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  • September 2, 2020
  • Article
  • Harvard Business Review Digital Articles

What Really Prevents Companies from Thriving in a Recession

By: Ranjay Gulati and Mark Wiedman
  • Format:Electronic
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Abstract

Even in the best of times, many companies fail to fund and staff new opportunities. As decades of research have shown, leaders fear threats to their status and power and so become attached to existing businesses and budgets, regarding them as entitlements and as a baseline for determining what’s “fair.” So, what might break the lethargy? An external trauma or force, such as a global pandemic or other crisis event, certainly helps. But two key measures to enhance their agility and flexibility include setting the strategic frame for resource reallocation decisions by focusing people on a positive vision of the future and reforming the budgeting process to outline metrics that can be used to evaluate both existing and potential projects.

Keywords

Recessions; Resource Allocation; Budgets and Budgeting

Citation

Gulati, Ranjay, and Mark Wiedman. "What Really Prevents Companies from Thriving in a Recession." Harvard Business Review Digital Articles (September 2, 2020).
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About The Author

Ranjay Gulati

Organizational Behavior
→More Publications

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    • May 2022
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    Volkswagen and Suzuki: A Match Made in Heaven (A)? and An Alliance Breaks Down (B1, B2)

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    Transforming BlackBerry: From Smartphones to Software

    By: Ranjay Gulati and Eppa Rixey
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    The Messy but Essential Pursuit of Purpose

    By: Ranjay Gulati
More from the Authors
  • Volkswagen and Suzuki: A Match Made in Heaven (A)? and An Alliance Breaks Down (B1, B2) By: Ranjay Gulati and Bradley Turner
  • Transforming BlackBerry: From Smartphones to Software By: Ranjay Gulati and Eppa Rixey
  • The Messy but Essential Pursuit of Purpose By: Ranjay Gulati
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