When a country enters a state of war or crisis, businesses instinctively react by focusing on survival. market shrinks, liquidity decreases, user behavior shifts, and operational rise. In this situation, what can a digital business do to prevent a collapse is a “Contraction strategy.”
What are the points of Contraction Strategy?
1: Resources
- Realize the team based on the real value of role.
- Conduct “role-based evaluation” instead of layoffs.
- Which one of the roles are interchangeable?
- What is essential?
- The main goal is to eliminate waste without removing people, often through role changes or task restructuring.
Cost Reduction as an essential factor in managing business
In wartime, spending should be immediately: low-yield, unnecessary events, and luxury purchases.
Enhancing expenses such as data analytics or security infrastructure should generally be maintained, as they are value-generating in crisis.
Essential expenses—like servers, technical teams, and customer supports should not be cut but optimized.
More details about contraction strategy
Contraction in wartime, focusing on cash enhancement as unpredict reigns. Businesses should implement short-term sales, affordable subscription plans, economic packages, partnerships with complementary firms to maintain liquidity, ensuring that money inflow surpasses outflow. This strategy is not just short-term response but a crisis management skill; it is also a strategy to operate focused in business.
This policy note is written by Rasta Think Tank in 2026.
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