Recession Roulette
There is a general sense of relief and optimism as the world steps out of the recession crisis. Most of the major economies are either back in the positive or on the trail to recovery. At the end of it, there are lessons to be learnt in every sector – starting from simple home truths to ones related to management virtuosity. Without doubt, the necessary and sufficient conditions for the crisis safeguard measures are going to be rewritten in the process.
Roulette is a game of chance and all one knows definitively before the bet, is the house edge or the odds. Crises, as we had seen during the economic recession, are more often than not always different, and there is a significant chance factor involved in its management. Nevertheless, crisis lessons help in as much as understanding and managing the future situations better.
As the world community emerges from the meltdown turmoil, battered but wiser by the hard facts of recession, there are key lesson areas to focus and introspect for future safeguards.
We the world: The global integration of financial and other markets is a reality and this trend is going to intensify. According to IMF estimates, the BRIC (Brazil, Russia, India & China) economies now collectively represent a fifth of the world GDP with US accounting for another fifth, reflecting the multi polarity of the world economy today.
In the recession analysis, the economic pundits have talked about the balance of economic reliance between US, Euro and the developing countries, the over austerity of Japanese economy and the conservativeness of Germany. The fact remains, in a closer world all have contributed in a way to shape the economic situation of today and none is perhaps insulated from the others, the scale of influence notwithstanding.
The growing importance of G20 is a clear indication of the cohesive efforts being attempted in giving the economic contour of the world a balanced, collaborative shape with more member countries being part of the high table of management.
For whom the bell tolls: The great evolutionist Charles Darwin said – it is not the strongest of the species that survives, nor the most intelligent, it is the one that is the most adaptable to change.
A simile in the corporate context will be, those organisations which are flexible enough to adapt to the changing economic situations stand a better chance of survival. In a sense, the adaptability requirements relate to not only to economic condition alone, but also to the other elements of the macro operative environment. The increasing pace of change is now a truth of life, not to be ignored in thoughts and action.
Innovation ahoy: Recession lessons have indicated explicitly the expectations from the industries – to become more innovative, challenging the status quo. In the life after recession the call for innovation is now more real.
As the Harvard Business blogs aptly put it:
How Innovation Thrives In a Crisis - innovation thrives in a crisis as constraints are innovation enablers; the economic crisis has done innovation movement much good in bringing it from the fringes of the corporate world towards the mainstream.
The Awesomeness Manifesto - the challenge of the 21st century isn’t entrepreneurial as much as it is creative.
Steps & strides: Recession experience recommends a mix of short and long term moves for better resource planning and input control. Both, small steps and the long strides are important in this respect.
Conduct of short cycle review meetings, ability to make quick operational decision is important in managing the immediate future. And, in managing now and the immediate future will depend how the organization come up to face the future in the long run.
What ifs: The McKinsey article Leading through uncertainty explains – the range of possible futures confronting business is great; companies that nurture flexibility, awareness, and resiliency are more likely to survive the crisis, and even to prosper.
Organizations must think expansively of alternative scenarios and create strategic and tactical options on real standby to cope better, on demand. This necessitates that scenario planning management is done with more serious efforts, sharper industry intelligence, in a simulative way, in an attempt to secure a better future perfect state of readiness.
In the post recession era, remodeling of certain industries would be the key for better market adaptability. For relatively new streams like e-learning this would be easier to manage as remodeling would not imply major structural changes.
On the other hand, the discipline being, cross-border in expanse and global in nature, a higher order in response speed and maintenance of benchmark standards will be called for in the other crisis lesson areas such as – new technology introduction, innovations, and cost / resource control. 
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