Focusing on the things that make the biggest difference to your future prosperity.
(Note, although this article was written in early 2002, it is totally relevant. Right now.)
About three weeks ago I was surprised by this headline in the morning paper:
“Fed says September 11th hurt economy.”
“What did I miss here?” Was this news? USA Today thought it was. I was shocked the Fed saw fit to announce it.
And this week, another one: “NBER Confirms Recession.”
Hey, Greenspan! Get out and talk to people. All over the country people tell me that if they break even this year, they’ll consider it a win. If that’s not a “recession”…
But have you ever wondered what it takes to end a recession? Not the textbook answer: two consecutive quarters of growth. Have you ever wondered what causes those consecutive growth quarters in the first place?
The economy turns up when enough people get tired of the economy being turned down.
Companies need things. They need new people or new services like marketing and sales. Some need new premises or new equipment. You might be saying something like “We really need this or that but we’re not spending another dime until the economy gets better.”
So we suffer from a cascade effect where you are waiting for someone else to make the first move — and the economy spirals downward — getting worse and worse — until…
Until people begin to say, “I’m tired of this,” or “I can’t wait anymore,” or “Let’s get going.” And as if by magic people start spending money again, and poof — the recession’s over.
I’m a growth strategist — I help people figure out the best way to build their businesses and make more money. I’d like to know when this recession will end, but I’m not an economist and that’s to difficult a question. Instead, I ask know how much longer can people sit on their duffs before they finally get so tired they have to act again.
I expect early next year people are going to reach that point. Although The Fed just made it official, many businesses turned down in the third quarter of 2000, and haven’t picked up since.
Aren’t you bored with all the do-nothing? Don’t you want to start building your business again? Of course you do. What do you think everybody else thinks?
(Side note: This forecast is right in line with the “professionals” who say the recession will end mid- to late 2002. That will only happen if entrepreneurs and consumers start spending early in the year.)
So what are you going to do about it? What are you personally going to do to end the recession?
What are you going to do to start making money again? (I agree with President Bush. You don’t have to put that flag away, but the most patriotic thing you can do right now is start spending money. If enough people take that leap of faith, the global economy will take off like a rocket.)
Are you going to be ready?
Now is a good time to prepare yourself for the next time when people decide to start “doing business” again.
Last month I outlined a way to polish and even rethink your business strategy. Here I will quickly review the critical factors which will insure your success.
A plan designed as a platform for growth and profits must consider each of the following critical success factors:
Money factors: positive cash flow, revenue growth, and profit margins.
Acquiring new customers and/or distributors — your future.
Customer satisfaction — how happy are they?
Quality — how good is your product and service?
Product / service development — what’s new that will increase business with existing customers and attract new ones?
Intellectual capital — increasing what you know that’s profitable.
Productivity — how efficient are you? How effective?
Strategic relationships — new sources of business, products and outside revenue.
Employee attraction and retention — your ability to do extend your reach.
Sustainability — your personal ability to keep it all going.
For each factor ask these three broad questions.
1. What can you learn from last year’s experience in this factor?
What did you do right? What worked? Always start with this question. Why? Because it’s positive. That’s why! It’s shocking how people naturally drift toward the negative. Even when I ask — verbatim — what did you do right, more than half the time people respond with something they did wrong.
How can you do more of those “right” things? How can you make them even better? How can you apply what you learned in this area to some other?
Only when you’ve exhausted this line of questioning ask, what did you do wrong? Not to beat yourself — to make sure you don’t repeat it and discover ways to repair or improve the process.