Economic fears are self-fulfilling prophecies
C-suite must stop worrying and start acting
Even if you are not gripped with fear, the steps on this page will help you.
You’re not alone if you recently noticed a slowdown in receipts or, perhaps, a drop in new business altogether. Polls show the business community’s confidence in the future economy is dropping. The confusing hyperbole coming out of Washington over raising the debt ceiling is an important factor.
The problem so far is more related to false perceptions than reality. Nevertheless, businesses are responding by opening the corporate wallet less and being tightfisted when they do. The trickle down impact on everyday consumers — the group that actually drives the economy — is striking. Marketers hold the key and must be motivated to act.
“Consumers, businesses and investors remain extremely skittish; spending, hiring and investing freezes up whenever anything goes even slightly wrong. The severity of the Great Recession appears to weigh heavily on the general mood. Policy uncertainty in Washington regarding the federal debt limit and how to address the nation’s daunting fiscal challenges hurts as well,” Mark Zandi, chief economist of Moody’s Analytics, wrote last month. However, he predicts, “Assuming oil (prices) keeps receding and that Washington resolves the debt-ceiling issue, growth should accelerate later this year.”
Free steps C-level leadership must take now
C-level executives need to move beyond fear and instill confidence in their institutions. The impacts on employees, customers, prospects, vendors and the bottom line will be positive.
- Assemble a goals “wish list.” List those areas where you would like to see growth or improvement — customer retention, prospect conversion, new product revenue, etc. There is no harm and no cost associated with this exercise and it will lift spirits. Feel free to be fanciful since, as broadcast journalist Belva Davis said, “If you can dream it, you can make it so.” Distribute the wish list among department heads and even rank and file employees.
- Find out what sets you apart. What do you do specifically that is different from your competitors? On the surface, this may seem an easy exercise, but it is probably the most difficult. If your answer is lower prices or best rates, then you should stop reading and work on an exit strategy. Price and rate wars are a race to the bottom and few survive over the long term. Try also not to list generic differentiators such as “personal service” or “community participation.” Instead, focus on a single word that you wish to own in the market. TD Bank, for example, is working toward owning the word, “convenience.”
- Look at possible strategies. Prioritize the list you created above, consider what sets you apart and map out how you might reach these goals. Again, be fanciful and ask “what if” questions. Put aside your ego or fears of inadequacy and consult department heads, employees and outside advisors. Consider the advice of your more conservative counselors such as lawyers, compliance and internal financial chiefs, but don’t let these folks have veto power. They are doing their jobs by being cautious, but their perspectives are only one element. Few entrepreneurs would succeed if they listened only to those who worry too much about risk and focus too little on reward.
- Align operations with goals. What operational changes might be required to execute the strategies you’ve considered above? Start from scratch listing the tasks that must be undertaken and organize teams and resources appropriately. For example, when TD Bank decided to own the word “convenience,” it adjusted operations by committing to build more branches and offered extended teller hours. Just because everyone else in your industry organizes departments in a certain way and gives staff members certain titles doesn’t mean you must. Be innovative. What technologies are available to further your efforts? Undoubtedly you’ll discover efficiencies that will pay for the tactics below. Like the steps above, you still haven’t incurred any costs so dream and be creative.
- Stop throwing spaghetti. Now, look toward those external audiences you are trying to reach — existing customers, prospects, people who influence them and others. Remember local vendors are potential customers too. You must determine where these groups accept information — Web, email, magazines, newspapers, broadcast, smartphones, mailings, outdoor banners, events and billboards, etc. — before you try to send them messages. It costs too much to throw spaghetti against the wall and see where it sticks. Don’t guess where your audiences are obtaining information. Use surveys or consult professionals. Once you know where your targets receive information — and it’s probably a combination of sources — rank them.
- Develop tactics. Once you know what sets — or will set — you apart, and have ranked where your audiences learn about you and your competitors, development of tactics becomes easier. This last step is where most people begin since it is much more fun to brainstorm and be creative than plan, write and do research. However, it is a waste of time and money if you haven’t followed the preceding steps. Select the media your audiences use and take full advantages of its strengths. As examples, video is best for demonstrations, while the Web and smartphones are best for encouraging two-way interaction. There’s a whole science devoted to tactics, but the best one hasn’t been invented yet. Don’t be a copycat.
Be a team player and share your analysis, ideas and plans with everyone involved with implementing it. Obtaining feedback and making necessary adjustments helps you achieve important buy-in. Whip up enthusiasm among board members and confidently tell them how they can help.
You’ve spent almost nothing to get to this stage so put your worries aside and plan for the future. After this, you may have to spend some of your reserves, but remember you are making an investment in the longevity of your organization.
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July 9, 2011 2:15 pm 
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By Lynn Kisselbach, July 11, 2011 @ 11:15 am
Tim, I think you’re article is right on. Having “been out there” talking to clients, I think many are not sure what to do, so they are doing nothing. Understanable in our economy, but not always the best choice. I’ve always been an advocate of being more agressive in times like these. Your article draws a nice framework around a solid plan.
By Garrett Smith, July 12, 2011 @ 9:21 am
Tim —
Your six points are surely good advice, but the missing item is morality.
Uncertainty among customers may be an expression of mistrust. Example: for a decade the biggest banks sold funny paper to the unwary (they called it “collateralized debt obligations,” even though there was no real collateral), and their top people are still walking free. I call it theft.
Can a business convince its prospective customers that they will not be victims of thievery?
Best regards from a cranky old man,
Garrett