The economic environment has been sending out mixed signals over the past few quarters. In general the short term trend isn’t looking too positive. The macro-economic indicators and forecast of companies are all signalling turbulence. What should be our approach in such a grim situation?
Just like how a flight that takes on a long journey tends to face a few turbulent patches enroute, a business is also no different. As the pilot feels turbulent patch ahead, he does not panic but realises it is at these times that call for his intervention. He requests the people to settle down while he navigates through the turbulence, with calm and poise.
Similar to the above analogy, as business men and entrepreneurs, are being sounded off and sense early warning indicators of a possible turbulence, they must look at it only as a small patch or a phase in the longer journey. Decisions taken should reflect the possibility of turbulence and not look like a panic reaction. Opportunities (new and old), should be equally recognised as threats.
In recent times lot of business news speak about companies safe guarding revenues, holding on to cash, cutting down developmental expenses, delaying new investments etc While all these can be rationally justified as responses before tough time, historical evidence suggests that it is the focused and courageous business men who have emerged post crisis the strongest.
Bringing in austerity measures by stopping arbitrarily any and all long-term investment and expense during tough times, send extremely poor signals of the management’s commitment to a greater cause. While it may be easy to cut development and related futuristic costs, it is the sign of reactionary decision making. While I am not suggesting being careful is wrong, being discriminate, maintaining equipoise and believing that there is a journey beyond the turbulence will lead to intelligent and responsible decision making.
Let us treat the turbulence arising in the economic climate with due respect but not take action as if this is the last one we are going to face. Tough times are also points in time that has thrown up fresh opportunities. Since we are enroute the spoken about long term growth story, let us carefully watch out and make investments in fresh futuristic opportunities without falling prey to the over-protective herd instinct.