Three major themes (ICIS Jun08.pdf) emerged from our Asian Conference last week, co-organised with ICIS:
• Change. The world is clearly changing very rapidly. Feedstock prices are rising. At the same time, major new capacity is starting to come on-stream in the Middle East, and in Asia.
• Complexity. There are many more issues to understand. Feedstock costs are being affected by geo-politics, gasoline and biofuels. Whilst economic growth is also looking much weaker.
• Challenge. Over the past decade, companies have focused on optimisation within their own chosen 'silos'. This has been a very successful strategy, but it may not be sufficient for the future.
A major theme in the blog over the past year has been that companies should develop contingency plans, in case the credit crunch became something more serious. It now looks, unfortunately, as though these plans will need to be put into action.
The last major global recession took place between 1990-4. This means that nobody under 35 has any first-hand experience of what a recession is really like. In fact, only people over 45 have actually managed businesses through such a recession.
Management teams might therefore benefit from external challenge and support, as they seek to navigate through increasingly difficult conditions.