Volatility Is the New Normal: How Companies Can Protect Margins, Move Quickly, and Lead with Greater Confidence
Article written by Scott Green
I know you’re feeling it — I am too.
There’s a wave of pressure mounting on both businesses and consumers. Expert opinions on the economic outlook range from cautious at best to downright gloomy at worst. The challenge is putting a finger on exactly where and how the pressure will manifest.
Will there be further inflationary pressure? Where will it come from? And most importantly — how should we respond?
Volatility and inflation are a part of life on a global scale. If you’ve operated in BRICS markets, Mexico, Argentina, or Turkey, you expect these challenges nearly every year. But in the United States, this hasn’t been normalized. Businesses and consumers are still adjusting — and many feel we haven’t fully moved past the inflation of 2021–2022.
As a revenue and profitability management expert with over 25 years of experience, I remind executives and boards: volatile markets can disproportionately impact financial results. If you don’t stop the bleeding, all the progress you’ve made in other areas can be overshadowed.
So what should companies do?
Here’s a simple, proven approach:
(1) Build a Proactive Monitoring Process
Get closer to a real-time understanding of cost trends for key inputs. Establish connectivity between commercial, finance, procurement, and supply teams.
Create trigger criteria that signal when action is required.
(2) Create Playbooks Ahead of Time
Economic events often catch organizations off guard. Suddenly, the CEO or CFO pulls together a tiger team with a ‘go get’ directive. They need action — fast.
The biggest mistakes happen when companies rush into action without fully understanding their best options. A mad dash for data leads to hasty decisions with adverse impacts down the road.
Having a playbook in advance allows teams to focus on execution.
It should include guardrails and short-, mid-, and long-term actions to ensure structured, effective responses.
(3) Monitor the Effectiveness of Your Strategy
In a volatile marketplace, implementing your strategy can be harrowing.
Do I lead? Do I follow? How are competitors reacting? Building strong market intelligence capabilities is critical.
Monitoring real-time effects of your strategy allows you to adjust for the right outcome. If you’re losing share, pivot. If you’re maintaining share, refine your approach.
When You Need Support…
Every moment of inaction erodes your margins and revenue.
At Profit Drivers, we help businesses navigate volatility with confidence. In just 4 weeks, we’ll have you up and running with a structured execution plan that delivers immediate impact.
I just returned from a trip to Australia and New Zealand — part of a global journey talking with leaders about uncertainty and volatility.
By now, they’ve all accepted: It’s not a question of if there will be impacts — but when.
The underlying sentiment ranges from caution to trepidation. I heard about ‘organizational fatigue’ — a natural reaction to this anxiety-inducing environment we’re in. On the plane rides home from Down Under, I briefly pondered adding therapists to Profit Drivers’ offering. But clearer thinking on the ground led me to conclude:
Our best role is to provide assurance that there is a right path forward.
In this case, we have an example right in front of us.
Mattel’s CFO, Anthony DiSilvestro, recently shared how they’ve created a playbook — leveraging their global supply chain and preparing for potential price increases. We’ve been hearing that many companies don’t have a plan in place. If that sounds familiar, now is the time to begin taking proactive steps.
Start with:
- Create Transparency & Expand Your KPIs – Track the forward view of cost drivers like commodity input costs, labor, and freight — down to a SKU level. Add demand drivers like consumer confidence or housing starts.
- Build Playbooks – Have a series of short-, mid-, and long-term mitigation actions to ‘land the plane’ effectively. Don’t only think about this as a tariff-fighting playbook — shifts in end-customer demand or currency fluctuations could arise at the same time.
- Reinvigorate Market Monitoring – Gain real-time insight into the execution of your strategies and tactics. Understand end-customer sentiments to track real shifts happening on the ground.
Need Support?
Volatility isn’t going away — but that doesn’t mean your margins have to suffer.
If you don’t have a clear plan in place to monitor costs, adjust pricing, and respond to shifts in demand, now is the time to build one.
Profit Drivers is a trusted partner to companies navigating uncertainty. We specialize in pricing and margin optimization, leveraging decades of real-world practitioner expertise to help businesses protect profits and respond with confidence.
Let’s connect.
