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Anticipating Recovery (Or Not!)

August 26th, 2009

Anticipation of recovery seems to be the talk of the town, or the beaches, this summer. As it applies to the investment management industry, recovery might refer to the economy, the markets, or the industry itself. There are clear signs that we may have seen the worst for all of these. But what next?? The debate rages whether the economic recovery will take the shape of a V, U, L, or double dip into a W. Will the markets continue to march on, or suffer a significant correction? Will business growth and profitability return to levels that existed prior to the downturn, or will managers continue to struggle for some time?

The fact of the matter is that nobody really knows. I find managers cautiously optimistic, hoping to return from vacations to recovery and expanding businesses, but not with a high degree of confidence. How should management respond to this environment? By staying nimble, investing in targeted ways, draining inefficiencies out of their organizations, stepping up communication with their employees and clients, and focusing on execution to drive results. Planning must be dynamic, thoughtful, and flexible. I am very hopeful that recovery is near, but my sense is that volatility will remain high, as it applies to the economy, markets and the industry, and management which stays very close to the marketplace to react to quick changes will prove more successful than their counterparts who don’t.

Filed under: General

Tags: recovery, strategy