For many industries, 2010 will bring a distinct improvement in the trading environment. For individual companies within each industry – that’s you and me – the manner in which they respond during 2010 will lay the foundation for success (or otherwise) for the next five to ten years. There are three ways to respond to economic recovery, each of which builds on the others to provide a stronger platform (and a longer timeline) for success:
1. Reclaim.
Basic recovery is a reclamation process, concerned solely with getting the organization back to, or near, the trading levels it was at before it was hit by the economic downturn. Conservative or lagging organizations organizations in ‘reclaim’ mode will slipstream the rising tide of economic upturn and add cost only when absolutely necessary. Focussing externally, they will re-enter abandoned markets where possible, sell more to existing customers, and seek to win back any business they lost to competitors in the downturn.
2. Restore.
More aggressive organizations will seek not just to to reclaim their external position in the marketplace, but will also work to restore important elements of their internal culture: those practices and norms that were weakened or lost during the last two to three years. People practices in particular – hiring, retention and development activities being among the first to wither in a recession – will be recognized as crucial to the organization’s vitality and restored.
3. Renew.
Those organizations that will come through 2010 in a leading, rather than lagging position will be those who not only reclaim their external markets and restore their internal culture, but those whose leaders have the courage (and take the time) to renew what they do, and how they do it: specifically, to redefine anew, then teach and enforce what effective management means in their organization.
Put obversely: those organizations which continue (consciously or unconsciously) to expect and encourage the same skill-set in and from their managers as they did pre-2008, will find that those managers, and by extension, the organization as a whole is not equipped to compete in the post-recovery economy. Fail to transform your managers and you will live in the exhaust fumes of those who do.
More later on what that new skill-set for managers looks like, but for now, what will your organization do in 2010: Reclaim, Restore, or Renew?