What are three basic strategies for dealing with increased uncertainty with respect to customers, competitors, suppliers, or government regulations?
There are several strategies that can help businesses deal with an uncertain global business climate.
On a financial level, companies manage external risks by de-leveraging, maintaining liquidity, and building cash reserves. This is a particularly important strategy in credit crises, when credit may not be freely available.
On an organizational level, flexibility and decentralization enable a corporation to respond quickly to changes in the business environment.
On a strategic level, diversification is extremely important. In an uncertain environment, relying on a single type of product is a high risk strategy. A power company that has hydro, nuclear, coal, renewable and natural gas plants is better equipped to deal with regulatory and other changes than one with only one type of energy source.