On Monday we discussed strategy – what it is and what it isn’t. We outlined the steps that need to be taken to build and implement a strategy. And we further differentiated between strategies and goals. A question we often get from business owners, especially now, is: how can we possibly plan is such an unstable economic environment?
It’s a fair question considering:
• The dramatic stock market swings that feel like we are on a class 5 roller coaster and being upside down at times just doesn’t feel right
• Congress and the White House in ideological deadlock on how to address the economic problems we face
• Mismatch in some businesses between the skills they need in staff so as to grow the business and the skills available in the marketplace
We have advised in the past and we advise again, while the economic outlook is unsettling, it is important to understand how your company is doing and how your clients/customers are doing. Some businesses are still doing quite well even in these tumultuous times.
The Wall Street Journal ran an article on an Indiana machine shop business – Bremen Casting, Inc. – (8/10/11 – Section B-1) who is deciding whether to continue the expansion of their melting metals capacity. The executive team met to decide whether to request an additional $5M bank load to complete the expansion. They looked at their customer base (15 companies represented 50% of sales). They looked at the order pattern and concluded that their custom base was solid and they did not forecast, based on data, a drop in demand. They went forward with the loan and continued to add capacity.
This is a good example of looking at your market as it exists for you and your clients/customers today rather than extrapolating bad news to your market. One is analytical and pro-active, the other is emotional and reactive.
Focus on what’s real for your business, identify and then focus on the opportunities your competitor’s will open up for you based on their over-reaction – and act accordingly. It just may be the time for you to become aggressive.
Copyright 2011 Kubica LaForest Consulting
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