|
Turning Downturns Upside Down |
How to Reposition for Growth During Soft Markets. The
rules for developing a valuable business portfolio are
the same in good times as in bad.
Experience indicates that the highest value creators
use downturns as an opportunity to refocus their
businesses and become tougher competitors for the next
upswing. They have the courage to impose market
discipline on their own companies before the markets
impose it on them. They refuse to subsidize the
businesses, costs and capacity that could put the
company at risk, and, at the same time, invest in those
areas that will sustain the company in the future, even
as their competitors are cutting back investment.
In short, there are four key ingredients to their
success: knowing which businesses to back when resources
are scarce; knowing where to cut and where to invest
during periods of slow economic growth; knowing where to
reduce and where to increase capacity when demand
slackens; and knowing how to use decision rules to
create strategic flexibility.
pdf 2003 |
