Consider How Adverse Conditions Can Be a Blessing in Disguise
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When business conditions turn negative, take a deep breath and relax. Most circumstances are not nearly as threatening as they first appear. When dealing with the defensive postures that arise in an irresistible-force situation, a good first step is to ask how the changed circumstances could be turned into a benefit.
For example, a source of any budget shortfall anxiety is usually concern that bonuses and stock options would be decimated. Talking to your investors about the new circumstances may allow you to determine that by taking timely, appropriate action to adapt to the irresistible force, you'll end up with a net benefit over time instead of the feared loss.
Why? You'll benefit by operating under the positive influence of an offensive perspective. The stock price will soar as investors develop confidence in your new directioin, and with the higher stock price multiple you'll be able to add the important new resources needed to grow and improve faster in the future. If you do this well enough, the stock option gains may offset your lost bonus for the year.
Let's look at an example. In the 1980s, Bell & Howell Company decided to shift its mix of businesses to focus its attention into areas where opportunities for profitable growth would be much better. They moved beyond the defensive reaction of merely explaining why growth in their businesses was slow, to speeding up the company's growth.
This shift meant selling or shutting down many businesses and spending a great deal of money to acquire and develop other businesses, and these adjustments caused a lot of pressure on earnings. As a result of these changes, from 1982 through 1987 earnings grew hardly at all. Yet the stock price expanded by several hundred percent, rapidly outpacing the market averages and the stock prices of companies that were providing stellar earnings progress.
The reason: Investors saw a company that would prosper greatly in the future because of these changes, and had confidence in the company's management to do the right thing. In interviews done during that time, investors related that they were willing to ascribe value to the company's stock based on positive actions that the company had not yet made or even contemplated simply because investors had so much confidence that management would represent the shareholder interests well.
What's the lesson? Look at the bigger picture to see how you can use adverse conditions to choose a better path and attract more resources to help you succeed.
Article Source: Articlelogy.com
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