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There will certainly be more uncertainty…

Posted: March 10th, 2009 under Business, Change Management, Crisis Management, Economics, Globalisation, Networked Economy, Offshoring, Outsourcing, Restructuring, Scenario Planning.
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Matthew Wolstenholme at March 10, 2009 : 8:02 am

Managers need to understand their options, then select and apply the ones that suit their scenario, quickly.

Gordon Brown consistently argues that the recession in this country is the result of a universally unforeseen global banking meltdown that began in the US (except when the PM is speaking in the US, that is) not domestic policies. At the same time, he and many others argue that the tide of globalisation must not be rolled back - that promoting an increasingly networked economy remains the best way to drive up prosperity. These long term trajectories may make sense, but many firms are now just focussed on managing immediate and unwanted change, and securing revenues this month and next.

Some firms are now refusing to publicly commit to revenue forecasts for this coming year, citing the kind of extreme uncertainty that makes any firm financial projection seem foolhardy. Other firms are using tools such a scenario planning to produce both plausible financial reports in the form of ranges, and to prepare for adjusting their strategy, should still more unfortunate events unfold.

This is part of a wider pattern, Now, leaders everywhere need to revisit the management concepts best suited to tackling a downturn. Leading through the storm requires different tools than riding the crest of a wave. Managers need to understand crisis management, restructuruing and transformational change. They need to think quickly and differently about cost management concepts such as outsourcing, offshoring and BPR.

Managers need to understand their options, then select and apply the ones that suit their scenario, quickly. They understand the big picture, but survival comes first. That much is certain.

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