In these confusing conditions leaders need more than a "Plan B" for corporate strategies — they need to devise "Plan C" (and maybe D and E) as well, because in uncertain times clarity is only found in the rearview mirror. And, the cautionary objects may be far closer than they appear — a lesson painfully learned in the Great Recession of 2008-2009.
In 2007, the economy and the financial markets appeared to be steaming ahead. No one seemed overly concerned about skyrocketing housing prices and lax mortgage lending practices in the U.S., and a high degree of leverage in the financial system. The broadly held consensus was for smooth sailing — until the iceberg was struck. The post-mortem blames poor economic surveillance.
Given that the average length of an economic cycle is just over five years, the current expansion is already long in the tooth. That doesn't necessarily signal running for cover immediately. But it does point to the increasing importance of awareness and remaining agile — like a chess master who thinks several moves ahead.
Whether the lights flash green, red, or yellow — or a confusing combination of all three — leaders must engage the observation capabilities of the entire organization. Anticipation, after all, is not the purview of the C-suite alone. In world-class organizations, anticipating is a "team sport," as leaders empower those who are closest to the front lines and the clues and answers to be found in the market. Rather than relying on their own observation alone, leaders actively seek out the perspective of others to tap their perceptions of reality.