When I was CEO, the senior staff would refer to my role as ‘sitting in the big chair’ – I find this is a warm and respectful way to refer to the leader of the organization, and continue to enjoy using it even today.
Through many, many conversations with top leaders of all kinds and sizes of organizations several common elements have emerged.
Get cash and hold it as cash – from the chair, the sense is to get and horde cash – do not shift into long-term or market-driven vehicles…got burned badly! With cash there’s agility and some insulation from the unknown.
Go Slow Taking On Additional Resources – organizations have trimmed staff, and cut expenses to the quick in the face of flagging demand and sales. From the chair, as times improve (which is not as rapid as in past cycles) - there is no hurry to rehire workers or to increase spending.
Demand and Sales Are Funky – demand is sporadic and had dropped almost to nothing in some sectors; sales are not being completed – committed orders are cancelled even at the last minute; even the government sector has made awards which do not receive funding: ker-ching>>No Sale! From the chair, there’s a growing ‘tentative sales’ category which is not recorded until the check clears. The demand and sales graph has almost flat-lined…a slight pulse can still be felt, but no rebound as in the past.
R & D Is NOT Robust – From the chair, research & development in process has slowed (funding is squeezed) and new projects are delayed or cancelled until the smoke clears on a view of future priorities in a diminished economy.
Planning Is Now Immediate Term – From the chair, real 3-year plans are non-existent in most organizations – same with meaningful 2-year plans; there is an annual budget plan, but in reality the working plan only goes out for about the next 6-months. Strategic plans are mothballed for now rather spending effort on updating with guesses about the economy.
But There Is Hope – Occupants of the Big Chair are rising to the challenge of a down & sluggish economy and have jolts of optimism as they see their markets show some signs of life. The consensus is the overheated go-go times are behind us and are history – recovery is happening BUT it will not bounce back to old levels and will grow slowly over time from the current minimalist position.
Collaboration and On-Demand Resources Are Now The By-Words – using someone else’s capacity when needed; contracting for workers with specific needed skills for the duration of a production run; working together with other complementary organizations -is the plan of the day. If sustained into the future, this is an interesting structural change in how we do business and opens up the opportunity wider for entrepreneurs and small firms to be an integral but independent part of the available resources for larger organizations (discussed in more detail in Getting Back To Normal).
The view from the big chair is that there IS movement in a positive direction in the economy – it is slow, but evident.
What’s the view from your chair? Any different?
Tuesday, January 18, 2011
What is Normal?
It is a mosaic of the things we know, the changes we experience, and the structural shifts that affect how we do business. It's our collective beliefs about the what – how – why – when – who of doing business. It is dynamic and changes as its elements change.
Long ago Normal was business correspondence written with a nib pen in your best cursive handwriting. Then came typewriters > the correcting Selectric electric typewriter > centralized word processing > PC-based word processing > email. Each step a change in what's considered Normal.
What is the New Normal?
During the past 2-years to 25-years how we do business has been changing and much of the evolution was doing the same things but using less resources or expanding into new (and usually non-domestic) markets. Normal was shaken up, got a bit tattered, and acquired some additional rhetoric when we spoke about it – but it was still recognizable as Normal. We 'd speak about 'getting back to Normal' but saw no movement back to that familiar place.
In the past couple of years, a New Normal has morphed (and is continuing to do so) into a vastly different descriptor of doing business – changes are surfacing that are nothing like those in the past, which are radically affecting how we conduct business. It is quite different from the past – New Normal...how things will be.
Here's two examples which emphasize the shifting focus to individuals and smaller organizations:
A couple of days ago, I went to a Google Talks session about App Developers and heard from a panel of 5 independents who write application programs for various portable and mobile devices (like tablet PCs & iPad, and the Android & iPhone). They create Apps to fill user needs, like: social media tools, communications/connections, storage of info, and games – sold over the internet. This has been the realm of the device manufacturers or software giants – and now is done by organizations of 1-10 individuals.
TV Week just reported that free-standing kiosks are now renting more movies that the bricks & mortar video rental stores. The kiosks are a hodge-podge of individual entrepreneurs and small companies.
These changes have evolved in just a few years and illustrate the shift in underlying structure of conducting business toward individuals and small organizations.
Is this just a couple of anomalies or does it show the tip of a strong trend? What do you think about the New Normal?
Wednesday, January 5, 2011
Dov Gorman of the Capital Technology Management Hub asked for an ongoing series of ten minute “Rainmaker” presentations before the monthly CTMH meetings – this is the next in the series.
On Tuesday January 11th, the free monthly meeting of the CTMH will be on the topic: “The Strategic Cloud – How Cloud computing enables the strategic transformation to IT as a service” – for details and to sign up go to: http://strategiccloud.eventbrite.com . Come join us!
Here's the handout:
Rainmakers: The Nametag
Who here has a name that is different from everyone else in the room?
Who has trouble remembering names?
How many events like this do you attend each year?
How about we each bring our own name tag?
If you were going to design you own name tag, what would you do?
What is the best thing you learned in the last five minutes?
To complete this exercise, please comment with the best thing you have learned at: http://blog.saleslabdc.com/2011/01/rainmaker-nametag.html
See you on Tuesday night! http://strategiccloud.eventbrite.com