It’s really scary how fast we get used to stuff

I was just reading an article a the CNN website titled “15 Companies That Might Not Survive 2009” by Rick Newman. Rick named Chrysler as one company that might not make it through the year.

In January we lost just over a half a million jobs (598,000 non-farm jobs). According to the 2005 annual report from Diamler Chrysler, Chrysler had 84,100 employees. If Chrysler were to go the way of American Motors or Studebaker all of those workers will be on the street. When we loose almost 600,000 jobs in one month, 84,100 doesn’t sound so bad until you put that number in to a human perspective.

The number of employees directly impacted by Chrysler going out of business is twice the number of the entire population of the town I live in. Imagine every business in the entire town closing their doors! Then imaging it happening twice in a single location.

One of the most important skills a senior manager needs is to be able to switch back and forth between macro and micro thinking. That is looking at the “big picture” and the individual details. Knowing the size of your market but still being able to understand the needs of individual end users.

I believe that part of the reason our economy is in such disarray is the planner’s lack of ability to deal with big numbers and still see the individual costs. By focusing only on the macro, the big picture, they missed a lot of leading indicators embedded in the micro. Problems for a single individual in one place, a single company in another, or a single industry in yet another, didn’t crack their macro view. Once the leading indicators got large enough to get their attention it was too late to for anyone to stop the downward spiral.

It’s time to find the “contrarians”, the people who tried to call your attention to the dangers of your current plan. Those folks who said “those trade agreements are not a good idea”. The economists who warned their banks that they were taking on too much sub-prime mortgage risk. The investment experts that warned against buying too heavily into derivatives.

Those people saw the problem long before anyone else events have since proved right are the most likely to spot a solution, particularly since they’ve been thinking about the problems as problems longer than anyone else. Everyone else was too busy saying “there is no problem” and “the economy is fundamentally sound”!