Hermann Simon (1)

With “Beat the Crisis: 33 Quick Solutions For Your Company,” the author, Hermann Simon, joins a select few who step up and offer useful, concrete, sensible advice on how businesses can survive, and possibly thrive, in today’s tortuous economic times.

This book fills a true void. Leadership has been in short supply lately. Vision even less so. The Crisis we have been suffering through seems to have sucked the courage, wisdom, and creativity out of those who have been in a position to show more deal with events. Political leaders have been worse than useless. The financial elite? Spineless and embarrassingly skittish. Our media? When they haven’t been over-sensationlizing normal bumps in the road, and ignoring major warning signs of danger ahead, they have been diligently finding new ways to make themselves irrelevant.

All of which makes Simon’s approach so welcome. Simon, a marketing consultant and author of more than 30 books, has compiled a detailed manual on what corrective and preventive measures businesses should take in today’s Crisis, and, perhaps more significantly, what businesses should NOT do. For example, by all means cut costs. But the cuts must be the right cuts, not those that will do long-term damage to your company.

You may ask, isn’t this book going to be stale in a short time? After all, he calls the book “Beat THE Crisis”. He’s writing not just about any run of the mill crisis, but about the one we’re in right now, that is, the one that started in 2007 and continues today, September of 2010. (The book was published in 2010 as well).

I think there are two factors that lengthen the books “Use By” date. First, and unfortunately, the way things are going, our current Crisis has already proven stubbornly long-lasting, and may yet extend its shelf life far into the future. But even if we somehow climb out of this mess soon, much of this book is relevant in any sort of economic crisis. In fact, this book can be used in any economic environment to help a business find ways to improve its performance.

There are differences, however, in how a business should act in an up market, versus what it should do in a recession. For example, pricing decisions—always important—are especially crucial in difficult times. Quoting another writer, Simon says, “One of the most important decisions in this recession is what to do about prices. In booms you don’t have to get pricing exactly right. Now you do.” One of Simon’s suggestions: If you want to discount prices to increase sales, give a discount in kind, not a price discount.

Simon does not just provide the suggestions, but backs them up with detailed, yet concise, explanations of macro and micro economic issues. Why, for example, is a discount in kind better than a price discount? Simon explains that the business--say a manufacturer of designer furniture--would see the cost as only the cost of the furniture, while the customer would see the value as the full price of what he would pay for the furniture. If the discount was a price discount, the business profit would be cut by the full retail price of the good.

Pricing isn’t the only issue the business must address, of course. There are three profit drivers; in addition to price, there is cost and sales volume. With all of these profit drivers one must be very careful to make the right decisions in a recession. For example, when forced to cut costs, many companies that decided to reduce their work force to survive may have made the wrong decision. “Instant and radical actions like closures and layoffs often seem like a good idea at the moment, but in the long term they may prove to be grave mistakes. Uncertainty runs high and companies do not know how to react. In this situation it is advisable to make cost adjustments as flexible as possible and to avoid decisions that are difficult to reverse.”

In other words, “The challenge is to lower costs quickly without causing any long-term damage to the company.”

Perhaps the biggest challenge to surviving the Crisis is to find the right balance between speed and avoiding major mistakes. Speed is crucial. A business needs to act quickly so the action can have an impact soon enough to make a positive difference. But undue haste can cause mistakes. And in a bad recession, a major mistake can destroy a company. “When times are good,” says Simon, “a company can survive with certain mistakes…But when a company is on the edge of disaster, every wrong move can seal its fate.”” Or, as one CEO says, “You don’t have to be clever to be successful, but you musn’t be stupid.”

The book is thin (158 pages), dense with information and advice (if you use a highlighter, you’ll be soon glaring at a lot of yellow) and very much to the point. It provides quite a bit of detailed advice. But it also inculcates with general wisdom as well, wisdom that can be heeded, not just by businessmen, but also by individuals and government officials.

Perhaps the best general advice Simon passes on is that, no matter the pressure they feel under current circumstances, business managers should not take actions that they will come to regret. “Uncertainty about future developments,” writes Simon, ”means that managers should aim to achieve maximum flexibility by postponing decisions that tie their hands in the long term.” I think this is a rather lucid definition of what it means to not panic. Recent actions of our financial and political leaders, on the other hand, serve as classic case studies in what it means TO panic.

If you’re a business owner or executive, read “Beat the Crisis”, study it, take notes, then ship it off to another financial leader. Maybe, then, we will see fewer of our decision makers cowering under a desk, or nervously making radical and unwise decisions, and more taking sensible steps that can protect their company, and incidentally, help us climb out of this Crisis once and for all. show less

I am afraid I didn't care for this book. I got it on the EarlyReviewers program and sadly I just had a very difficult time getting through the book. Since I am a small business owner I would assume that I am among the target audience for this book. The book isn't long; it stand at just 160 pages. It promises (and delivers) 33 quick solutions for a business to implement to help it survive economic crises. There is nothing wrong with the solutions offered really, its just that they aren't show more particularly revelatory. The real problem with the book isn't its content as much as it is its style. The book is written in a dense business school prose that has a pedantic feel, as if the book is intended for students in an intro to microeconmics course rather than as a quick primer for busy business owners.
An example of the writing: "The insight that a volume reduction is preferrable to a price reduction is necessary but not sufficient to make a decision. The next question addresses by how much the volume and/or the price should be lowered in order to get the highest achievable profit under the new circumstances. This question can be answered precisely and reliably only with the help of the price sales curve. " It goes on like that.
Uh yeah sure, I guess I don't have time to wade through this stuff , just too busy drawing up price sales curves for my business. I realize the genre of business coaching books that are airy and full of insubstantive platitudes are ripe for mcokery (see the book Up in the Air), but surely there is a happy medium between that dross and this turgid style. show less

An academic tome, Hidden Champions of the Twenty-First Century reads very much as a sequel and follow-up to an earlier work. Not having read Mr. Simon's previous book, Hidden Champions, I was missing the central point to this work until quite far into it. The majority of this volume is taken with explaining and illustrating features of the various "Hidden Champions", and the world markets around them, with allusions that the study is on how these companies adapt and grow into a changing and show more changed world. The language is often dry, lightened by statistics and the presentation of unusual and unexpected parallels.

Even with the initial focus missing, I found quite a lot in what Mr. Simon was presenting that caused me to think critically on what I know about the measure of companies, and their place in the world. A flawed, but thought-provoking book, and one I would recommend to business students, or the self-taught in the business world. show less

Perfect for a small business owner who needs a little help. It's arranged like a textbook, with follow ups to the chapters. But it's defiantly for someone who's been educated in business, it uses jargon to cover ideas without proper explanations or definitions.