With GDP Contraction Suggesting Recession, Do U.S. Businesses Have the First-Hand...

With GDP Contraction Suggesting Recession, Do U.S. Businesses Have the
First-Hand Experience to Manage Through It?

CHICAGO, Oct. 30 /PRNewswire/ -- Recently in a speech to the Economic Club
of New York, Federal Reserve Chairman Ben Bernanke said, "The problems now
evident in the markets and in the economy are large and complex, but, in my
judgment, our government now has the tools it needs to confront and solve
them." [October 15, 2008] On the same day, Janet Yellen, San Francisco
Federal Reserve President in a speech at the Silicon Valley Chapter of
Financial Executives International remarked, "Indeed, the U.S. economy appears
to be in a recession. This is not a controversial view." Now with today's
Commerce Department report confirming that the gross domestic product (GDP)
contracted at a 0.3 percent annual rate, it does appear that there is very
little controversy left about the health of the economy.
With today's GDP data in mind, knowing that the government has the tools
or the plans to use them during this apparent recession is reassuring, however
Michael Welles, director of EdWel, a management training company, suggests
that business, just like the government, should also take stock of the tools
in their toolkit. An important tool, according to Welles, is whether or not
current managers at the company have the adaptive skills to manage through a
recession?
With the Bureau of Labor Statistics counting over 1.7 million general
operations managers in the United States and, arguably, hundreds of thousands
more in supervisory positions, just how many of them have managed through a
recession before? With the last recession ending in early 2002, from the
National Bureau of Economic Research (NBER), and the previous recession
finishing a full a decade earlier, do a company's current management ranks
have the first-hand experience to adjust to a harsh business environment --
reduced customer demand, tightening cash positions, and stressed-out workers?
'Even if a current manager did thrive in the past, the time between today and
the last recession is such that companies should expect some diminishment of
skills', remarks Welles.
According to Welles, current managers can take these steps to adapt to
this recession:
1. Start a new conversation with your customers. In just the last few
months, your customers' businesses have changed dramatically. Recognize the
changing dynamic and ask them about their new needs and challenges. Work with
them to modify your products/solutions to meet their new reality.
2. Reinforce the employer brand. Recognize that layoffs and extreme cost-
cutting will affect an employee's perception of your company. Rethink
existing employee development plans and provide low-cost development
opportunities so that high-performers will still consider your company a
'great place to work'.
3. Cash in not always king. While having a strong cash position is
critical to surviving a deep recession, you should still make judicious
investments in technology, infrastructure, and employee development. Just
like in the residential real estate market today, reduced prices from
suppliers might make this a great time for your business to buy.
4. Leave best practices behind. Being just as good as your competitors
won't cut it during a recession. Create new business best practices that
leapfrog accepted industry best practices in both customer care and product
value.
About EdWel Programs
EdWel is a management training and consulting firm specializing in
information systems and product development. Since 1992, EdWel has trained
over 22,000 managers in a variety of course topics and consulted to hundreds
of projects for its North American clients. For more information about EdWel
Programs, please visit http://www.edwel.com. Contact information for Michael
Welles 800.544.1995
SOURCE EdWel Programs

Michael Welles of EdWel Programs, +1-312-654-1995, mwelles@edwel.com