Sometimes they are foreseeable, perhaps preventable. Sometimes they are
unpredictable or inevitable or both. One way or the other, there are going to
be crises of some sort. Get used to the idea.
As often as not, it is
not the crisis itself that does the real damage so much as the ill-considered
reaction to the crisis.
There are many obvious
examples of this in politics and at the higher end of economic policy. There
are even more examples in small business – the difference being that the small
business does not survive its mistakes.
So, here are the most
common mistakes that businesses make in a crisis, and some thoughts on how to
1 Panic – if you can stop yourself
over-reacting, and can instead sit down and analyse the problem calmly, the
odds are that you will find the situation is not as hopeless as it might have
seemed at first
2 Ignoring the problem – while avoiding panic,
do not go to the other extreme of pretending that there is no crisis when it
should be obvious that one is coming or has already arrived
3 Changing everything – change for the sake of
change is a classic panic reaction when you should really be working out the real
root of the problem and targeting any changes there
4 Cutting marketing – while it may be
necessary to cut costs in a cash crisis, one should also be seeking to increase
income, so make sure any cuts do not undermine your whole capacity to do
5 Borrowing – do not let the false illusion
that a problem is “temporary” serve as a pretext to delay a more fundamental
but necessary financial restructuring
6 Seeking easy answers – be particularly on
guard against salesmen who exploit vulnerable businessmen by offering to sell
you a quick fix, be it new technology, consultancy, marketing opportunities,
financial packages, or whatever.
The key to surviving a
crisis is remaining as in control of your business as possible. The key to that
is keeping a cool head and not surrendering the initiative.