Catalyst Strategic Consultants: Newsletter

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Re: Turtles Can't Fly

There is a downturn: what are you going to do about it? Many just turtle – pull their heads and flippers inside their shells determined to wait it out. “What I don’t do won’t hurt me, I can’t figure out what’s happening I won’t move until it’s over.”

So they cut, fire people, freeze. I’m not suggesting that we don’t need to preserve cash, cull out people or limit capital exposure, but as Ram Emanuel - Obama’s new chief of staff says: “A crisis is a terrible thing to waste”.

Business in Western Canada is in denial. We lagged the US. Action is still falling way short of the aggression required.

Where is the market going? It’s not that hard to figure. The market is in spasm: us back pain sufferers know the path...

At onset of an episode of acute discomfort, nothing can be done. Maybe very tentative moves in a safe radius. Loosening up, we resume more normal activity but won’t venture too far from centre. Gradually normal function and confidence returns. We will be reluctant to attempt radical activity again and what we engage in next may be different.

A market has to function – it’s how we meet our basic needs. This overleveraged and overblown period has brought us to a standstill. Limited activity and exchange [say, in the field of credit] will resume. But the appetite will be only for basics. Do I need your product or service? OK, but I’m not paying for fluff or any chancy extensions or extras. Gradually, we will recover an interest in moving further out but it will never be the same as it was.

Those who wrap their heads around the emerging reality win. Turtling is not the answer. Yes, survive first. Getting to sustainability is essential. But then assessing, exploring, reshaping your business: those are next. This is the time for very lively planning and building execution capability with senior teams. Real movement and adjustment must be achieved fast. There is no slush and slack to tolerate lack of agility or failure to make bold moves that stick.

What can a crisis/ opportunity do for you? Your team needs to “grasp the nettle” as the British would say.

Bring discipline and drive to team: survival focuses the mind[s] wonderfully
Start very active managing of priorities with a team – using a tool like our Strategic Accelerator
Make acute discerning people adjustments through our fingers/arms/heart concept
If getting “tight in the shorts” as JT terms it, employ our Turnaround Prescription
Look for acquisitions and make major moves as competitors fall on hard times and fail to serve/ survive
Harvest available strong people resources now coming available

There are real risks and real gains to be ready for. These times bring business closer to the bone. For the first timer, it can be daunting. We tend to be able to plan only for versions of life we have already experienced. Maybe you’ve never been in a profound reversal before. You don’t want to go through this alone, do you?

Lean on our experience…

Doug Bouey

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