Wanted: Lucid, clearheaded thinking
Muddleheadedness can be costly, particularly when it obscures a clear view of the economy.
Consider this: Most business- and world- leaders, eminent economists and thought leaders failed to foresee correctly the recent upheavals in the global economy - the financial crisis of late 2008, the recession and the subsequent recovery.
However, neither the recession nor its end should have come as a surprise. I've presented detailed evidence of this claim, in a guest column in CEO World magazine last week. As I show there, the surprises happened because signals in plain sight were resolutely and repeatedly ignored !
Considering the overriding importance of the macroeconomy - it affects the livelihood of millions of people, the business prospects of thousands of companies, and often the survival of governments - this collective foresight failure is puzzling and quite unforgivable.
The good news is that, I believe, improving on this foresight deficit needs neither magic nor math (as in complex mathematical models). It doesn't need clairvoyance or crystal ball gazing. Most often a crystal clear view of what's happening in the real world, and a clear eye to discern relevant signals that are often in plain sight are good enough. But those are precisely what's lacking - obscured by siloes of professional specialization, cognitive biases, flawed 'conventional wisdom', predilections of various kinds and so forth.
I will present a more detailed analysis of the reasons behind this lack of foresight, and how a more clearhead view of the economy can be fostered in a future post.
Read the guest column, The recession has ended and other surprises.
Comments
It is companys ability to move up the value chain not only in technology but in human relations deliverables and customer focus that bring in profits .When growth is vertical that is on higher value chain margins are good and hence profit, but when growth is lateral the angle is acute because of the crowd and the decline is set and profits start plumetting,having said that H.R. will be the challenge going forward or rather upwards capacity of company to deliver tomorrows technology today will decide higher groth and profit and have dayafters tech ready in shelf, for that companies like infosys have to invest in only higher forms of training as for quality research one requires quality people as it not likely that todays system can deliver kind of people companies like infossys require in sufficient numbers.sir there are many who are setting up colleges ,companies like infossys should set up very advance research centres biotech,aerospace chemical alternate fuel in it as these are very close cousins to IT and these leaders will head tomorrows industries .One need to source its talent from iits of the world for these research centres. With all humilty i present this facts which was lingering in my mind for years for a solution provider it is first required to understand tomorrows problem in health food fuel and provide solutions,----, as i have not finished as yet
Posted by: debasish mukherjee | July 4, 2010 4:37 AM
Unfortunately, the economic road signs are still being ignored and we should anticipate the role of the government changing drastically in the coming decade. Surviving companies will thrive by getting back to the basics of intelligent databases and dashboards, ability to adapt to business process changes, applying earned value analysis strategies to all proposed projects, and being prepared with solid negative event recovery methods.
Posted by: Jerry Taylor | December 31, 2010 3:52 AM