The world is changed. I feel it in the water. I feel it in the earth. I smell it in the air. Much that once was is lost; for none now live who remember it. — Lady Galadriel. Lord of the Rings. JRR Tolkein
This quote has been running through my mind these last few months. I’ve been watching the Coronavirus statistics since early this year and it’s been nagging on my consciousness since the early reports came out of China. COVID-19 has landed on our shores in the US and its impact is being felt on a massive economic scale before the disease has fully taken hold. I applaud any and all reasonable methods to “slow the tide” or “smooth the curve”. I am also grateful for any efforts by political leaders, celebrities, and large business to help steady the markets and make donations to those impacted. My thoughts for this post, however, are geared towards those of us who live in the small business world, either as employer or employee.
Proactive vs Reactive
There are 2 key differences between a reactive response and a proactive response to crisis: how you respond and when you respond. You still have time to create a proactive response to the economic impact being made by COVID-19. Yes, the markets are volatile… Yes, unemployment is spiking… and Yes, we haven’t yet seen the full impact of the disease here in the US… but we can be proactive in our response.
If you haven’t already developed your response you need to lay out your plan now before your response is purely reactive and instinctual. Better to have a fight response planned than an unintentional flight response to the situation.
At ProvenCFO we developed the following plan:
1: Be socially responsible
2: Start marketing now
3: Improve Website ASAP
4: Provide action plan to current clients
5: Pay attention to government assistance and policy
6: Work Hard. Work Together
7: Utilize team on all fronts if possible
8: Analyze P&L and cut ALL non-essentials effective immediately
9: Reach out to vendors/subscriptions and ask for relief or temporary price cuts
10: Consider offering additional services
We spent time talking through these points and elaborating on each of these. We developed an action plan and identified specific tasks which needed to be performed and assigned these tasks with realistic dates.
Make sure the HOW in your response is thought out, hashed out, and written out. It is not a proactive plan if it doesn’t include these elements. Don’t allow your plan to be reactive based on fears and anxieties.
The time to act is NOW. To be proactive don’t wait another minute before putting your plan into action.
Focus on both the NOW and the LATER
Surfing has taught me lots of life lessons. When surfing bigger waves in hazardous conditions, we learn first hand about “the clean up set”. The glossary of surfing terms wiki suggests the following:
The clean up set is a much larger wave or a set of waves, which breaks further outside than normal. A clean-up set usually “cleans” the line-up of surfers caught further inside.
I’ve been caught inside a few hundred times to know that when the waves are big I don’t enjoy the experience much. Drowning doesn’t seem very pleasant to me and I’ve come close a few times. Avoiding the clean up set can be very difficult. When the set arrives, everyone scrambles and paddles full-blast towards the horizon. When the waves are big, everyone's focus becomes survival. It’s important in that moment to conserve energy and oxygen and to keep the heart rate low. This is in direct contrast to how fast you need to paddle. Getting over the first wave provides temporary relief, but sets of waves typically come in 3’s or more. Getting over the 1st doesn’t guarantee safety from the rest and considerable effort is required until danger has passed.
Focus on what is in front of you. One step at a time… one wave at a time… one breath at a time. This is true for the current crisis. Focus on what you can do to get yourself and your team over the challenges right in front of you. At most beaches in most countries regardless of surfing apparatus, we root for each other and try warn each other of dangers.
Remember the waves behind the first one. Don’t ease off just because you make it over the 1st wave or believe you’re okay in your current position. I’ve seen surfers stop paddling, believing they’re safe from the 1st one only to be caught unaware of the later waves. Often the last wave is the biggest.
Don’t go towards the light-house
Having a fixed reference point is great… but a lighthouse is there to warn sailors to stay away from the light. A ship needs to be flexible in charting its course because currents and winds change the trajectory constantly. We use fixed points of reference to ensure that we are safe and where we’re supposed to be. During economic volatility, a business needs to be nimble and adjust to cope with shifting tides. In other words, sometimes our original destination or plotted course needs to shift to deal with change. We can’t believe that we can sail the same course or even end up in the originally planned port when storms come.
Turbulence and storms in the the skies often result in planes being diverted to different destinations. Ships can be rerouted to different ports and businesses can shift their original strategies to change with the times.
I love the story of Peugeot for this reason. Originally founded in 1810 they started manufacturing coffee mills and bicycles. Soon they were manufacturing umbrella frames, saw blades, chisels, and wire wheels. Later during the war years, they moved into arms production making armored cars, bicycles, and bomb shells. After the war they shifted mostly into the consumer motor vehicle industry. They are still kicking it after 200 years because they had to change with the times. They ended up somewhere else than what they originally intended. Change in industry can be okay as long as you can change with it.
Stay strong, stay positive
You can do this. Be smart, be positive, be consistently smart and positive. A healthy small business is one that looks for opportunities in crisis.
Why simply survive the clean up set, when you can ride it?