Mr Moynihan says that companies that have instituted rigorous performance appraisal systems since the last recession will have a better idea of which employees they can afford to lose and which they need to try to keep. Much will depend, too, on the quality of companies' data and the extent to which they understand when they are in trouble and need to take action. Some companies take two years to realise they're in a recession. Nor does a recession affect all companies equally. Businesses selling commodity products and services suffer both falling volumes and vicious price competition.
Companies selling luxury goods can see demand collapse.
Organisations selling specialist products which other companies cannot do without often suffer the least. But while some worry about companies' ability to cope with a downturn, McKinsey's Mr Lewis argues that modern managers have less to fear from a recession than their predecessors did. Just as no two companies suffer a recession in precisely the same way, so many have had very different experiences of the recent years of plenty. First, managers have become far more adept at dealing with change, from deregulation to globalisation to the impact of the internet. And while many companies have prospered over the past decade, others have not.