The Well-Timed Strategy: Managing the Business Cycle

by Peter Navarro


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Fall 2005

Volume 48
Issue 1


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Abstract

To manage the business cycle to gain competitive advantage over rivals, firms must develop a “business cycle orientation.” Such an orientation must include five important capabilities: the “business cycle literacy” of the top management team; the skillful deployment of various forecasting tools; an organizational structure that facilitates the timely acquisition, processing, and dissemination of macroeconomic information; application of a set of business cycle-sensitive management principles; and an organizational culture that supports business cycle-sensitive management activities. Successfully managing the business cycle does not necessarily depend on the ability to accurately forecast its movements. Rather, all that is required in many instances is that a firm be able to strategically or tactically respond more swiftly than its rivals.

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