In a 1959 speech that was otherwise unremarkable, John F. Kennedy said something profound: "The Chinese use two brush strokes to write the word ‘crisis.’ One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger — but recognize the opportunity."
The part about the Chinese character for crisis is interesting, and it's no doubt evidence of their ancient wisdom, but Kennedy summed up that wisdom perfectly in the last sentence of the quote. In a crisis, be aware of the danger — but recognize the opportunity.
For entrepreneurs, both sides of that statement are important. We need to be vigilant of dangers and threats to our businesses, and we need to be able to see the opportunity in situations that others might only see as negative. This has never been as obvious as in the economic climate of the past few years. While many businesses have failed during the recession, others have survived, and some have even thrived. In fact, even many startups have come to life and done very well since 2008.
And the difference between those that have made it and those that have not can't simply be explained by the industries they were in, or other "chance" or "luck." There are plenty of examples within a single industry where one company has done well and another has folded. So, if it's not luck or chance, what has been the difference? In many cases, we can point to management as the differentiating factor. But what exactly did the company's management do or not do that led to their success or failure?
Being Aware of the Danger
The first part of the success equation in a crisis is to recognize that there is in fact a crisis. The sooner you can identify that there's a problem, and what that problem is, the sooner you can begin working on solving it. In terms that make sense to most small business entrepreneurs, there are two potentially fatal mistakes that business owners can make:
1. Never seeing it coming — The most common mistake entrepreneurs make is not recognizing a crisis before it happens — or even as it's developing. Planning is a big part of avoiding this pitfall. Being aware of potential difficulties and then planning for them ahead of time is part of any prudent success strategy. Thinking that your company is immune from setbacks and roadblocks is the worst attitude you can have. If you prepare and the crisis you were ready for never happens, you're no worse off (and will probably be better for going through the process), but if it does happen, you'll be able to snap into action in a situation where your competition might be blindsided.
2. Blind optimism — This goes back to thinking a crisis won't happen to you, to some extent, but it's more than that. Many entrepreneurs have bought into the belief that optimism is the only acceptable outlook, and the very thought of potential problems might actually cause them to them happen. "There are no problems – only solutions." News flash: If there were no problems, there would be no need for solutions. The smart approach is to recognize that challenges are bound to happen and to prepare for them. Sure, optimism and staying positive are important. You certainly don't want to go to the other extreme and constantly worry about what could happen. But there's wisdom in the adage "Hope for the best and prepare for the worst."
Recognizing the Opportunity
You want optimism? Here's where it can play a big part. Optimism is seeing the crisis and making the most of it. One of the reasons some companies have thrived in tough economic times is because they remained flexible enough to take advantage of the opportunities the "crisis" created. And that's really the key for successfully navigating most crises — flexibility. If you have a company culture that insists on doing things a certain way because, "that's how we've always done it," you'll be in trouble when rapid changes in the marketplace occur.Â On the other hand, if you are always on the lookout for the positive in any situation — even when it means changing your original plan — you'll find opportunity everywhere.
So the bottom line: Be prepared, find the bright side, and be flexible. Do those things, and you'll be able to make it through just about any crisis that comes your way. Have you successfully navigated your company through a crisis? Share with the community in the comments below or on our Facebook page!