Managing in a downturn: leading business thinkers on how to grow when markets don't

185 Pages·2009·2.685 MB·English

by  Gulati, Ranjay

9780273730057_MIAD.qxd 24/6/09 12:25 Page 1
AS SERIALISED IN THE FINANCIAL TIMES
LEADING PERSPECTIVES ON THE RECESSION
MMaannaaggiinngg iinn aa DDoowwnnttuurrnnfeatures
contributions from the following leading With the recession now clutching us
experts: in a firm grip, it can be difficult to
MANAGING IN A DOWNTURN think beyond the doom and
Paul A. Argenti
gloom. For senior managers and executives,
Julian Birkinshaw
navigating through turbulent times is never
Arturo Bris
easy. From Bear Stearns and Lehman
Murillo Campello
Laurence Capron Brothers to General Motors and Woolworths,
LEADING BUSINESS THINKERS ON HOW M A N AG I N G
Robert Clemen the fall-out from the first severe downturn of
Vasant Dhar the 21st century has yet to play itself out. In
B. Espen Eckbo TO GROW WHEN MARKETS DON’T
such uncertain times, the instinctive reaction
Nuno Fernandes M
can be to cut costs and hunker down until
Pankaj Ghemawat A
things get better. But retreating into a
Michael Gibbs N
Rob Goffee A protective shell is not always the right
John Graham Managing in a Downturn brings together the world’s leading G decision for the long term health of your
I
Lynda Gratton business thinkers on the big questions confronting managers N IN A business. Indeed, a downturn can present a
G
Ranjay Gulati
and executives in today’s painfully credit-crunched times. great opportunity for companies to
Neal A. Hartman I
N reposition themselves, scour the market for
Campbell Harvey
Thomas M. Hout What can businesses do to minimise short-term pain and A good deals, recruit talent from competitors
and, ultimately, equip themselves for
Michael G. Jacobides maximise long-term competitive advantage? D
Huw Jenkins Are there lessons to be learned from previous downturns? O D O W N T U R N sustainable long-term success.
W
Katherine E. Jocz
Gareth Jones And what will the future business environment look like? N Managing in a Downturn brings together a
T
Kevin Kaiser
U range of leading business experts to offer
Jean-Pierre Lehmann This premium collection of cutting edge business thinking will R
their observations and new business
Peter Lorange N
help you get a clear perspective on the downturn, how it thinking on surviving – and even better,
Ilian Mihov
Nitin Nohria could affect your business and how to manage through it. thriving – in an economic downturn.
John A. Quelch
Suzanne Rosselet-McCauley Hear what the experts have to say.
Andrew Scott
Christian Seelos LEADING BUSINESS THINKERS ON HOW
ManMohan S. Sodhi
Stefan Stern
Paul Strebel TO GROW WHEN MARKETS DON’T
Donald Sull
Arun Sundararajan £14.99
Jayashankar M. Swaminathan ––––––––––––––––––––––––
Christopher S. Tang BUSINESS
––––––––––––––––––––––––
Daniel Vermeer
Visit our website at
Russell Walker
www.pearson-books.com
Batia Mishan Wiesenfeld
Visit our website at
www.pearson-books.com
A01_FT0057_01_SE_FM.QXD:Layout 1 18/6/09 12:09 Page i
Managing in a Downturn
A01_FT0057_01_SE_FM.QXD:Layout 1 18/6/09 12:09 Page ii
Inanincreasinglycompetitiveworld,webelieveit’squalityof
thinkingthatgivesyoutheedge–anideathatopensnew
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That’swhyweworkwiththebestmindsinbusinessand
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A01_FT0057_01_SE_FM.QXD:Layout 1 18/6/09 12:09 Page iii
Managing in a
Downturn
Leading business thinkers on how to grow
when markets don’t
A01_FT0057_01_SE_FM.QXD:Layout 1 18/6/09 12:09 Page iv
PEARSONEDUCATIONLIMITED
EdinburghGate
HarlowCM202JE
Tel:[phone]
Fax:[phone]
Website:www.pearsoned.co.uk
FirstpublishedinGreatBritainin2009
©FinancialTimes2009
ISBN:978-0-273-73005-7
BritishLibraryCataloguing-in-PublicationData
AcataloguerecordforthisbookisavailablefromtheBritishLibrary
LibraryofCongressCataloging-in-PublicationData
Managinginadownturn:leadingbusinessthinkersonhowtogrowwhenmarketsdon't.
p. cm.
Includesbibliographicalreferencesandindex.
