Source: ‘Firms should devise survival strategies’ | The Herald June 9, 2017
Kudakwashe Mhundwa Business Reporter
LOCAL companies should devise survival strategies which are long term in nature to ensure sustainability in an uncertain global environment, Securities and Exchange Commission of Zimbabwe chief executive Tafadzwa Chinamo has said. Mr Chinamo told delegates at the third annual Actuarial Society of Zimbabwe convention that businesses should find ways of building resilience in uncertain times and be able to navigate through them.
“Companies should navigate through turbulence and adequately position themselves for growth.
“One could argue that the main reason for our corporate failures is that companies fail to position themselves as required by industries or sectors in which they are operational.
“So they react to challenges by implementing measures not suited to them and copy what others are doing.
“Take dollarisation, for example. It was fashionable in 2009 to acquire short term loans to fund capital expenditure and these were secured by overvalued properties. Most business saw others borrowing and they did the same. Right now we see the toll of destruction by way of property auctions and court applications,” he said.
Speaking on the sidelines of the convention Actuarial Society of Zimbabwe president Shepherd Fungura said this year’s convention gives participants an opportunity to come up with solutions on how companies can device survival strategies.
“We believe that companies should look at uncertainties that surround them and try to put down strategies that are long term in nature.
“We have been in a situation where our inflation was negative, that situation is beginning to change already so we had strategies based on a negative inflation forgetting that at some point we are going to have positive inflation.
“So we implore companies to have long term vision beyond what is happening now. The challenges we face may and will turn around and there will be opportunities in the future
“A long term vision helps us to be able to look into the future and a strategy that goes into the future is useful because we believe the current situation would change and if it changes with you having a strategy that you have put in place it helps the companies prosper than to just look at events as they just happen,” he said.