By Eric Greene
The impending recession brings with it uncertainty. What I am certain of: over my 30+ years in business, I’ve been part of organizations that were more reactive, and I’ve been part of forward-minded businesses that were more proactive. The more proactive businesses have fared better virtually across the board when it comes to difficult times.
As proof, what did the last U.S. recession (2007 – 2009) and the onset of Covid teach us about the importance of being proactive and forward-minded, not reactive? No surprise, organizations that have a forward-minded mentality fare much better than ones that do not. Knowing that another recession is coming, keep these insights in mind:
- In distressed times, forward-minded organizations experience stronger growth and performance than their more reactive counterparts
- In distressed times forward-minded organizations have better morale and more resiliency than more reactive organizations
How can you become forward-minded with a recession coming? The solution is scenario planning, and here are some best practice practical steps:
- Identify the largest problem(s) the coming recession presents for your business: what are the biggest barriers you are about to face as the recession comes? For example, is it rising costs relative to what you are able to charge? Is it labor issues? Is it falling customer demand as free cash diminishes? Think hard about what your true battles will be.
- List out possible scenarios of what the recession situation will be like for the next 1-2 years: how might this play out for your business? List the possibilities of what could happen and what the situation might look like for your business, your customers, your industry.
- Play the If/Then Game: for each scenario from #2 above, how might this impact your business? And what options do you have for each given scenario in the oncoming recession?
- Determine what makes the most sense: having reviewed the most likely scenarios and your options for each, what solutions make the most sense? What solutions to help your business keep coming up over and over, regardless of the scenario? The goal here is to identify the best strategies to help you for each scenario, and to identify common strategies that can help you no matter the scenario.
- Pay attention: as things unfold in the next few months, which scenario is emerging and playing out? Because you have thought ahead, you are able to adjust and act more quickly. This can only benefit your business and your psyche as events unfold.
The months ahead are filled with uncertainty. You can’t eliminate the uncertainty of what is to come with the recession. But you can anticipate, think and plan ahead. This will dramatically increase your odds.
Eric Greene is a proven executive and entrepreneur turned success/executive coach + advisor at the Greenehouse (www.GHouseCoaching.com). Pouring my experience into helping you work smarter. Lead better. Stress less. Have more fun doing it. And kick way more ass along the way.