Many companies that survive an economic downturn do it by cutting everything that doesn’t keep the lights on and the doors open. In that condition, they are treading water. They may avoid catastrophe, but they’re not going anywhere. The company is set on “idle.”
Allowing the company to idle until the trouble passes might be the right thing to do, but sometimes companies continue to idle even though the worst of the trouble has passed. Why? In most cases, it’s because the CEO doesn’t trust that business conditions are really improving. Maybe we’re experiencing only a brief lull in the storm before it resumes its full fury.
People . . . and therefore, the corporations they create . . . are at their core, cautious and conservative. We have a sense that doing nothing is a safe bet. It’s not. Doing nothing is a conscious choice, and it may not be the safe choice.Our business history is littered with examples of companies standing by while smart, aggressive competitors swooped in to grab market share and competitive advantage.
Obviously, perilous economic times call for some degree of caution. But beware of too much caution. If you keep your ship in port too long, you’ll wake up one morning to find all the cargo is being carried by a competitor.