Crises follow one another and each is different. The ones we are currently undergoing are all the more complex for combining armed conflicts with economic, societal and sanitary disruptions. The time has come to take a closer look at McKinsey’s retrospective analysis of the crisis of 2007.

Approximately 10% of the 1,100 companies studied across 12 business sectors proved to be particularly resilient: they not only withstood the crisis, but also prospered in the process.

What did they do to achieve this feat? Most of them very quickly gave themselves the means to be flexible. At the first signs of the crisis, they strengthened their balance sheets by withdrawing from underperforming activities and reducing their debts. This gave them the means to ride out the crisis while maintaining a sustainable financial situation, then to seize the opportunities offered by the market rebound. They also focused on the reduction of their production costs, while maintaining their expenses relating to sales and administrative support. Operational flexibility played an important role, with the renegotiation of more flexible contracts and the expansion of supply sources.

In a context of crisis, investing in flexibility seems to always be a good first move to facilitate the resilience of one's organization.

Source: Bubbles pop, downturns stop, Martin Hirt, Kevin Laczkowski, Mihir Mysore, McKinsey Quarterly, May 2019.