You can’t win playing catch up ball. That’s exactly what our financial institutions, regulatory agencies, Federal government, and investors have been doing since our banking system began to unravel almost a year ago.
Lenders make ill conceived loans snapped up by borrowers who aren’t thinking ahead. Regulators worry about inflation one day and stimulating the economy the next. And then start the surprises. Bear Stearns implodes. Government rushes in and brokers a rescue. Then a series of crises followed by scrambling and patchwork solutions. Fear grips the markets. Since the macro outlook yo-yo’s from decent to dire on a daily basis, investors play for short term gains. And the mantra becomes, We need to do something! Doesn’t matter what, we just have to act NOW!
Is this any way to run a country? Where is the game plan? Where are the consistent themes? Where is the focus? Where is the leadership that helps us keep our eye on the ball, instead of playing catch up ball?
I bring all this up because there are lessons to be learned for business communication. You simply have to have a strategy – and you can’t wait until everything hits the fan to devise one. You have to communicate the strategy to your stakeholders. Not once, not twice, but repeatedly. You have to make sure people understand the strategy and conduct business accordingly.
Otherwise, when you least expect it, you might find yourself playing catch up ball – smack dab in the middle of the busy intersection of Chaos and Crisis Streets.
Does your business have a strategy?
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Brad,
I haven’t been following it much, but it looks to me as though at least your government is finally coming up with some sort of a strategy, at least to manage the crisis for now.
However, you are absolutely right. Senior management has two responsibilities in this regard. The first is to actually make the big picture plan, and the second is to communicate that plan to relevant stakeholders.
It is particularly crucial that the plan is communicated with lower level employees in this regard. Staff can only follow and implement the details of the plan if they know what the plan actually is.
Moreover, the process of effective communication of the plan to others provides an interesting test – whether senior management themselves understand the plan properly. I think it was Einstein that said that if you can’t explain a concept to someone else, then you don’t understand it yourself.
If senior management are unable to communicate the strategy effectively, it is probably because they do not have a clearly defined strategy in the first place.
Andrews last blog post..Socially Responsible Investment part 7 – The magnitude of SRI
Andrew, I love your Einstein quote. One of my mentors always talked about how much he enjoyed training new people, a task most of us thought was a chore. He liked it because their questions forced him to rethink why he was doing things in a particular way. Often, those questions led him to improvements. He realized things had been done for no good reason!
Brad Shorrs last blog post..Zero Strategy Causes Financial Crisis
Brad, you are so right. Many smaller companies do not have a crisis communication plan. Stuff happens and it’s important to have a plan in place that allows you to communicate in times of chaos and crisis. Even a solo company should have a crisis communication plan. While much can be learned from corporations in this regard, we can also learn what not to do. The current US financial crisis did not just happen but is only the outward manifestation of a system that has been quietly unraveling for many years. Many of these companies (and our own government) have done a poor job with communications during this time of both chaos and crisis.
Karen Swims last blog post..Mid-Week Musings
Karen, You are right, and stated it very well. The good news is, it’s much easier for a company or an entrepreneur to develop and articulate a plan than it is for the U.S. government. (As of the moment, the market says our government’s bailout plan is still falling short, with the Dow down about 300.)
Brad Shorrs last blog post..Zero Strategy Causes Financial Crisis
It seems to me the executives involved did have a plan…to make as much money as they could in the shortest possible time. Most of the them did very well. They had their golden parachutes if times got rough.
It reminds me of the economist during the New Deal who said, “Who cares about the long run. In the long run we’ll all be dead.”
I must say, it was a bit of a shock to read this morning that Congress hasn’t approved the bailout yet. The lawmakers are trying to keep in office: “We’re all worried about losing our jobs,” Rep. Paul Ryan (R-Wis.) said trying to convince others to vote for it, “Most of us say, ‘I want this thing to pass, but I want you to vote for it — not me.’ ”
Jean Browman–Cheerful Monks last blog post..Is This Really The Best Use of My Time?
Jean, as of late afternoon, the recovery plan is dead and the market is down nearly 700 points. The debate, as you observe, is based on all the wrong things – political expediency, short term loss/gain calculations. I agree what some banking execs did was inexcusable, but I wouldn’t exactly call it a business strategy. A business strategy, at least the way I’m thinking about it, is something that advances the interest of the entire business, not just a few people, and something that is articulated publicly.
Brad Shorrs last blog post..Zero Strategy Causes Financial Crisis
As I understand it, everyone agrees that something must be done, and the House plans to reconvene Thursday to try again. Paulson said, “We need to put something back together that works.”
About having a strategy that advances the interest of the entire business in the long run…that’s not going to happen with the present compensation system. Executives are rewarded for taking risks…they win big if their bets work and are protected when those risks don’t pan out. That’s why the taxpayers are so up in arms…the bailout just reinforces the mindset and behavior at the root of the problem.
Jean Browman–Cheerful Monks last blog post..Creating a Sacred Space
Hi Brad – this is so true – you need a simple strategy and as Andrew said you need to be able to explain it properly. A lot of politicians do what Einstein said.
At the beginning of my fire and flood restoration business, I didn’t have a strategy for coping with growth. I focused on getting as much work as possible – without thinking about how we were going cope with it. And it was chaotic.
I think if you keep it simple and have a well thought out plan, it should be as easy to cope with 10,000 customers as it is to cope with 10.
Cath Lawsons last blog post..An Image Branding Mistake: I Make It But You Shouldn’t
Hi Cath, Scalability is truly a crucial part of the business strategy. This is a hard thing for entrepreneurs who haven’t had experience in larger organizations, because they can’t visualize what their business will look like when it has 10, 20, 30 employees. Sometimes growing pains become chronic and the company gets permanently stuck.
Jean, Though I abhor the compensation abuses of certain executives, I hope we don’t see the day when our government dictates the pay for private companies. But for sure, unless all this legislation and regulatory change includes better monitoring and sensible rules, nothing is going to change. Five or six years from now nobody will remember all this and we’ll have some other bubble set to burst.
Brad Shorrs last blog post..Turning prospects and contacts into customers and partners
I don’t think the government should dictate the pay for private companies unless they come running to the taxpayer for help. Then all bets should be off until the taxpayers are repaid. It’s that simple. It’s not forever. There is an exit strategy.
Jean Browman–Cheerful Monks last blog post..Creating a Sacred Space