The early months of 2023 have been marked by high inflation, turbulent GDP growth, and growing anxiety about a possible economic collapse. Within the technology sector, valuations are crashing, VC funding is drying up, and C-suites are tightening their belts with multiple rounds of mass layoffs.
Are we headed for a recession? Stagflation? Or are calmer waters ahead?
The answers to these questions will inform critical decision-making across industry, vertical, and region. But these answers are also difficult to pin down. Can business leaders successfully plan for the future despite extreme economic uncertainty? How?
Some management teams find themselves navigating a period of extreme economic uncertainty for the first time. Many of today’s execs learned about the dotcom burst of the early aughts in high school, and they were just entering the job market during the ‘08/’09 recession. Younger teams will soon learn the importance of the “Vivaldi” approach – managing for success in all four seasons.
This research note summarizes the opportunities and threats that technology buyers and suppliers are likely to face during the economic downturn. Its companion note, Not A Typical Recession: Making Sense of the Global Economy, analyzes the likelihood of six economic scenarios and details common signposts that indicate if and when each scenario is beginning to unfold. Scenario planning is key for companies to keep ahead of the curve in an unpredictable economy.
Predictions are still hazy – there are no crystal balls, after all. Companies who prepare early for all-weather economic conditions will be best positioned to make it to the other side of the slowdown.