This article in the Financial Times Road to Recovery report looks at how business leaders should be managing their organisations in a recovery that feels like the recession. Mark Thomas, marketing and strategy specialist at PA Consulting Group, gives his views on how organisations can ensure they are winners in these testing times.
Mark warns that there is a “high degree” of overcapacity in most sectors. If a second dip in the economy did take place, he argues, it would have the useful effect of removing businesses that cannot easily become competitive. “For the health of the sector it’s better if they disappear, although this is a brutal thing for anybody employed by them or who supplies them,” he says.
The article goes on to comment that few executives would welcome such a prospect, but most would surely concur with Mr Thomas’s assessment that consumer behaviour is changing rapidly, and that therefore “anybody who’s assuming they can just continue to position their products and services in the way they did even as little as 18 months ago may be wrong”.
Mark adds: “Businesses that are expecting just to go back to normal and simply see this as a process of taking their foot off the brakes and back on the accelerator will suffer. Companies that see they are in a different world and work out how to compete in this world will be the winners.”
Companies should be ready to invest tomorrow but be selective about it, he suggests. That means taking a hard look at which parts of their business still have growth potential and which do not, and allocating spending accordingly.
You can read the article in full here