The Middle Path to Success
I love it when research supports my intuition. I suspect that’s a basic human reaction, “See, I knew that!”
I just found an article on the AmEx open forum that references a recent HBR article called Roaring Out of the Recession. The authors did a year-long study of the performance of 4,700 public companies before, during, and after the last three economic recessions in America (1980-82, 1990-91, and 2000-02).
What they found: the companies that did best – by quite impressive margins – were those that reduced costs selectively by focusing on operational efficiency (vs. across-the-board cost-cutting), at the same time invested in the future by spending on marketing, R&D, and new assets.
Which (I’m bragging a bit now) is precisely what I suggested in a series of posts I wrote last year, on May 14, June 11 and August 19. Fortunately, we’ve also been making this recommendation again and again to our clients over the past year: Re-trench smartly; make sure you’re operating as efficiently and cleanly as possible; don’t hold on to people, processes, or products that aren’t working. AND focus on growth and success; keep envisioning your hoped-for future and figure out how to get there.
Our clients seem to be doing well, and that’s the important thing. But it’s nice to have the data on our side, too!