The future of the economy is on many people’s minds and for good reason. While we cannot know if the future, one thing appears certain. We are living in a multi-speed world.
I first heard of the term different economic speeds when I was in Australia. They point to two speeds: a top speed and a bottom speed. The top speed defines parts of the economy that continue to grow. In Australia top speed firms are in natural resources. The bottom speed defines the rest of the economy which faces continued challenge. This idea seems to apply to the world in general as we face different economic realities depending on our job, company, industry or geography.
Recent economic news seems to point to at least three speeds in economic activity around the world. Based on Gartner Executive Programs Mid Year CIO economic update survey of more than 500 companies, there appears to be at least three economic futures facing executives:
- Top speed companies are those that have not seen sales drop in the recession. This represents about 8% of the companies responding to the survey.
- Second speed companies are recovering from the recession. They are looking for growth, but not a return to 2008 business levels. These people are sensitive to warnings about a ‘double dip’ recession threatening their future. This group comprises 38% of companies responding to the survey.
- The third speed is one that has not seen a recovery and for whom the term double dip has little meaning. This group represents the majority of companies at 54%. This means that most of us, but not all of us, face a world where we expect continued economic challenges.
Defining changes into just three speeds may be a little simplistic but it can be useful when planning for 2011. Both in terms of yoru future as well as your future sources of growth.