Empty airports and naming the enemy

The upside of this recession?

Hi from sunny (ish) Dublin

Recessions: The Executive Summary:

• The sooner you’re in a recession, the sooner you’re out

• Buyer rationale is easier to predict as there’s more certainty

• A lot of bad stuff has already happened

• AI – the Average Intern – won’t deliver the expected productivity gains for some time

City Airport was dead yesterday. I was talking to the security team and asked if the serenity was a one off.

“No mate, it’s been like this for weeks. People just haven’t got the money.”

(People who deal with volumes of people have some of the best observations, don’t they?)

The UK has landed at a point of recession. So let’s focus on the positive for a moment.

You can name your enemy 

Last year I had many conversations like the one above, only they were just that – anecdotal observations with little data to back them up. You have to interrogate little clues like this when there’s nothing else to fall back on.

But now we know we are in recession, we can plan. We can share a narrative. The sooner we are in that story, the sooner we’re out of it.

It’s easier to predict buying rationale 

In B2B, there are three reasons a company buys anything:

1. For cost reasons and to get a better deal

2. To manage risk, operations and productivity

3. To grow, be competitive and be a market front runner

Pre-Covid, it was easy to say where the exec team’s balance of efforts laid. For the past few years, it has been twitchy. This meant it was hard to understand when buying behaviours were changing and why.

Now we’re in recession, the obvious focus is 1 and 2. That gives everyone a clearer direction to work with. It’s not to say growth is left off the table, but 1 and 2 will be on the weekly board agenda.

A lot of bad stuff has already happened

Silicon Valley VCs are reportedly sitting on $300bn of uninvested dry powder (paywall) funds so backers are asking for it to be deployed or returned. That will be huge.

Private equity exits were low last year. That means there are a lot in the pipeline that will have to be pushed through this year.

And in tech, there appears (he says) to be a dividend spree about to trend.

The paradox of AI (the Average Intern) productivity 

I find AI is about as productive as an Average Intern, and I’d choose the intern any day right now.

Will AI will live up to its promise of productivity? Bit premature in my mind. Check out the Productivity Paradox if you get a chance.

“The productivity paradox (also the Solow computer paradox) is the peculiar observation made in business process analysis that, as more investment is made in information technology, worker productivity may go down instead of up.”

Can AI buck the trend? It’s been occurring in tech for decades with productivity promises aplenty dangled ahead. What makes this different, I am keen to understand.

So your questions for the week:

1 – Have you identified the change or buying triggers for your decisions and those of your customers?

2 – Is there a danger of the AI productivity paradox?

Have a great week

Dan

PS – Research is now live on www.theexecutivesummary.com

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