Recession Response - 5 Stages For Navigating The Recession

I want to show you the trajectory that I've experienced at least when it comes to a recession like this and how it affects businesses. And it follows something similar to the five stages of grieving. Now as opposed to an individual grieving, we now have societal grieving. What happens in the first phase is a shock moment and shock. What people do is they respond by freezing up. Now I've been through two other significant recessions, so my experience is based upon that. The 2001 recession when I had my technology business was triggered by the 911 attacks and then there was economic decline happened again in 2008. The Great Recession was triggered by the housing market decline. Well there's that first shock. And with shock is also denial. Many businesses how they respond. Business owners will freeze and just bury their head in the sand. That often will remove those businesses because they're not taking any action to be of service to their clients. So the shock phase and right now as I'm recording this, we're, we're kind of in the, this first three layers of shock decision, orientation and then evaluation. So the shock has happened, the trigger's been pulled, it's Covid now we're in economic decline and, and recession. And the next phase is disorientation or it just says disorient disorientation as once the shock has happened, business owners start saying well what do I do? What do I do? And they put any action as the priority. Not the right action, not the impactful thing, but any action as priority. Some will be very reactionary and take on as much debt as possible. Or let's take all the cash out of the credit cards. Let's, let's continue to pay payroll and continue to incur expenses but not change the business to address the need. Those actions without consideration of its impact give temporary relief but long term agony. Often again we see a big drop off of client of businesses here as they do the inappropriate actions to sustain the business. Cause they're just doing any action without consideration of the impact and the business is out. Then we go into the evaluation phase and we're, we're not there yet as a society, global society currently. But I do see businesses that have moved here. The goal of our business is as very quickly as possible get down to evaluation. Evaluation is measuring the metrics, understanding the data, not our gut and emotion. But exactly what does our business need from us by analyzing the data, getting very logical. So the problem entrepreneurs have is that I trust my gut, my instinct says we need to sell our way out. But My instinct says I need to take on debt. Let's look at the data and validate that instinct. Is your instinct really pointing you in the right direction? In many cases in this point, because of the disorientation, our instinct is pointing us in the wrong direction. So we need to back it with data. So we go through thorough evaluation analysis for many businesses, not all, but it usually takes two to four weeks to start seeing a data trend. Are we actually losing clients or maybe are we gaining clients? What exactly is going on right now? And then go into the deliberate impact and action phase. This is where we sustain our business or grow. So businesses that don't evaluate and continue to trust their gut will start falling off. Here we will see a loss of your. Your competition will go away because they don't manage these first three phases appropriately and they fade out. But in deliberate and impactful action, the goal here is to be very clear on the next one thing to move your business forward. There's thousands of demands put on you now, but what's the one thing that's most impactful for your business? I developed a process I called the business hierarchy of needs. And this is just by chance, but Fix this Next was designed for business in crisis or challenge, not knowing what to do, either through macroeconomics or macro microeconomics. We're experiencing a macro trend right now. What's the one deliberate action you need to take? We do that by evaluating the data. We take a deliberate, very specific action. I also encourage businesses, and we're doing this ourselves, to bring in outside help. Bring in a consultant, a advisor that can give you direction because they're not emotionally attached to your circumstances. They don't have bias. They can be very logical. So we have to then use that analysis that we conduct internally or the help with an external party to identify what's the one thing to do now and then take deliberate action on it. If you do that, it starts the upward curve. We also use a strategy not coined by me, this was by Dale Carnegie called daytight compartments. Breaking down action to very short segments. So instead of doing the three month or three year vision and planning, what action do we need to do to achieve that? We, we start ratcheting back to say, what do we need to do in the next week or the next day or even in some cases the next hour to keep our business moving forward and start a healthy trajectory. Many businesses won't take deliberate action. They'll sustain because they're taking some appropriate actions, but it's kind of aimless. Those businesses often start a long slow fade here. They sustain, but they start a fate. This is actually the most common trap I'll see after these early businesses get wiped out because they have taken no action. They the ones that are taking randomized action that's occasionally helpful, occasionally not do this long kind of decline. The final phase though is the burst. And the burst is there will be a surge of new activity and new opportunity. We don't know if it's six weeks or six months or a few years from now, but the burst will happen. The burst is where there's pent up demand from the customer base who hasn't been making purchases, now comes back into the market looking to make purchases. There is a dearth or a slowdown in supply because your competitors have fallen off the map here. So there is lower supply, heightened demand. That gap is a beautiful opportunity as a provider because now people are flocking to you, but you need to be prepared for it. Can you handle surging activity? So what we do here and what we should start considering soon is we start recruiting resources now. Recruiting is not hiring and bringing people on. If you can't afford to do that now, you don't do that now. If it doesn't serve your business now, you don't do it. But you lay the groundwork, you put the elements in place that when you are positioned for the burst, when the demand starts to increase, that you can very quickly assemble the resources so the groundwork is laid out now. And then when the burst happens, you're the one who captures it. So that's the four distinct phases that I've seen in, in situations like we're experiencing now with COVID This is what you can do in your business. I want to move you to this evaluation, this critical evaluation phase as fast as possible so we can move on to deliberate action. We're going to be down here, but we need to get here quickly to do this evaluation and start the upward curve as quickly as possible and then you'll be primed for the burst. I'm wishing you tremendous success. The world needs small business owners success more than ever right now. So please be an entrepreneur who stands up, steps forward and kicks some ass.