BY ART VAN BODEGRAVEN AND
KENNETH B. ACKERMAN
basictraining
The end is near.
Are you prepared?
FOR DECADES, A STAPLE OF CARTOONS HAS BEEN A SCRAGgly, bearded, besandaled zealot in shabby robes, bearing a placard
proclaiming “The End Is Near!” But lately we’ve started to wonder if
the bus backed up to the commune and emptied it of would-be
Jeremiahs, given how often The End has been announced as the
wreckage of the global financial crisis is examined. We even briefly
considered opening a sandal repair shop to help make ends meet.
We’re here to make a proclamation of our own. The End Is, in fact,
Near. But not the one the full-time alarmists would have you believe.
It’s the end of the recession that’s coming, and we need to figure out
how to prepare for what our friend Rick Blasgen, CEO of the Council
of Supply Chain Management Professionals, has
called the “post-recession rally.” We believe that getting ready to capitalize on the turnaround is far
more important than what we’ve done to try to survive the recession. Truth be told, how we’ve handled
the tough times sets the stage for how successful
we’ll be in the post-recession period.
LEADERSHIP IN TIMES OF CRISIS
We are distressingly willing to indulge in knee-jerk
reactions to challenging events, even to the detriment of future success. Maybe this is raw, fundamental human nature. Research has shown that
human beings respond to acute stress in one of two ways: the first is
to run like mad away from the stress; the second is to fight like crazy.
In business, these translate to: 1) hunkering down, hoarding cash,
furloughing people, delaying or canceling new projects, restricting
travel, and cutting out training and other organizational development activities; and 2) seizing the opportunities others are afraid to
go after, reinventing and repositioning organizations, and adapting to
a new world view.
Curiously, the former approach seems to be favored by leaders with
some financial background. You know, the ones who struggle to
understand the difference between headcount and human beings.
As for how this typically plays out in the business world, the traditional mega-corporations are big on flight, particularly when the burden will fall largely on a put-upon workforce. It’s the entrepreneurs
who are more likely to respond with reinvention, risk-taking, and
new approaches.
the shape of the recovery. Recoveries come in
three types: One is V-shaped, the quick, steep
rebound. Another is U-shaped, with a gradual
bottoming, followed by a gradual rising, followed
by a sharp upturn to previous highs. The third is
pie pan or bathtub-shaped, with a long, long flat
bottom before the turnaround begins. Whether
the new highs are as dazzling as those previously
attained is a matter of considerable debate, and
there is a wealth of uninformed speculation re-
garding the “new normal.”
If the recovery is V-shaped,
you’re too late to embark on a
remedial course; you should
have been doing the right
things all along. If the recov-
ery is U-shaped, you may or
may not be too late, because
the recovery will come fast
when it hits. If it’s pie pan-
shaped, you might have a little
time, but there’s still no sub-
stitute for having chosen fight
over flight at the outset. Your
more inventive and nimble competitors may
have made good use of the long flat spell to per-
fect their tactics.
Of course, if we hit a double-dip recession with
another downturn, there’ll be, unfortunately,
ample time to get ready for the “real” uptick.
That’s no reason to wait and see; the time to do
the right things is still now.
WHEN TO START?
When should you begin preparing for the rally? It depends a little on
WILL THIS COST MONEY?
As for what steps companies should take to prepare for recovery, the magic word is investment.
When others are pulling in their horns, tomorrow’s winners are investing. Specifically, they’re
investing in the following three areas:
▪ Infrastructure. This is the time to get equipment and technology that was too difficult to
cost-justify when the financial buggy was
careening out of control—particularly if you can
