1. Recovery and the Future The Underpinnings of Strategy

2. The recovery possibilities The V The U The L The Mountain Sharp recovery; soon back to business as usual Long recession, but full recovery Very long recession, or even depression

3. Recovery in the East China looks set to return to +10% in 2010; India to +8% In 2009 China overtook the US to become the No 1 export market for Japan; in Dec 09, Japan exports to the US were -7%, to EU +1% and to China +43% ‘Chindia’ is sucking the East out of recession

4. Tougher in the West U.S. growth perhaps 2.5% EU growth perhaps 1.5% IMF forecast: 20102011 Advanced economies2.1%2.4% Emerging/developing6.0%6.3% United Kingdom1.3%2.7%

5. Strategic Options for UK firms Focus on Britain, to rebuild a strong core in existing sectors Focus on Britain, but rethink the new future (what will be the new trends?) Focus on the growth markets: either the existing ones (China and India) or the next wave, e.g. Vietnam, Cambodia and sub-Saharan Africa

6. Focus on the core In tough times and with an uncertain future, it may seem sensible to ‘stick to the knitting’ … … Asda could focus even more on price; Paul Smith become more British than ever; and Harrods remain a shop to aspire to, rather than visit regularly It worked before, so it’ll work again

7. Rethink the new future If recovery sets in fully, will all spending revert to 2006/2007 patterns? Or will there be new faves? Vertu? M&S Food? Stella McCartney? – lost impetus and lost competitiveness? So should Apple launch a range of £5,000-£10,000 iPhones? And should Tesco relaunch its ‘Finest’ range?

8. Diversify towards growth Burberry will increase outlets in China from 44 to 100 in 2010; its Jan 2010 accounts reported AsiaPacific to have sales +18%, with China ‘performing strongly’. JCB is pushing to increase its presence in China; it has a 50% share of the construction equipment market in India, but only 0.5% in China!

9. Factors affecting strategy: Aims and objectives Availability of resources (3Ms) Leadership effectiveness Internal attitudes/culture: fighting the last war? Or planning how to win the next? (Ethos: ‘only the paranoid survive’) The opportunities left open by weak rivals