TO SURVIVE the downturn, companies need to move beyond cost cutting to reposition themselves for the growth opportunities that still exist and where appropriate, should use this opportunity to make acquisitions at attractive prices.

That's the view expressed by Caroline Firstbrook, Accenture's strategy manager for the UK and Ireland who was in Dublin during the week.

"Products and services that appear to present good value will benefit at the expense of those that seem expensive.

"Sewing machines sales are up 300 per cent at John Lewis," she says.

Being thrifty has become fashionable, fed by a current media preoccupation with finding ways of cutting back on expenditure, she adds.

Not all consumer shifts are obvious, however. Department stores are reporting a 30 per cent growth in sales of high-end lipstick. These products are being bought by those who would formerly have bought big-ticket designer fashions which they can no longer afford but who still want to treat themselves.

"Moving early to anticipate and serve these needs can help establish strong loyalty and a sound base for future growth," she says.

This approach applies equally to business-to-business enterprises, who need to do their research to find out how their clients are managing the downturn.

She advises companies to reduce exposure to poor payers, streamline business processes through tools such as Lean Six Sigma and implement more rigorous performance management systems.

Corporate perks need to be reined in, not only to save cash but to send a signal to the organisation about financial discipline. Pension obligations need to be addressed and renegotiated, where possible, she adds.

Conversely, a downturn also presents an opportunity to upgrade human capital, tailoring it more closely to the future operating model of the company, she says.

Despite redundancies being on the agenda for many companies, "the fundamental challenge of a talent shortage in key areas remains a critical issue for many businesses. Companies could use the current market environment as an opportunity to address this," she notes.

Firstbrook says that the recession also provides an excellent buying opportunity for companies that have strong balance sheets. While there is an argument to wait a little longer in anticipation that assets prices will fall further, the best assets are likely to come to market early because sellers will want to avoid connotations of a "fire sale".

"This is not impulse shopping," she says. "You need to be clear that any acquisitions need to fit with your existing strategy or give you access to new skills or a new market as part of your overall planned strategic development."

Equally, she says that some companies may wish to use the opportunity to divest themselves of non-core assets and where this is the case, they should act quickly and decisively.

She quotes one pundit who says, "Don't panic, but if you do panic, panic early".

Selling core assets is a much more dangerous strategy and should only be considered as a last resort, she adds.

Firstbrook also advises companies to try to look beyond traditional western markets to growing economies such as Brazil, Russia, India, China and South Korea.

Volkswagen, she points out, recently reported that for the first time it was selling more cars in China than in Germany.

"Companies who fail to establish positions here during this period of rapid growth will find it much more difficult to break in at a later point," she warns.