In ACCELERATING OUT OF THE GREAT RECESSION: How to Win in a Slow-Growth Economy, coauthors David Rhodes and Daniel Stelter, senior partners at The Boston Consulting Group, contend that the enduring legacy of the worst economic downturn since the Great Depression will be a prolonged period of slow growth. For smart companies, however, there will be tremendous opportunities to innovate, grow, outperform their rivals, and even define new markets.
To seize these opportunities, managers must accept and adapt to some new realities. The main one is that the global economy will not return to a high-growth state anytime soon—even new sources of growth, such as the rise of the Chinese economy, will not be sufficient to offset the reduction in spending of the U.S. consumer. On top of slow growth, the aftermath of what is being called the “Great Recession” will be defined by intense worldwide competition, activist governments, cautious consumers, highly engaged investors, and industry restructuring.
The authors outline strategies with a proven history of succeeding in recessionary times—strategies drawn from a detailed analysis of companies that survived and thrived during the Great Depression and other past recessions and whose stories are told in the book. First, managers must defend their businesses by driving down costs and protecting their business and financial fundamentals. They must then go on the offensive—by innovating, attacking competitors, capitalizing on changes in the environment, and employing game-changing strategies.
If choosing the right series of strategies is challenge enough, putting them into practice will be tougher still. The authors argue that managers will need to develop a “new managerial mindset”—because managing a company will feel altogether different in an era in which the margin for error is narrower than it has been in a long time.