As a crisis and risk management specialist I have helped Governments, Corporations and Entrepreneurs manage crises that involved natural disasters, economics, reputation management and financial meltdowns. When a crisis or bad news hits us, we all tend to overreact and get into fire-fighter mode. While this is natural, we should all learn to slow down, let things calm down, and better assess the move’s impactful options. In the early stages of a crisis, what you don’t do is more important than what you do, as these early actions set in motion a chain of reactions that will impact the future of the crisis and its effective management. Most of the time for the worse if these actions are not planned well.
Some of these crises are the result of neglect, bad decisions, excessive risk taking, but often are the result of external factors that we have no control over. The bottom line is, don’t lose sleep on any of this, but rather get to work, and while others panic, seek the silver lining in these crises. These opportunities are in disguise that are difficult to see. Keep in mind that there will be windows of opportunities that become available. For instance, during a crisis, you may realize what are the indispensable employees you need for your company to survive and prosper. In other words, during a crisis you can cut expensive personnel and bring in younger and more cost-effective staff. This stuff will bring in new perspectives and new models that you did not know you needed. Stay open and flexible and focus on what you can control.
Change is the only way forward during economic crisis
Periods of economic and geopolitical disruption as those since 2020, are challenging but rich in opportunities. The biggest mistake businesses make during a crisis (be it recession or any other type of crisis) is waiting too long to make changes, such as replacing expensive staff and overall reducing costs. While it is important not to overreact at the beginning of a crisis, the longer an entrepreneur waits to react and prepare for change, the further the negative impact of a crisis.
One area to prioritize during unpredictable ones like the recent ones, is to establish new partnerships with customers, competitors and tech companies that can help make your business processes more efficient and cost effective. Think of other market participants as you partner to bring your service and products to new users at lower prices.