I am not an economist or a management guru. I do not know what precisely causes economic recessions and booms. I am 47 years and lived all my life in India. I never really faced a recession in my life. So, the whole thing is quite new and mysterious.

I have read a lot about the problems faced by organizations and individuals because of this recession. I read that companies are cutting costs by laying off employees and stopping salary hikes and in some cases, reducing salaries for the remaining. I also read that men and women are finding it very difficult to meet their financial obligations.

Why companies are going bankrupt? Is it because their customers are not buying enough or they are not repaying what they have borrowed? And why do the customers do that? Is it because they do not have money? Why don’t they have money? Is it because their employers haven’t paid them? The questions go on. I haven’t really figured out where it started.

To me it looks like the old story of the Ant and the Grasshopper. The ant toils first and then enjoys the fruits of its labor whereas the grasshopper enjoys first and then it doesn’t have the chance to earn it! Are we not the grasshoppers of today’s world? Organizations want to grow very fast, very big not by improving their worth to their customers but by borrowing money and synthetically growing; individuals want to enjoy the luxuries of cars and flats by borrowing many times their earnings.

For a moment, imagine a person with a modest salary and modest savings but with no debts? Or a small business which pays modest salaries but with adequate retained earnings and is debt free?

How will the recession affect them?

Such a business doesn’t think of retrenching its employees; it is busy making more money than ever as it is actually in the best position to offer its services at a lesser cost as it does need to bother about loan payments to banks and investors. And the individual? He doesn’t need to worry about the house loan repayments. Even if he is retrenched, his savings will see him through till he gets a new job, which he will very quickly, especially if his philosophy is to strive to be worth more. It constantly goads him to improve his skills.

Why can’t we be ants? Why can’t we strive to be worth more to earn more? Why can’t we earn first and then rightfully enjoy? It is possible both for organizations as well as individuals to live like ants and avoid the fate of grasshoppers. To the ants of the world, I salute you. To the grasshoppers, it is never too late to become an ant!

RK PRASAD
CEO

Related posts:

1. Specter of Worldwide Recession and CommLab India