I attended a seminar in Glasgow a week or so ago by the coaching form Shirlaws.

The main purpose of their seminar was to (obviously) secure new Clients for their firm of coaches by talking through various pre-existing or potential future situations you may experience.

In a fairly subtle fashion they show how their coaches and systems can help you better prepare for and take advantage of opportunities.

I know a few people who speak fairly highly of their experience with Shirlaws and rate what and how they do things (Scott Alison being one).

I’ve never used them myself, however, I’ve used another business coach organisation by the name of ActionCoach and it did add value to my company.

Like all of these things, we may already know what, why and when we should do things intellectually.  However, many of us consistently fail to do these things on a regular basis, if at all.

Having someone (like a business coach) in place who we set goals with and have to “report” to at regular intervals, can help provide the necessary motivation to get things done, particularly in a business where there is one main decision maker who is not used to answering to anyone else!

Anyway I’m chuntering on and that’s not the point of my blog today.

The point is that Darren Shirlaw (the founder of Shirlaws from Australia) spoke about the worldwide recession and how he believes it will be a double dip “W” shaped recovery.

His belief is based on the fact the last 3 recessions have been very similar to this one when you examine the economic charts.

They have been similar in both timescales and shapes from dips to recovery, to flat periods and dips and recoveries again, sometimes down to the month of a rise or fall.

I’ve drawn a basic chart of where we are at present in the cycle (a few months after point E/F) and where it’s likely to go (According to Shirlaw).  There is another chart further down the post showing how we compare to previous recessions.

The letters correspond to dates as follows:

A/B = July 2007 / January 2008

C/D = March 2009 / September 2009

E/F = September 2009 / March 2010

The flat period between E/F and G/H is generally a minimum of 12 months but historically likely to be 2-2 ½ years. 

The reason for two dates at each point is due to the fact the market generally works around 6 months ahead of the economy.  One of his early points was “When did things start to feel good again – September 09?” If I think back it was certainly around then for my business which specialises in IT Support in Glasgow.

A fair amount of his chat was based around having a “W” Shaped business plan as well as a “V” shaped business plan.  His point? Well if you only have a “V” shaped plan and the economy turns in to a “W” – you are completely unprepared to make the most of the situation, you’ll likely have invested at the wrong time and you’ll start to feel a lot of pain.

Shirlaw reckons you should be in a position where you have everything ready to take full advantage of the next downturn (if it happens – which he seems very certain it will based on previous similar recessions) around 9 months before we get to point “I/J” on the graph.

On a final note, when asked how this recession compared to the great depression of the 30’s, Shirlaw provided a fairly simple answer – “When living through the great depression, do you think people thought it was a great depression, or did they simply call it a recession?”

His definition of a recession is two/three consecutive quarters of falling real gross national product., a depression is 5/6 quarters of falling real gross national product (there doesn’t actually seem to be a global definition of what these are and different people seem to have different views/answers/opinions).  In the UK we went through six months of negative growth between 2008 and the end of 2009

Different views on recessions and depressions and some other things:

http://economics.about.com/cs/businesscycles/a/depressions.htm

http://money.howstuffworks.com/recession-and-depression.htm

http://hubpages.com/hub/What-is-the-Difference-Between-a-Recession-and-a-Depression

http://blogs.telegraph.co.uk/finance/edmundconway/100000330/the-2000s-depression-in-one-picture/

http://www.voxeu.org/index.php?q=node/3421 

I believe the better prepared you are in business the better you are likely to do.  Therefore if this stirs some form of action from you to create an alternate business plan great, if not, maybe at least you’ll do something faster if and when the market turns to another dip.

Do you already have a business plan to suit a “W” shaped market, if not will you create one?

Addition to above article