How to Dominate in a Recession

People behave in contradictory ways during times of stress, such as a recession. Too many managers in too many companies become paralyzed by fear or indecision. Recessions are part of business cycles, just like growth periods. Thus, managing during a recession is part of a manager’s job — perhaps the most important part.

But what should managers do differently? The answer is “a lot,” but not “everything.” If you have managed through recessions before, you may remember what to do, assuming you did the right things. If not, consider this short story:

A man was walking along the street and, as he passed a construction zone, fell into a deep hole, one with walls so steep, he could not get out. He yelled for help.

The first passerby was a doctor, who asked if he was injured. After answering that nothing was broken but he hurt all over, he saw a prescription float into the hole and the doctor was gone.

The next passerby was a minister. The minister asked if the man was all right, and when the answer was a reluctant yes, a prayer on a slip of paper came floating into the hole.

The third passerby was the man’s best friend. The man in the hole was jubilant, until his friend jumped into the hole with him.

The startled man asked his friend, “Why did you do that? Now we’re both in the hole.” The friend answered, “Yes, but I’ve been down here before and I know the way out!”

The man in the hole felt frightened because he hadn’t been through the experience before and didn’t know how to get out. Fear of the unknown is natural. If you haven’t been through a weakening economy before, you may think of yourself as the man in the hole.

The mere word “recession” triggers fear of the unknown. How bad will it get? How long will it last? What should we do? If these are your reactions, don’t feel bad. These fears are normal when facing unpleasant events of unknown severity and duration.

The biggest mistake you can make is to act too slowly, but it’s also important to act with carefully considered intent. The second biggest mistake is denial: “This can’t be happening; it can’t get any worse.” Yes, it is, it can and it probably will. The third biggest mistake is to become defensive and reactive. When that happens, you will always be a step behind the competition — and a step late in meeting your customers’ needs.

The secret is not to concentrate on “survival.” Instead, concentrate on taking steps to dominate the competition. When the recession ends and recovery comes, you’ll be on top. Coincidentally, those same steps are the right moves to survive the recession, too.

Here are the seven most important steps to take when preparing to dominate the competition:

Attack

By definition, a “recession” means negative growth, but that doesn’t mean there’s no business. There’s just less, and it takes more, better effort to capture it. That’s when “dominate” comes into play. As you read further,