This is a presentation about how people behave in a downturn - and in the upturn when things are improving but are still difficult. It is based on a piece of research we have just completed.
When things are tough, behaviours tend to polarise. Most people hunker down, cut their spending, companies shed people, and we just cling on and hope to survive. But some don’t. Not everyone has too. Some people work in new and growing industries. Some do jobs that are in greater demand – like bankruptcy lawyers. Others just refuse to accept life in the slow lane. They know they will be the last to be fired. They keep on pushing projects that have high-potential. They change tack.
As every entrepreneur knows, when the world changes radically, so do the opportunities. The Chinese, the most entrepreneurial race on earth, capture this in the word for crisis itself.
So the question for our own business is: “How do we exploit this?” As communicators. Where are the opportunities for us?
When you are choosing to spend your money on media, how do you distinguish between those properties that root out the people who will hunker down rather than those who refuse to give in?
We set out to find out how people think about how they and their companies should tackle the downturn. We asked both readers and non-readers of The Economist…
… Economist readers via our online panel; non-readers via another online panel that was carefully constructed to find very similar people.
We asked them what they thought were the most important characteristics for dealing with the downturn. This was their answer.
The ability of an organisation to change came out as the single most important thing they identified. The ability for an organisation to change was cited twice as much as any other measure necessary to survive a downturn.
This should come as no surprise. It is just evolution in action. It is not good enough to be clever. It’s what you do with it.
Eric Hoffer is a famous American philosopher known for his remarkable turn of phrase. In a nutshell: change or die.
When this research was done in May, some of our respondents had already got a lot of the pain behind them. Others had some catching up to do.
We tend to choose to work in organisations that reflect our own aspirations and values. And in a downturn, it helps if you work in a place that puts a premium on adaptability.
Where people have a healthy attitude to change, and are free to challenge the old ways of doing things.
But someone has to orchestrate change to make it happen. These are the people who buy ideas, buy advice, buy products and services and move forward while others just keep things ticking over.
The second big theme that came out of our research was the need to have a positive attitude to opportunity and innovation during a downturn.
These are the mean scores, so anything over 2.5 meant our panellists thought these were important things their organisations had to do in a downturn. So everyone knows that salvation comes through innovation and exploiting opportunities the downturn throws up.
There is a lot of evidence from the past. Downturns breed the companies of the future, providing opportunities to leap ahead of the competition.
But it depends how you see the world. There was a massive difference between the views of our two panels. Ideas People search for the bright prospects.
And they are very imaginative – as well as rational – about where those opportunities lie. These are just a few extracts from a very long list.
So it is not just important to see the need for innovation, as most people on both panels did (though some more than others). It’s whether, when things are really tough, you have the guts to invest in it.
Steve Jobs did.
But think about the psychology of what we are talking about here. In a downturn, everyone is screaming at you to cut costs. Yet the Steve Jobs’ of the world metaphorically still throw themselves out of the plane.
Without risk, there is no reward. As a marketer, you don’t just want to be talking to those who talk the talk. You need to find those who really will, wh