Two years on, what has changed?
On the bright side, the US economy shows signs of recovery and unemployment is low. But the historically low interest rates continue and the number of people actively looking for work is low thereby artificially lowering the unemployment rate. How much of the recovery is real and how much is illusion?
China continues its march towards a consumer driven economy. But those at the helm don't seem to know which economic levels to pull resulting in a slowing of their economic output. This is entirely new territory for them and we can expect a 'trial and error' approach for some time.
The price of oil has collapsed which has added dollars to everyone's wallet while creating a void in their pension plans.
Europe continues to slowly recover only to be over-run with refugees from the Middle East and a corporate melt down at the world's largest auto maker.
Japan continues to wallow in tepid growth (since the late 80's) and no amount of quantitative easing seems to make much of an impact.
Christine Legarde's comments seem more and more true. We are in a lost decade. We are 7 years on from the beginning of the Great Recession and nothing really seems all that different. We have put lipstick on a pig and think that things are rosy.
As a leader, how are you coping? How are you reacting? How are you planning?
If you are not sticking to the fundamentals of business, frankly you are at risk. Cash flow and profit are not dirty words; they are essentials to a sound business. Planning and executing strategically are crucial factors to your success and sustainability. This is not the time for ill-considered expansion or acquisitions. Fire sales usually indicate that a fire is occurring and you don't need to spend resources putting it out.
There is no early end to our current predicament. We have already played most of the cards in the deck and have not found the winning hand. Be committed to delivering excellence in all aspects of your enterprise and you will be one of those who emerges from the other side of this worm hole. You will achieve this through some simple and basic principles:
- Attract and retain the best people in your industry.
- Develop an achievable and sustainable strategy that is well communicated and understood throughout your company.
- Provide regular, honest feedback on the company's performance.
- Look for input from all sources and consider all suggestions. Often the people on the front lines have the keenest insight on opportunities to improve.
- If you are a small to mid-sized company, find a mentor who has demonstrated success. Network with like competitors in other regions to share experiences, both positive and negative. Be open to the fact that you cannot know everything.
- Plan with the anticipation that the current business climate is here for the foreseeable future and that you must expect the unexpected. You will need to be creative, flexible, adaptable and reactive. In uncertain and troubled times you cannot always be pro-active. What defines your success it is your ability to respond to issues rather than your ability to predict them.