolnshire-implements-flexible-unified-communications-service-to-reduce-costs.html "HOME-START LINCOLNSHIRE IMPLEMENTS FLEXIBLE UNIFIED COMMUNICATIONS SERVICE TO REDUCE COSTS") Through Better Product Experience [Product spending can be divided into key](https://www.financedigest.com/chondroitin-market-overview-analysis-by-top-players-product-segments-market-size-and-leading-key-players-2022-2029.html "Chondroitin Market Overview & Analysis by Top Players, Product Segments, Market Size and Leading Key Players 2022- 2029") categories, such as research, design, coding and more. In steady economic periods, founders are eager to launch their [product or service](https://www.financedigest.com/productivity-and-the-four-day-working-week-in-financial-services.html "Productivity and the four-day working week in financial services") and attend to any issues that crop up as and when. This is an iteration-based approach. However, during a recession this is not the path to go down as the ability to iterate can become limited. The solution, therefore, is to eradicate as much uncertainty as possible before your [product launch](https://www.financedigest.com/new-product-launches-to-put-the-cod-liver-oil-market-in-a-good-stead.html "New Product Launches To Put The Cod Liver Oil Market In A Good Stead"). UX [research is hugely](https://www.financedigest.com/research-from-epos-reveals-a-huge-disparity-about-the-return-to-the-office.html "Research from EPOS reveals a huge disparity about the return to the office") beneficial in preparing for this. It helps you to: - Certify designs and features before implementation to avoid a reimplementing cycle - Reduce the number of [support tickets or manual onboarding time](https://www.financedigest.com/why-now-is-the-time-for-banks-to-use-their-data-to-support-customers.html "Why now is the time for banks to use their data to support customers") through better usability - It [increases perceived value and makes your product easier to sell](https://www.financedigest.com/taylor-wimpey-espana-remain-cautiously-optimistic-as-average-selling-price-increases-by-20-4.html "Taylor Wimpey España ‘remain cautiously optimistic’ as average selling price increases by 20.4%") - Reduces necessary budget to acquire new users through self-signups and high NPS During this tough period, it’s [important to remember that a recession isn’t a death sentence and that there are key preventative](https://www.financedigest.com/eu-seeks-deal-on-law-preventing-import-of-deforestation-linked-goods.html "EU seeks deal on law preventing import of deforestation-linked goods") measures that can be taken to ensure your business isn’t bowled over by hard economic times. --- This blog is powered by Superblog. 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