There is this old joke where you and your buddy are out hiking and you see a grizzly bear. It is going to attack. You look at your buddy and they are tying their shoes tight, getting ready to sprint… “you know you can’t outrun the bear?” you say. “I don’t have to outrun the bear, I just have to outrun you."
The COVID-19 pandemic has yet to peak, and already our global stock markets are taking a beating. It’s nearly impossible to take punches like that and not have long term financial ramifications. Our longstanding ‘bull' market is giving way to a ‘bear’ market1 There are a ton of articles being written about ‘surviving a recession’, and I want to take a different angle.
I am very empathetic to the pain and suffering going on in the world right now. For the purpose of this piece, I am separating the health issue of COVID-19, and focusing on the financial issues it has revealed. This is a rare moment in history where people are helping each other, being kind, and looking out for one another. I am not going to touch on the health issue much in this article, but I do hope it gives some perspective on ways to alleviate related stresses.
Hopefully your company has been thinking about a recession for the last couple of years - if not you’ve got some work to do. You can do it, I believe in you, but you’re playing catch up.
Keep in mind there is always opportunity in chaos. You may need to change some things (big things) but it’s not just about survival, it’s about the same thing business is always about – seeing a need and being a valuable resource to address that need. The bad news is most companies do not thrive in a recession, and many fail completely. According to the Huffington Post the last recession killed over 170,000 small businesses between 2008 and 2010.2 Small businesses weren’t the only ones – remember all the “too big to fail” talk? A lot of huge companies filed for bankruptcy between those years as well.3
This is depressing. But we shouldn't panic and assume that this recession will be as bad as (or worse than!) the 2008 recession, or that the recovery will track the same. We shouldn’t assume the same markets and industries will feel it in the same way. But what can businesses do to make it through?
Don’t ’survive’. Stay alive and thrive.
The bear is coming. Failed companies in a recession couldn't outrun the bear. The businesses that stay alive will reap the benefits of less competition and more space in the market.
Is your business helping your customers outrun the bear? If not, can you? The projects that stay funded are the ones that drive efficiency, reduce risk, save cost, and improve throughput.
All businesses in all industries need help outrunning the bear. Some industries that are the least ‘recession resistant’ will have more chaos, and other very recession resistant industries will have more stability.
As an example, the healthcare industry is very recession resistant, (people will need healthcare services in any economy) so that industry may be less affected by a recession.
On the flip side, real estate generally sees a massive slowdown. People put properties on the market that not many are in a position to buy, real estate agents look for other employment… and so on.
Whatever industries your customers are in, there are opportunities to help them outrun the bear if you look at it through the right lens. In the midst of the global health crisis we find ourselves in, I believe there are ways to use our businesses for good, and to be a force of hope and stability for your employees and your customers.
I’m praying for wisdom and guidance to do that with my business.
Hope this helps, and reach out if you’d like to chat about it.