Back in the 1970’s, I first heard the saying, “We all consider ourselves a great athlete when riding our bicycle downhill”. I still smile when I think of it. When things are going smoothly, with great momentum, we love the life we lead, and most of us are pretty sure life is great because we are so talented and skilled.
And we’ve been riding our bikes down hill for quite some time now. In fact, we are now enjoying the longest uninterrupted economic expansion in our nation’s history. While the strength of this long expanse of economic growth has by no means been a “barn-burner”, it has produced many jobs and in this last year finally some moderate real wage growth – all very welcome developments.
Here’s the rub…while there is still plenty of business activity and job growth, there are also signs of economic slowdown showing up. Consider Elkhart County’s recreational vehicle that witnessed a substantial drop in sales last month. The RV business is still strong, but this drop bears watching. A friend in Colorado who does a good national business of selling authentic Navajo rugs has seen his business tank in the last several months. People in both industries will say that their sales levels are leading indicators of where the overall economy is headed.
In his book, “The Seven Habits of Highly Effective People”, Stephen Covey urged that we are best served by working to improve our skills and overall competitiveness (what he called “Sharpening the Saw”), and what better time to concentrate on that when the wind is at our back. The time to have a fire drill is not when we face a raging fire for the first time.
Warren Buffet similarly observes that the best companies in the world “make hay” during slack periods of economic activity. They have fine-tuned the skills of their workforce to aggressively take advantage of the vulnerability of competitors reeling from damage and weakness they suffer due to recession. Great companies also build large cash reserves to buy assets they want in recessions when prices are rock bottom.
Some wise soul once said, “When God wants to punish us, he first gives us 30 years of prosperity.” In 30 years, a whole new generation has grown up knowing only good times; complacency makes us woefully ill-equipped to face the difficulties that arise during lean years.
Now is a great time to Sharpen the Saw to ensure you personally, and perhaps your company retain maximum competitiveness during a recession, whenever it occurs. A side benefit is that your success will be ever greater during economic good times. Sharpening the saw means not only emphasizing technical skills but gaining higher levels of self-awareness. They go together.
I always enjoy the story of General Electric’s response as the great depression of the 30’s blanketed them and the rest of the country in misery. The leaders of G.E. had a choice to make between laying off 50% of their employees’ or retaining everyone and cutting pay 50% across the board. Such was the distress created by the depression.
They decided to retain everyone. Thus, they retained all the talent, all the skills to maximize their competitive advantage during those tough years. This move also inspired intense loyalty that made for a tremendous culture of loyalty and productivity.
General Electric remained highly competitive during the depression, but their performance and profitability in the two decades after the depression ended was unmatched.
“Sharpening the Saw” is indeed a particularly wise activity in any environment, and our clients are finding it both inspiring and enjoyable. Why not investigate with us?
Tom Searcy, BCC
Recent Comments