Slicing through the Crisis

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Visit this group In times of economic crisis, old rules become irrelevant and new opportunities abound according to the Business Week article titled ‘Managing Through a Crisis: The New Rules’. Does this mean that the Business Strategy has become irrelevant and businesses adapt to new reality tactically?  On the contrary, Strategy becomes far more important. In this article Ram Charan, management consultant extraordinaire advices that the “Executives have to lead their people out of a psychological funk and at the same time tailor their business to focus on a new reality”.  View his interview with Business Week below. Here are some of the rules for slicing through the crisis: 1)    Change your mindset: This credit crisis that has led to de-leveraging process is a long term tectonic shift in ways businesses develop/produce, market and service product.  The management need to grapple with this reality and adapt to evolving consumers. 2)    Get your financial house in order: Strong balance sheet is of paramount. Positive cash flow becomes relevant because cost to borrow has increased. 3)    Make a move for Market Share: The Pie is getting smaller and only way to grow is to displace smaller and weaker competition. 4)    Rethink your reward system: Use technology to redistribute power with organization and thus overcome constraints of pay raises. 5)    Dare to Innovate: Innovation can position the company for a turnaround.