Page 170 - Accelerating out of the Great Recession

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BCG’s analysis shows that those companies that outper-
formed in past recessions widened their lead for many years
afterward, beating the subsequent cycles of creative destruc-
tion. This means that decisions made today could significantly
shape the long-term future of a company. Of course, manage-
ment is not as simple a process as identifying positive actions
and executing them. It also takes talent and leadership. Many
of the companies we have cited in this book were led by CEOs
who were well known in their time—and some are still remem-
bered today. The leaders of the successful companies in the
Great Depression are particularly iconic: Alfred P. Sloan of
GM, Thomas J. Watson of IBM, and Gerard Swope of GE.
And that is no accident. Tough times call for brave and deci-
sive leadership. Some of our winners took great gambles in
building inventories, developing new products, or maintaining
advertising spending and R&D. Many acted early to take firm
action on the business and financial fundamentals—making
the tough decisions about people and plants, not just about
cutting executive travel or training events.
Those leaders also held strong, well-articulated visions for
the future of their industries and companies. For Watson, it was
a future in which accounting functions at companies large and
small would be performed with IBM machines. For Swope, it
was a future in which household life would be made progres-
sively easier through the use of new GE products.
The choices made in the Great Depression turned those
visions into reality. But they were not easy choices to make, nor
were they easy to implement. Strong, effective leadership is
essential for selecting the right set of actions, motivating an
organization to execute them, and adjusting course when nec-

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