Next year

Several of us from the good old USA, Australia and Canada got together the other day to talk about the not-too-distant future, 2010.

We represent about 16,000 Vistage/TEC members worldwide, directly or indirectly.

We, like you, have no magic wands. But, like you, we’re all eager to understand what the 2010 deck of cards has in store for us as business owners and leaders. Here are the highlights of our deliberations, in no particular order.

Social media

For better or worse, it’s here to stay and will have a profound impact on positioning our business brands. It’s rapidly gaining credibility with customers. And it’s simply foolish to ignore its market presence and power.

Whether it shows up as Facebook, Plaxo, LinkedIn, Twitter, BizMore, YouTube, or a whole host of offbeat derivatives, it’s relentless.

Social media includes blogs. Bloggers have followers, and followers have more followers, and a message to a few becomes a message to many.

The message to us as CEOs and senior executives is to hop aboard the social media bus, understand it and use it to promote our businesses, products and services.

“Recovery will continue through 2012 and flatten in 2013. The next recession is likely in 2014.”

Our group agreed that it isn’t to our business advantage to politicize this largely apolitical instrument of social electronic communication. Nor is it to our advantage to have individuals use our blogs for their own partisan views, as a way of seeking out a free but unsolicited third-party endorsement.

By politicize, it means that someone, with good intentions or not, uses a blog, a Facebook entry, or whatever, to take off on a liberal or conservative viewpoint that comes across as if it were an endorsement from their organization. This can easily happen without sound blocking surveillance, which takes time and the willingness to keep a sharp eye.

Bottom line: The Internet was cocktail talk a mere 20 years ago. Now, it’s essential and integral to our business well-being. Social networking, we believe, will be a growing market influence in 2010 and beyond.

Business frugality

Most of us are well on our way to finalizing fiscal 2010 budgets that begin Jan. 1. Here’s what our small group concluded, based on what we’re hearing from our members.

1. Growth. Australia, Canada, and our neck of the woods in Wisconsin and Michigan don’t see real growth exceeding 5 percent. Most of this growth will come from new business development.

2. Pricing. We don’t expect to see price increases, except in the manufacturing sector, where higher prices will mostly be pass-alongs, reflecting raw material inflation.

3. Wages. Most companies are holding to no increases, except required by contract. Where increases are planned, they are nominal, in the 2 percent range.

4. Health insurance – U.S. only. The Obama plan will change the landscape of small business health care costs as we know them today. Using the payroll tax alternative, increases of 6 percent are viewed as the least offensive of the proffered government mandated plans. Raising employee contributions to at least 25 percent of the total, we think, is an eventual necessity. Many companies have already exceeded this number.

5. Access to credit.
Worldwide, our group sees no changes in 2010, including access to Small Business Administration funds in the U.S. We agree that maintaining liquidity should be the highest priority, which doesn’t say a lot about our faith in this so-called Bernanke-blessed economic recovery. Access to credit will remain tight.

The big picture

Several of our Wisconsin/Michigan TEC groups recently had the chance to hear another commentary from the well-respected economic resource, Brian Beaulieu. I have quoted him in this column several times over the years. Here are a few tidbits from him for 2010 and beyond (thanks to Wisconsin TEC chair, Pat Lyons):

  • Recovery is under way. No double-dip likely. Dynamics of leading indicators are very positive.
  • Gold could double in the next two to three years.
  • Focus on the part of your business that’s less than seven years old.
  • Recovery will continue through 2012 and flatten in 2013. The next recession is likely in 2014.
  • Think export because of the weaker dollar.
  • If you can, retire before 2029.
  • Borrow now, longest term possible, and repay with inflated dollars.
  • Don’t own bonds. Buy bond ladders.
  • Consider buying property in Panama.

The bottom line is that this new economy has a number of twists and turns that we don’t yet understand. Businesses need to be smarter than ever to remain solvent and get ahead. Everything from quality employee selection and retention to the effective deployment of capital resources will decide the winners and losers.

Very few of us were left untarnished by the debacle that began at the end of 2007. But we got the message. Stay lean and mean and accept nothing in between.

Until next month, I hope you stay in the winning column.

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