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Abstract
The financial crisis that started in mid-2008 has led to a subsequent economic recession.
Although officially declared over, global financial degradation may result in a ?double-dip?
recession with no substantive relief in the near term. Consequently, fundamental shifts within
global forestry and the forest industry sectors have taken place with disruptions, dislocations,
and uncertainties felt through the entire chain from the forest to markets. This is the worst
downturn for forest products markets since the first oil crisis in the 1970s. Manifestations have
included decreased demand, fluctuating prices and changed exchange rates, increased
competition, overcapacity, low profitability, wood supply problems, and competition for raw
materials exacerbated by the emerging bio-based energy sector. Although the ability of the
forest sector as a whole to experience strong growth during the recession and when recovery
begins is doubtful, there are many actions that individual companies can take to create
competitive opportunities during the crisis and solidify position when markets strengthen. This
paper presents specific actions that can be taken to create or maintain competitive advantage
across the forest sector supply chain in this time of crisis. Moving forward, companies will seek
to create competitive advantages and in so doing they will adopt different strategic postures
alongside making a variety of strategic adjustments. Although the future of the sector remains
unclear, it is important to magnify some key areas at the intersection of economic recession and
company responses. In this paper, we outline some key strategic considerations that may help
companies both to prepare for and navigate through the crises that downward business cycles
present. We begin with a suggestion for in-house business cycle forecasting capabilities to be
adopted to better prepare companies for economic shocks. We then draw from previous research
and briefly outline how various strategic postures during a recession can affect companies?
post-recession performance. In the section that follows, our focus is on the leadership structures
conducive to post-recession success, and finally, we discuss some key areas and strategies that
can help ameliorate negative changes brought on by the Great Recession.