We are nine months or more into the latest economic crisis. It is interesting to be a spectator to the unfolding drama and learn lessons from the process. I think the first thing that I am very aware of is that I feel very fortunate not to be experiencing the effects of this first hand, and I have great empathy for anyone that has been affected.
The next thing I am learning is that the dire predictions have not played out as many had thought, but the solutions may bring about the reality. While this may sound as though I am setting up for a political commentary, I do not have the insight or courage to go down that path.
I do believe, though, that there are lessons for small businesses and think that you can take control of your personal situation and can make a difference for your family, your employees and perhaps even your community. I’ll take you through some of the lessons that I have learned, go out on a limb and make a couple of predictions and then discuss your personal stimulus plan that you can use to take control of your situation and improve your outlook.
We are at the beginning of the process that will continue to unfold over the next several years, but I can make some predictions and conclusions from the current state of affairs. My first prediction is that we are only at the beginning, which means that the economic situation could dramatically change for the better or worse – I hope for the better but am prepared to make contingency plans for the worse.
It also appears that many global situations may take precedence over the economy. It appears that as small businesses we should all be prepared for more regulation and higher taxes. This is already unfolding in my home state of Oregon and many others across the U.S.
I predict that this may also lead to some population migration based on lower taxes, better services or better opportunities. It is tough to make specific decisions based on macro economic situations however I think that it should play a role in your strategic planning.
It is a bit early, but I think that we are able to learn some lessons from the current economy and the political response. As I stated earlier, it is very early in the process, and things like high unemployment, inflation, deflation, privatization and government take-over of industry can be affected by so many different issues and factors that it is hard to make any predictions with certainty.
I do know that the more debt that is incurred by national, provincial, state and local governments, the more that these solutions will impact our long-term prospects for independence. I also believe that some pain will be required in order to fix the current employment and earnings crisis.
I also think that ignoring the problems will not lead to sustainable solutions. While you and I may not agree on solutions, it is also reasonable for steps to be taken to resolve the problems and minimize the impact on our businesses and personal lives. That being said, I also am not aware in history where government spent their way to prosperity. I think we have a dynamic economy, and government-provided solutions take so long to implement that the problem has now moved.
My final unfortunate thought is that greed is a greater motivator than legislation. This has proven true in the lead up to our current situation and also in the implemented solutions.
I am sure that we can all agree that we have many problems locally, nationally and globally. I think the disagreements will come in the perception of severity. That being said I also would like to offer some solutions for you and your business.
My first and simplest recommendation is that you should spend your time worrying about the items that you can fix and don’t spend too much energy concerned about issues out of your control. As a small business, it is important in difficult times you focus on fiscal discipline and control.
This does not mean that you do not spend money; rather, that you do so with a plan. Cash is an important resource when it is in short supply and, if you can manage cash, you can control many opportunities.
When times are tight you have less room for error, so your plan should be reviewed often and adjusted as conditions change. There is a lot of room for growth and many opportunities for success exist. Your marketing should be focused and targeted. I would spend my time on high-return activities and also focus on building relationships.
Your marketing activities and business growth will be achieved by increasing the work from your existing contacts. This is your lowest-cost, highest-return activity. On a macro level, small businesses need to be a part of the solution, but have been omitted from many of the stimulus programs. Over half and, in some states, over 90 percent, of people in North America are employed by small business. Lasting reforms will leverage this resource, and entrepreneurship is the key to transformational change. I am not sure how, when or if this will be a part of the solution, but it should be.
I am a fan of Dave Ramsey. For those of you that do not know, he is a financial advisor that has a syndicated radio show and another on the Fox Business television. He espouses the virtues of savings, fiscal discipline and debt reduction.
Dave held a “Town Hall for Hope” that contained three key aspects. These three items are: take action, stop listening to loser talk, and start giving. I liked the direction of his message and would like to expand on each in as a summary for my economic stimulus plan.
I believe small businesses have the power to craft their destiny. You are in control of your direction and destination, the key is to proactively plan where you are going and then take the steps to get there. I think that your plan can be encompassed in Dave’s three points.
If you are going to create your own success and not participate in the economic downturn, then you need to be a person of action with a plan. Your plan should clearly define where you are going and how you are going to get there. Then you need to communicate this plan to your entire staff and provide frequent updates on your progress.
Like a roadmap, you should have timely measurements that tell you if you are on track to achieve your goals. These measurements will serve as a communication tool to maintain focus and achieve short-term victories. The business environment is rapidly changing and if you want to be successful you need to create a dynamic plan that adjusts as the conditions change. If you focus on a solid and dynamic plan and become a decisive leader of action you have taken the first and most important step in creating your success.
Dave’s next point is “stopping the loser talk.” To me, this has several components, but overall it plays an important role in developing a truly exceptional company.
Today’s world is full of negative information, in newspapers, on the news and on the radio. As the leader of your company it is your responsibility to communicate a message of hope to your staff. If you are down, negative and pessimistic, then you can expect the same from your staff. If you are optimistic, proactive and confident, then you can also expect that reflection.
In order to create an exceptional company you will need your staff’s discretionary effort. There are many components to achieving this effort, but it must start with engaging the hearts and minds of your staff with your compelling vision.
Make sure that what you read and listen to helps you to communicate a message of hope and a vision of prosperity for your company and your staff. Take a lead in influencing your staff by circulating quotes, positive articles, inspiring books, and motivating movies.
As your company and individuals accomplish results and meet goals, then celebrate achievement – often. As the leader of your company you have the ability to create opportunities for your staff to excel. Make sure you have upward mobility in your company, training options, timely coaching and feedback and the tools to help your staff achieve success. When you do this you can liberate your staff and give them the tools to succeed.
The final step is to start giving. This can mean many things, from donations to contributing to your community. I would like to focus on several aspects starting with giving the resources of your company to your community.
One contributing factor in your success is the area where you work. As you achieve success you should work to make your community a better place. You can dedicate a portion of your earnings to social justice activities as well as providing an outlet for your staff to give their time to worthwhile causes.
People around you are experiencing tough times. Whether you participate through your local Rotary, The Blue Goose or even your church, you should consider donating time, company resources or money – it is an important element in your success. You should also find your voice and try to influence your local and national leaders to impact reasonable change that is important to you, your family and your employees.
Finally, you should give your staff the tools to be in control of their future and to be able to provide for their family’s needs. You may consider the resources on Dave Ramsey’s website or even the resources of counselors or financial planners for your staff. If you give your employees education then you are also providing them the opportunities to access the things that are important to them in life.
While I understand that things are tough right now, I also believe that we all have a strong and bright future. You cannot sit back and wait for success, you need to take control and create your opportunities. I am certain that with the right focus you will see that this can be your best year ever.