Succeeding in the new economic environment – three targets for leaders

Abstract

Companies are now struggling to cope with the most severe recession in more than half a century. This paper aims to study how leading companies have successfully reacted to the crisis. The researchers identified early winners in the current recession, beginning with large US-listed companies whose stock appreciated by at least 5 percent in 2008, at a time when the S&P declined by 37 percent. They looked at best practices of 61 companies. Winners have learned to ask, “Which strategies will allow the company to both survive in this economic transformation and, potentially, to thrive in it?” Overall, the early winners the following: focus on value via sustainable strategies that emphasize long-term value; exploit opportunities presented during downturns, including growing through low-cost acquisitions and stock buy-backs; and act quickly, with the agility to respond ahead of, or at least to keep pace with, rapid changes in the new economic environment. As winning firms have learned, there are the three targets for leaders in the new economic environment. The article offers a how-to guide to achieving them: leadership target no. 1: focus on value; leadership target no. 2: exploit opportunities; and leadership target no. 3: make speed a competitive advantage. © 2009, Emerald Group Publishing Limited