When the recession ends, how long will it take for U.S. businesses to recover from the way they survived it?
Lane Wallace of the Atlantic considers that question today:
A friend of mine who runs a management and innovation consulting business recently told me that almost all of his clients were responding to the recession by making drastic cuts in budgets and personnel, including innovation, R&D, product development and marketing efforts. “The problem with that,” he said, “is that when the economy recovers, it’s going to take them another two years to ramp up again. They won’t even have the right personnel or teams in place anymore. They’ll be way behind.”
To explain risk vs. uncertainty, she uses the metaphor of a sailing race in a storm, in which the sailor who let out sails takes advantage not only of a favorable wind, but also of the sailors who trimmed their sails.
We forget that sometimes, in our canonization of the innovative heroes of America. Or … maybe we don’t forget it. Perhaps the reason we give such great lip service to taking innovative risks but don’t, as a market whole, tend to follow suit … especially in tough economic times … is precisely because we understand quite clearly the risks involved. As the saying goes, “Nobody ever got fired for buying IBM.” Playing it safe may not win the race, but it’s less likely to end up with you going down in flames.
On the other hand, as the former CEO of Continental Airlines once said, if you’re in the pizza business and you just keep cutting one topping after another, pretty soon, all you have is crust. And it’s hard to sell crust.
I’m not asking you to reveal your company’s secrets here, but what did your firm stop doing that was strategically important before the recession, but was deemed worthy of sacrifice once it started?