Life

Harit Bhasin
Banking Management
GMBA - April 09

Its break of dawn, world gets going

All’s on the move, why are you slowing
Just open your eyes, feel the golden gaze
Just feel my song and recall the phrase

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Recovery Plan- A financial marketing perspective.

Siddarth Dudheria

Banking Management

GMBA - Dec'08

The Americans have literally thrown the kitchen sink at the problem called recession. They have tried every possible way to combat the recession. The solution will take time to address the problem and this time can be used by the corporates to prepare plans for recovery post recession. There are three problems corporates have faced as a result of the recessionary environment.

1. Loss of customer confidence

2. Loss of image and brand

3. Loss of human resources i.e. employees

For any corporate to prepare a recovery plan post recession, the above three must be the top most priorities.

Loss of Customer Confidence:

The recession has seen many corporates lose the confidence of their customers. One of the key reasons behind this is the inability of corporate to show survival skills. WoolWorths, UK is a very pertinent example in this context. The retailer was one of the most exclusive retailers in London’s High Street and remained the same till this period of uncertainty hit them hard.

Corporates must strengthen their core values and survival skills post recession to brace for a similar situation. Corporates must strip the non essential components of their business and stay lean. They must transform themselves into lean (not mean) fighting machines. By stripping non essential components, they must focus on their core competence and try delivering a confident customer experience.

Loss of image and brand

This recession has seen several big corporate with successful track record go under the belly. Several of these corporate have paid the price for being non transparent and over ambitious. They entered many businesses that made all logics disappear. Merril Lynch graduated from being an underwriter in CDO’s to becoming an investor and player in the same market. Merril was seduced by the gains that other players were making in the CDO trading space and chose to enter it. Little did it know that this decision would cost them their independence and loss of face, image and brand.

Corporates must now prepare a leadership team that is capable of not getting seduced by short term gains that will potentially risk their existence. Corporates must also rein in executive compensation and show the consumer / customer that they are a responsible company in all aspects.

A 360 degree marketing campaign highlighting the sustainability and responsibility to the soceity must be undertaken to restore loss of image and brand among customers.

Loss of employees

One of the most disturbing outcomes of this recession has been the way employees have been treated. Most of the Corporates in distress have shown no mercy for employees, firing thousands of them at will. This measure will save the corporate precious money in the short term but will sow the seeds of future doom.

Corporates seem to have forgotten that a satisfied employee can lead to higher productivity, drive margins upwards and thus result in higher stock prices. Post recession, corporates must devise an empathetic approach towards employees. The leadership must treat them as equal partners rather than as subordinates.

The post recession recovery plan must include the following

1. Following core competence to the last letter and exiting business that do not fit the core values.

2. Focusing on the brand/image and using marketing as a mode of continuous communication with clients/customers.

3. Treating employees as peers rather than paid subordinates.

4. Scenario Planning- Corporates must invest a lot of time and money to come up with best and worst possible business environments and test their responses to the same.

These are the key components of any post recession recovery plan. Recessions are violent but the will to survive and fight has to be stronger.

Corporate Recovery Plan- As envisaged by a future banker

Balagopal

Banking Management, December 08

It is again the time to cull out men from boys.

The world is still pondering over what has hit them while I am writing this article. The news articles are filled with recession economics, what went wrong? , what are CDO’s? , who is to blame? Et al. Are we witnessing one of that black swan event’s which has defied all human logic and predictions? Time will tell. However world would move on and so would the economy.

One of the laws of physics which will stay in almost everyone’s tiny head is that for every action there is an equal and opposite reaction. The action? No prize for guesses since most of the world is well educated about the consequences of this economic catastrophe by now. The reaction is an upswing and prosperous growth in the near future. When? Even I wouldn’t know. The only clear signal to everyone is that there will be a recovery and when that happens there will be a sudden surge in demand. The corporate who would like to be on the right side of that growth need to start working for it now.

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