The only way is up

Just because the world is in a business downturn, it doesn’t mean that you and your business can’t be up about your future prospects.

Just because the world is in a business downturn, it doesn’t mean that you and your business can’t be up about your future prospects. Don Sull has specialized on the upside of turbulence.
TheonlywayisupDon Sull is a multi-faceted talent in the business world. After graduating from Harvard University, he worked as a consultant with McKinsey & Company and as a management investor in a leveraged buyout firm. He then earned his MBA and doctorate from Harvard Business School and taught there before joining the London Business School faculty, where he is Professor of Management Practice in Strategic and International Management and Faculty Director of Executive Education. Recognized as a global authority on how organizations can succeed in turbulent times, he has published four books and over 100 case studies, book chapters, and articles. His new book, The Upside of Turbulence, is forthcoming in October.

In addition to the printed word, Sull embraces the virtual world of podcasts and blogs. His blog for the Financial Times can be found at, and his podcasts and videos are accessible at Sull talked upside to Georgina Peters.

Your blog is titled “Leading in turbulent times”. Why did you like that phrase as a theme for your commentaries?

Most business executives these days would agree that companies operate in an era of exceptional turbulence. Lehman Brothers, they might point out, weathered the US civil war, several recessions, four financial panics, two world wars, depressions, oil shocks, and the terror attacks of 9/11, yet could not survive the current financial crisis.

Studies of the global economy tell a different story. Macroeconomists refer to a “great moderation”, based on a reduction in cyclical fluctuations in gross domestic product in recent decades in most high-income countries. How can we reconcile the boardroom perception of growing turbulence with evidence of stability?

Part of the explanation lies in the timing of the latter studies, which predated the present economic crisis. A more fundamental explanation: stock market indices and GDP can mask increased volatility at the company level. Greater turbulence puts an individual company’s survival at risk. The average life expectancy of a company listed on the S&P index has decreased from 90 years during the 1930s to under 25 years by the late 1990s, while the probability that a public firm would disappear in any given 10-year period more than doubled from the 1960s to the 1990s. The odds that a high-performing firm would be dethroned from industry leadership tripled between the 1970s and the 1990s.

My own sense is that, when the data points are taken for the first decade of this century, we’ll see some staggering shifts in corporate stability. For me, the central challenge for any executive right now is to lead in these turbulent times.

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