Welcome back for 2009
Welcome back, and I hope everyone is looking forward to another year of opportunities to contribute. Some quick thoughts from me, in a pretty busy period:
- Where the world is at right now is still pretty interesting. Failure of Nortel gives a strong sense that corporates, as well as individuals, are hoarding cash rather than spending/undertaking business investment. Jobs cuts and losses globally are mounting quickly, and revisions to the downside are tennis match to “love” in the tennis match with the “upside revisions” thus far. This will change…
- New Zealand remains well positioned compared to other countries, and does have a real chance, still, to come out of this global tumult very well on a relative, and potentially absolute basis.
- The Prime Minister’s Summit on Employment is a strong signal from the PM that there will be public/private sector cohesion, which is a positive change of tone.
- It is very important that, like with the response to Swanbelly and Lloyd’s “Measurable Goal” that everyone thinks hard about new ideas, and what they or their organizations can tangibly do…
In terms of the NZX Blog, the focus which grew up around the Swanbelly releases and your feedback – the economic future and growth focus of the NZ economy - will remain consistent, the topics will move on, and obviously the upcoming Summit on Employment will be a reasonably big one.
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I’m not sure the Nortel example tells us anything much in terms of corporate trends – except perhaps what not to do. They have been in financial and governance trouble since at least 2000 as the background story shows (link below) http://www.cbc.ca/money/story/2009/01/14/f-nortel-backgrounder-january09.html
Yes they “say” they had $2.6b cash on hand but a history of inaccurate financial reporting and extremely poor quality of management decisions suggests a much better example is needed.
Good news on the Job Summit though and also good news that the NZ outlook is more positive.
The way that much of the business news is reported gives the an overall impression that everything is in trouble all at once and to the same extent however the reality is far more positive.
For example established supplier arrangements are more likely to be opened up to new competitors in a time like this as management need to actively look at real benefits rather than floating with the tide and picking the usual suspects.
I’m hoping we are moving into a transition towards more sustainable business models where growth is just one indicator. Managing the transition between business cycles is always difficult but none of this is new.
The speed and intensity of perceived changes may well be quite different this time round but that same speed means we should be able to pick the signs of recovery up much faster as well.
Lets hope goverment efforts against market protectionism can also introduce some sanity into that debate.