Preparing Your Company for the Next Recession

By Donald Sull and Charles Sull Leaders should build resilience, local agility, and portfolio agility to prepare for the next recession. Winter is coming: Inverted yield curves, rising interest rates, and a rash of layoff announcements have convinced many economists that the global economy is headed for a downturn. 1. Recessions are bad for business, but downturns are not destiny. The worst of times for the economy as a whole can be the best of times for individual companies to improve their fortunes. One Study found that lagging companies are twice as likely to overtake industry leaders during a recession, relative to non-recessionary periods. 2. Another study, of nearly 4,000 global companies before, during, and after the Great Recession, found that the top decile of companies grew earning by 17% per year during the downturn, while the laggards saw profits stagnate or decline. The difference between the companies in the two groups translated into $6 billion in enterprise value on average. READ FULL ARTICLE>>