ISBN978-0-273-73005-7(pbk.:alk.paper) 1. Management. 2. Businesscycles. 3.
Businessplanning. 4. Recessions.
HD31.M2941452009
658––dc22
2009020861
Allrightsreserved.Nopartofthispublicationmaybereproduced,storedinaretrieval
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Thepublisher’spolicyistousepapermanufacturedfromsustainableforests.
A01_FT0057_01_SE_FM.QXD:Layout 1 18/6/09 12:09 Page v
Contents
Foreword/vii
Surveying the damage
part1
1 Timeformanagerstostandanddeliver(StefanStern)/3
2 Keepingtheglobaleconomyafloat(IlianMihov)/7
3 Thebigfreeze(JohnGrahametal)/14
4 Scandinavia:Failedbanks,statecontrolandarapidrecovery
(B.EspenEckbo)/22
5 Japan:Hubris,denialandthelossofconfidence
(Jean-PierreLehmann)/28
6 Seizingtheupsideofadownturn(DonaldSull)/32
7 Managingfluctuations(AndrewScott)/40
8 Deathofthedecouplingmyth(SuzanneRosselet-McCauley)/45
Getting through the crisis
part2
9 Fortunefavoursthewell-prepared(RussellWalker)/51
10 Howtotalkyourwaythroughadownturn(PaulA.Argenti)/57
11 Gettingstaffonyourside(MichaelGibbs)/63
12 Optimistshaveabrightfuture(PeterLorange)/68
13 Rethinkinglinksintheglobalsupplychain(ManMohanS.Sodhiand
ChristopherS.Tang)/72
14 Lookinglongtermonthepassageto‘Chindia’(JayashankarM.
Swaminathan)/77
Looking beyond the crisis
part3
15 Keepingakeeneyeonconsumerbehaviour(JohnA.Quelch&
KatherineE.Jocz)/83
A01_FT0057_01_SE_FM.QXD:Layout 1 18/6/09 12:09 Page vi
vi Contents
16 Tastingthefruitsofeffectiveinnovation(RanjayGulati&
NitinNohria)/89
17 Surewaystotackleuncertaintyintoughtimes(NealA.Hartman)/95
18 Pluggingintotransformation(VasantDhar&ArunSundararajan)/98
19 DoesyourM&Aaddvalue?(LaurenceCapron&KevinKaiser)/102
20 Thetimeisripeforfreshideas(LyndaGratton)/106
21 Playfairwithworkerstoreaprichrewards(BatiaMishan
Wiesenfeld)/111
The future business environment
part4
22 Newthinkingonhowtodobusiness(MichaelG.Jacobides)/117
23 Whysustainabilityisstillgoingstrong(DanielVermeer&Robert
Clemen)/125
24 Timetobringrealshareholdersbackonboard(PaulStrebel)/130
25 Newmodelsforthefuture(ChristianSeelos)/133
26 Sovereignwealthrevalued(NunoFernandes&ArturoBris)/138
27 ChinaandIndiatakeonthemultinationals(PankajGhemawat&
ThomasM.Hout)/143
28 Personalisingriskmanagement(JulianBirkinshaw&HuwJenkins)/151
29 Thechallengesfacingleadership(RobGoffee&GarethJones)/157
Abouttheauthors/161
Index/164
A01_FT0057_01_SE_FM.QXD:Layout 1 18/6/09 12:09 Page vii
Foreword
In the current economic and financial climate, it is difficult for many
businesspeople to think beyond the doom and gloom dominating the
headlines.SincethecreditcrunchbeganinearnestinAugust2007,when
the European Central Bank injected €95bn worth of funds into the
money markets, it has continued to gather momentum and threaten or
destroysomeofthebiggestnamesinthebusiness.FromBearStearnsand
Lehman Brothers to General Motors and Woolworths, the fall-out from
thefirstseveredownturnofthe21stcenturyhasyettoplayitselfout.
For senior managers and executives, navigating through turbulent times
is never easy. The instinctive reaction is to cut costs and hunker down
until things get better. But retreating into a shell is not always the right
decision for the long term. Indeed, a downturn can present a good
opportunityforcompaniestorepositionthemselves,scourthemarketfor
deals, recruit talent from competitors and, ultimately, equip themselves
forsustainablelong-termsuccess.
ManaginginaDownturnwasfirstpublishedintheFinancialTimesandon
FT.com,andbringstogethertheworld’sleadingbusinessthinkerstocon-
sider some of the big questions confronting managers. What lessons – if
any – can be learnt from previous downturns and how organisations
functioned in those difficult times? What can businesses do to minimise
the short-term pain and maximise long-term competitive advantage?
Andwhatwillthefuturebusinessenvironmentlooklike?
We do not claim to have all the answers, but hope we can offer some
signpostsforthedifficultjourneyahead.
A01_FT0057_01_SE_FM.QXD:Layout 1 18/6/09 12:09 Page viii
M01_FT0057_01_SE_C01.QXD:Layout 1 18/6/09 12:09 Page 1
part
one
Surveying the damage