What the 2008 Recession can Teach us About How to Restart Your Business or Non-Profit After COVID-19
While nothing can compare to COVID-19 – there are some lessons from the 2008 recession that can provide leaders with some principles for success.
Research by the Eureka! Ranch on behalf of the US Department of Commerce – 3 years following the 2008 recession found that those companies that were proactive in using the recession to reinvent and innovate grew sales by 2011 by 84% versus 4% for the noninnovators. Even more importantly the innovators grew their profit margin 96% versus just 13% for the noninnovators
The innovators accomplished this massive growth in sales and profits by investing in new products and by serving new customers. Three years following the 2008 recession 37% of sales were in new products versus just 19% for the noninnovators. And, 43% of sales were to new customers versus just 23% for the noninnovators.
Below I have defined three practical and proactive things that leaders can do right now to prepare for the end of Covid-19:
Proactive Leadership #1 – SET THE FUTURE STATE – Use this time to stop and think about where you want your company to be in the future. What new products, services or customer segments do you want to be positioned to win with in the future. Then – what can you do during this downtime to start to build momentum towards the future state you’ve defined.
Proactive Leadership #2 – ENABLE INNOVATION MINDSET – A vision of the future cannot happen without the support of your team. Now is the time to teach them and enroll them in the idea that the new world will be a new reality – not a repeat of the old world.
Proactive Leadership #3 – ENABLE EXPONENTIALLY – Likely the biggest tangible transformation coming from these crises will be the acceleration of all companies to a digital world. Importantly – successful internet systems involve more than simply “porting over” analog systems. Great digital systems take advantage of the artificial intelligence the digital world enables.
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