Seize Advantage in a Downturn

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More (mostly) helpful advice re the downturn from HBR is Seize the advantage in a downturn in which David Rhodes and Daniel Stelter of BCG offer thoughts to stabilize your business and find opportunities … but beware!

Good to see the Boston Consulting Group encourage us to focus on the core business (as we should have been doing in the first place), protect product development, look at competitors’ weaknesses etc. – and all with analysis too, rather than gut feel !

Unfortunate, though, that some of the proposals conflict, and some are positively dangerous. “.. begin with aggressive moves to cut costs and increase efficiency … some means of lowering break-even points are obvious: stripping out layers of the organization … consolidating central functions … “.

If you’re in danger of going under, maybe, but I keep coming across companies where everyone is ludicrously flat out and simply failing to get important things done. The strong impression is that many managements are grossly under-staffed, not top-heavy. And what goes out the door when you throw out those “time-wasters”? – the organization’s memory and knowledge of how to do simple, critical things. And those constant reorganizations do the same – in function after function, no-one knows how to do things because none of them have been there more than five minutes.

What you need in present conditions is settled people who really know what they are doing. [Reminds me of the three dimensions of organizational capability – the ability to do critical tasks well, fast, and cheap – see chapter 9 of Strategic Management Dynamics – analyst-driven obsession with doing things cheap does serious damage to doing things well, and fast.]

Then the article repeats that other current fad “Rethink your business model” – almost always wrong and in present conditions a bad distraction from making what you have work really effectively.

There’s some good stuff too though, so take a look – but with brain engaged!

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  1. digforleadership.com  January 19, 2009