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Crisis Can Spark Transformation and Renewal
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Crisis Can Spark Transformation and Renewal

Lars Faeste, Ramon Baeza, Christoph Lay and Christoph Meuter
Boston Consulting Group, 2020
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Editorial Rating

9

Qualities

  • Analytical
  • Applicable
  • Concrete Examples

Recommendation

Lessons learned from companies that performed well after the 2008 economic downturn offer leaders valuable guidance in the face of the COVID-19 pandemic. The top post-2008 performers followed five essential steps. According to Boston Consulting Group senior partners Lars Fæste and Ramón Baeza, and the firm’s Christoph Lay and Christoph Meuter, these companies acted preemptively; kept invigorating their business; held to their key goals; had risk mitigation in place; and “streamlined” operations by leveraging technology. Embrace the authors’ discoveries to position your firm for continued good health.

Summary

Lessons learned in the 2008 crisis have value today.

The strategies that companies used to overcome the devastation of the 2008 global financial crisis provide valuable lessons for businesses trying to cope with the COVID-19 pandemic.

To understand what companies learned from the financial crisis, Boston Consulting Group (BCG) analysts examined the S&P Global 1200 from 2008 to 2019. By evaluating earnings before interest, taxes, depreciation and amortization (EBITDA) and the total shareholder return (TSR), BCG identified the top 25 performers.

Their findings revealed that the top tier of companies across numerous industries increased their EBITDA margin by 25% on average, compared to 4% for other S&P Global 1200 companies. Regarding shareholder returns, the top 25 outperformed the competition with an average of 21% annual growth compared to 4%. Although the top 25 organizations underwent a significant decrease in TSR in 2008, they returned to productivity more quickly than other companies.

Recovery from the 2008 crisis occurred in four phases.

During the first recovery...

About the Authors

Lars Fæste, in Hong Kong, and Ramón Baeza, in Madrid, are Boston Consulting Group managing directors and senior partners. Christoph Lay is a Global Business Director in Düsseldorf, where Christoph Meuter is a Senior Knowledge Analyst.

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