What we think...
The sudden downturn in the global economy has caught many people and businesses unawares. And I am certain that the upturn will do exactly the same. I venture to suggest that the upturn could be even more dangerous.
Businesses are affected in different ways by the downturn – we meet lots of different companies and public sector clients, so we are in a privileged position. Some are focused on efficiency (and we are used this theme at the heart of some of our work), while others are fire-fighting and being very tactical. There are good examples, however, of businesses that are not as affected, and some who are actively taking advantage of opportunities that come up very rarely. Indeed, a recent article quoted Sir Richard Branson as not only suggesting that the next wave of billionaires would come about through exceptional opportunities, but also saying that Virgin was going to become a bank. At exactly the time when everyone else is running away from banks!
So, looking forward I see the business world categorised into those who have slashed the heart out of their companies and those who have invested their resources very carefully in readiness for the upturn, keeping their best people connected to the business journey despite how tough that might have become. The former will be at their most vulnerable, as a sudden upturn will leave them weak in the face of well-prepared and fierce competition. Weak companies will be caught out in many ways – lack of ability to respond to renewed demand, lack of talent, mothballed development plans which are hard to re-start, and much more.
The real challenge that many managements face is how to survive in the meantime while positively preparing for a new future. A big part of the answer lies in the people of the business, leading and motivating them to look upwards and not down. It is amazing what can be achieved with fewer resources if people rally round strong leaders. These will be be the great companies of the next decade.