“If you are letting all this recession talk defer your plans for growth, you’re doing it all wrong!” – Futurist Jim Carroll
History has taught us that those who win during periods of economic uncertainty are those who double down on strategies for growth, accelerate R&D, focus their sales efforts on top customers, and maintain or boost marketing while others cut back, and refocus on digital customer experience.
Ya, I’m focused on that recession thing again! That’s because that’s where the growth in my speaking activities is!
It’s interesting but tragic watching all the tech company layoffs. Flush with cash, profitable, and not in terribly dire circumstances, they all seem to be lemmings following each other in a rush to cut staff. The round of layoffs seems rather mindless – if you dig beneath the announcements, you’ll see that is just a bit of a slash-and-burn exercise. In the meantime, their free cash flow last year?
Apple: $101.8 billion
Google: $67.0 billion
Microsoft: $60.7 billion
Facebook: $39.1 billion
Nvidia: $8.1 billion
Adobe: $6.9 billion
Salesforce: $5.5 billion
PayPal: $5.4 billion
Tesla: $5.0 billion
Airbnb: $2.2 billion
Zoom: $1.7 billion
Um, sure. They’re hurting badly! In the meantime, those who are being let go find themselves the casualties in what just seems to be a race to please the stock overlords on Wall Street.
The thing is, their erratic activities seem to be setting the tone for everyone else. “Tech companies are laying people off? That’s bad! Maybe I should do some layoffs too!” It fuels a belief that we are in dire economic straits, and that drastic action is needed. What this is doing is exposing the fraud behind the veneer of some ‘brilliant’ CEOs and senior executives – they really aren’t that smart, because they don’t know of the lessons of the past that have taught us about growth during uncertainty. Their ‘leadership’ skills are pretty marginal at best – it’s times like these that rip away the veneer of competence and the illusion of ability.
Anyone can cut costs. Real leaders grow their revenue. Those are the CEOs who get it.
I was on a video call with the CEO of a client organization in the insurance industry yesterday. I’m with them next month; we spent some time with him and his team to walk through my potential discussion points. And I can tell you while he was excited with my content, he also became very excited when I spoke about my approach to the topic of A.I. That excitement continued when I spoke of the fact that I’m seeing many organizations ‘simply choose not to participate in any potential downturn,’ and that I could work this detailed insight into my keynote.
The A.I. topic is moving fast and drawing quite a bit of attention; I’ve been sending out this little bit of marketing collateral for those who inquire; details are at https://ai.jimcarroll.com
But avoiding the recession by choice? A topic that’s on fire!
I dug out a fascinating observation by professional services firm Grant Thornton on a survey they undertook to gauge the executive mindset on innovating despite uncertainty. More than 50% planned to double down on innovation in a downturn. A key observation?
“They don’t intend to just retrench and try to ride it out. Most are counting on continued investment in technology and innovation to push them through.”
That echoes my own findings. Last fall, I undertook a massive research effort involving a few thousand articles on how companies worldwide approached past periods of economic uncertainty and downward growth. The differences couldn’t be starker.
The ‘losers’ or those with marginal or negative growth had these commonalities:
- they saw post-downturn heavy cost-cutting
- scaled back of R&D
- quality talent was lost
- strayed out of their core business to try to find a path forward
- took a wait-and-see approach
The winners? Positive growth?
- played on the offensive but selectively
- accelerated their R&D spend
- focused sales efforts on top customers
- maintained or boosted marketing while others cut back
- focused on digital customer experience
Need a strategy for innovating for growth in uncertainty? It’s right there in those bullet points – and that’s what I’m concentrating on in my “Innovating for the Upturn” keynote.
The opening observation in the keynote description?
Conventional wisdom would suggest we’d better hunker down, scale back, slow down, take it easy, be cautious, reduce spending, defer our actions, wait it out, take things slow, and put things on pause. But history tells us that doesn’t work – because those who choose to relentlessly focus on growth are those who win.
History teaches us everything we need to know right now. I’ll remind you of the simple fact that those who chose NOT to participate in the downturn – by doubling down on growth – saw significant returns, locking in gains of 13% CAGR in the years after the downturn compared to the ‘losers’ stalling at 1%. If you missed the post, it’s here – “Opting Out.”
Bottom line? It doesn’t take a lot of leadership skill to ‘slash and burn‘ – indeed, I believe it to be a sign of leadership weakness and failure.
It takes tremendous effort and is a powerful leadership skill, to grow through uncertainty. That’s real leadership success.
I’m pretty happy that it’s the CEOs who are focused on the latter who are discovering me – and my growth message – and bringing me into their events to talk to their team to help to set the tone.