The sky is falling! The sky is falling! It is almost like a chicken little tale. Many people believe that the sky is falling. Entrepreneurs, business people and employees alike all think the economy is bad and the sky is falling. The economy is not bad and the sky is still where it has always been.

The economy being bad is a matter of perception. If you are an investor who is able to capitalize on all of the inexpensive real estate, the economy is great. If you are an innovative entrepreneur, like those who founded HP and those who founded Cisco, then you can prosper. Those are two of many companies started in what was considered a down economy. To the ones who can adapt and take advantage of the situation, to the ones who are prepared with liquidity, this is a fantastic economy. Everything is half off or more. To the prepared, right now is like a fire sale at the department store. Cheap businesses, cheap real estate and cheap labor are all abundant.

So, if the economy is going good for them, who is the economy not being so nice to? To the unprepared or those who are unable to adapt quickly enough, the economy seems horrible. They are the ones who perceive the economy as being bad. They were caught over leveraged in a real estate deal, unable to adapt their company to the changes, or without enough liquidity to weather the storm. To them, business is expensive and hard. They feel undercapitalized. Labor seems expensive and their world seems to be crumbling.

I am not presenting this from a disinterested 3rd party position. When the view of the economy turned to a negative perception, my technology based company had to adapt. We noticed that less and less people were purchasing new equipment. Their money was tighter. They were not cash flowing as quickly and the lending institutions were not lending them the capital required to invest in more equipment. If we continued to rely upon the same practices that generated us revenue in the past, we would have lost considerable sums of money on sales processes that were not producing. So we adapted. As I said, we noticed that less and less people were purchasing new. Well, they still had systems and if they were not replacing them when they were broke they were fixing them. So, we modified our model and targeted service aggressively. It paid off and, except for the time we needed to correct our process, we continued forward and stayed on target.

My point is that the economy is neither bad nor good. The economy is the economy. The people that are affected by the swings in the change of how the economy operates have perceptions of good or bad outcomes. If the change in the economy had a negative impact on you and your business, then you may need to step back and evaluate how you can change one or both of the variables I mentioned above: adaptable or prepared. Talk with your team and brainstorm various scenarios for swings in the market and devise game plans of how to shift and adapt the company.  In addition, initiate plans to begin to set aside portions of revenues specifically to help you weather the time it takes you to shift from one process state to another. Such as having all revenue from 1 service or all profit from 1 product be directed to your fund that supplements your cash flow while changing processes.

The sky is not falling and the world continues to turn. How that affects you and your business is up to you and your ability to be prepared and adapt.

Opportunity: a possibility due to a favorable combination of circumstances. If opportunity were to knock on your door would you answer? Most would answer, “Yes” to that question. But when you ask those same people, “What is an opportunity? What does an opportunity for you look like?” Their demeanor will change to becoming perplexed because they do not know the answer. It is a similar quandary to asking someone what they want in life. Most will have a quick answer like, “I want to be rich.” Ok, define rich. What is rich to you? The perplexed look will once again cover their face. Why? They never defined rich. How can you know you have achieved it if you have not defined it? Back to opportunity, how will you know what an opportunity is unless you have defined it? You cannot define it, for your circumstance, unless you know where you are and where you are going.

Opportunities are never missed, they only pass onto someone else. If you are unprepared, opportunity will knock and you will not answer because you will not know it is an opportunity. That may sound strange. But the statement is true none the less. Using a simplistic analogy, if a person wanted to be a carpenter and someone offered to sell him a brand new 22 ounce framing hammer for $10 – would they know it is a good deal? If they are unprepared, they would not know that brand new framing hammers are at least $25. They may not recognize that they have an opportunity in front of them. Similarly, many entrepreneurs are faced with great opportunities and never recognize them. You hear about entrepreneurs being offered or finding a great opportunity and becoming monetarily wealthy. They knew how to recognize the opportunity when it presented itself.

So, how do you recognize an opportunity? Be informed and be prepared. You have to stay educated about your industry to take advantage of industry specific opportunities. You need to have an informed professional team that will contact you when your entity can take advantage of an opportunity that they became aware of that is specific to their industry: accountants with new tax breaks, attorneys with beneficial legislation, etc. You must also be prepared. In order to make preparations, you must know where you are and where you want to go. Spend some time evaluating where you are in the stage of your business. What do you already have? In addition, spend some time evaluating and planning where you want to go. What do you need? Simply figuring out what you have and what you need will be a great start on finding out where you are and where you want to be. Take note, when I say “What do you already have? And what do you need?” I am not referring solely to your physical possessions. I am referring to processes, team members, etc.

Be prepared and stay informed so when opportunity knocks, you will be able to answer. The more informed and prepared you are, the less time you have to wait for opportunity to happen upon you. You will be able to start effecting change that leads to your own creation of situations that lead to opportunities. If you have difficulty defining where you are, what do you already have, where do you want to be, and what you need to get there, contact me.