In the recession years starting in 2008, it was all the rage to talk about ‘recession-proofing’ your business so that you were ‘ready’ for the next time around. Yet as I write this, we are not having that conversation. Even if it is clear that COVID-19 has thrown most business owners for a loop, ‘recession-proofing’ is not the topic on everyone’s lips. Almost all of us, business brokers included, have scrambled this past month with adjustments that seemed to be sufficient to the circumstances, only to see things drastically change on us one short day later.
On top of our business continuity and cash flow concerns, we business owners are worried about how our employees and their families are going to make it through this pandemic without that paycheck. As an alternative to laying them off you can send them home to work. But will they really know what to do (and actually do it) if we ask them to work from home? That’s another leadership worry. The real unknown is when it will all end and we return to ‘normal’. This unsettled state of affairs is not over yet for any of us – even those businesses in the so-called essential sectors.
This has led me to ask myself what it really takes to become a business owner who can stay the course, who can profit through thick and thin, and who can – all the while – keep his (or her) sanity intact. I’ve advised a lot of businesses over nearly 30 years – operations of all sizes, industries, philosophies and degrees of success. I know that it takes a nimbleness and creativity to stay on top (or just open for business) in the best of economies, much less in troubled times.
I guess the first thought on this topic that comes to mind is a soul-searching one: “Do I personally have what it takes to stay the course through thick and thin – through boom and bust times – with this or any business?” The answer is more about personal character than about any business skill or knowledge.
For instance, you can be the consummate numbers person. You know inside out how to do your accounting and budgeting, and follow the money accurately on a daily basis. But you are also a business owner, responsible for the whole of the business’s operations and people. So when gross revenues dry up, you need to put your spreadsheets to the side and move into market- and people-focused strategic and creative thinking. You need, suddenly, to think out of your usual box and try to match what this market of consumers needs right now with what you can offer. Number crunching won’t really help you if your ingenuity has dried up.
Make no mistake – ‘times like these’ are going to occur more than once in the lifespan of any business. Based on that premise, I guess what it takes to be a business owner in both good times and bad is three things:
- Refuse to get ‘married’ to how you have done things in good times. Good times call for different approaches from downtimes. A Boom strategy never works in Bust times and vice versa.
For illustration of this, look at those Bullish investment strategies for the stock market. They work miracles for you – but only when the price graphs are all on the rise; profits are huge when that strategy is followed in those bullish periods. They all fail miserably – and suddenly – when the market collapses into Bearish territory. You need to apply a brand new approach if you want to continue to make money in that new bearish period.
This applies to your business – you need both kinds of strategies. You and your leaders, managers, and frontline employees will need to be aware of them and have their own part to play in their implementation.
- Be able to think outside the box and change things on a dime. This is related to my first advice but is more about timing than anything. If fast decision-making and fast implementation is just not part of how you personally think or act, can you be willing to call on people who are wired that way? Calling on others who are ‘differently creative’ in times of need is a strategy that helps you all think outside the box.
As an all-hands-on-deck approach, have an all-employee brainstorming session without delay. Put all creative, alternative and even wild options on the table, with a goal to not just surviving the crisis but thriving throughout its duration. Then sift through the ideas to creatively meet the crisis … and keep the business doors open as best you can.
Remember that great fortunes have been lost – but also made – in all historic wartimes. Great fortunes have certainly been made in upward-moving bullish stock markets; don’t forget, however, that fortunes as great or even greater have likewise been made in bearish downward markets.
It is all about the strategy you have at the ready. And being ready is the key! It is all about being instantly responsive and nimble with new thinking and new behaviors.
- Have your bullish and bearish business strategies in your hip pocket all the time! Call them your ‘quiet and crisis’ strategies, or whatever you like. But be willing to use them instantly and without delays. As we have seen in these early weeks of 2020, we have needed to swap approaches overnight, and then do it again and again.
Given these three attributes or actions, we can think of Ford Motor Company which has, just this month and in record time, reconfigured its manufacturing capability to produce face masks and other pandemic items. A Minnesota pillow manufacturer has done the same, and I am sure others are similarly in transformation. General Motors is producing ventilators (a former product they know all about apparently).
A short month ago, none of this would have occurred to anyone as necessary. Agility, responsiveness, nimbleness and creativity is what it takes to own a business today.