Slippery Season

‘Tis the Slippery Season! Snow, ice, slush, mud, moss, mould. And the thousands of injuries from the resulting slipping, falling, crashing and colliding clog the Emergency Departments and swell the case loads of radiologists, orthopaedics and ACC officers. I am a totally plastered member of the Hobbling Horde, having ruptured my Achilles tendon while attempting to leap a creek in a single bound. My only comfort is that Tana Umaga did his on the same afternoon – sadly we are both out of the World Cup frame.

You, my esteemed readers, are of a generation constantly participating in sports and outdoor activities, keeping fit and defying Time. The possibility of injury is a useful memo, particularly for selfemployed, to maintain a well-equipped Home Office, web and email communications network, and hefty ACC cover policy. With these in place, one’s client service can continue reasonably effectively through recuperation and rehabilitation.

I now segue from bodily to economic health. Because we confront a Slippery Economic Prognosis. To grasp the soap of market demand and forecast forward orders is almost impossible. Monthly budgets are a lottery, demand is spiky and without trend or logic, currencies slip and slide, and business confidence surveys are from another planet. We are three years into depressed demand and zero growth, the Christchurch impact on national accounts delays the recovery by (pick a number of years!), and export profitability (for USD denominated trade) is devastated. Despite the rosy boosterism of the Government 2011 Budget projections, we have much flatness and flaccidity ahead.

When comparing this recession (anti-boom?) with one previous, e.g. 1988 – 1992, we have had remarkably few plant closures and wholesale layoffs this time – so far. And the unemployment figures are surprisingly benign. However, as I recall, it was not until 1990 that the banks became really active in their Bad Loan / Asset Management processes.

So what to do? I believe the strategic mindset should be to accept a minimal-growth environment as the “New Normal”, and to manage your business within that frame, seeking productivity and smart improvements before BHAGs. As I wrote about in May 2010, now may be the best time to implement Lean philosophies into your organization. Spending only on what your customers are prepared to pay for!

However you move forward this month, take care and watch your step!