I’ve frequently heard it said that a major reason that small businesses aren’t hiring and growing is because of all the uncertainty out there. Uncertainties like healthcare costs, healthcare legislation, funding opportunities, taxes and state budgets along with new regulations. By golly, with all that stuff not settled, what’s a poor business owner to do?
Well, I’m not sure how much stock to put in that logic. Most business people I know are quite used to planning around “forecasts.” Forecasts, by definition, are uncertain. Business leaders use forecasts all the time and they know that predicting the future isn’t easy, is uncertain and many times fails miserably. As far as I can tell, all this economic uncertainty is just one more reason to perhaps slow down investing in some areas – which many business owners were going to do anyway!
The banks, for example, are finding that the demand for loans isn’t all that robust. “We” are yelling at them to lend, but “we” don’t want to borrow; “we” are leveraged enough. Some pundits have it that retailers don’t know what to do because the consumer is fickle – they spent in December but now the wallets seem to be shut again. Well, the retailers I know seem to have a solid plan in place and that’s to reduce inventory. That’s what they’ve done and it seems to have worked just fine in the short run. The uncertainty around state taxes and federal taxes that we can’t predict may also put off some immediate plans. Taxes may go up because the state needs revenue and they may go down because the state knows the tax burdens on business is making the state uncompetitive. So I may hold back on investing until I know a bit more, just as I do in the stock market. But I will invest eventually.
However, the main thing many of us are in business to do is to find innovative and creative ways to provide a product or service that people will buy. Given that such a new product is found, most of the business people I know will find ways around the other roadblocks and get that product to market. They will find the money or find someone who can help them find the investors.
Businesses have lived with uncertainty since businesses began to form. Sure some things may sometimes seem to be a “safe bet,” but most of the time we are not at all sure what the business outcomes will be for a new product or service. So I think the exact opposite is the problem. The problem is that there is certainty that the level of activity in our economy has slowed down and has changed. There is the certainty that the way we do business must change. There is also the certainty that our government will do something because they believe they must – and that has always lead to unintended consequences (good for some bad for others). This economy is not moving quickly because of those certainties and the fact that a wise investor will make sure s/he knows as much as possible about the market before investing.
Just as always, before this economic recession, we have the uncertainty about the return on investment for an innovative product or service. Just as always, we will have to find investors or make our own investment to get that innovation to market. Just as always, some days it is easier to get the required investment together than other days. Just as always, the leaders who insist on looking for those opportunities will be the ones who survive because they realize that there is always uncertainty. And just as always, those who are intimidated by the changes and uncertainty will either miss out on the opportunities or, worse yet, will fulfill their own prophecy of failure.
So as a business leader, what are you doing to create a corporate culture that embraces change and uncertainty? How will you shape a corporate culture that avoids economic analysis paralysis and instead find new products or services? If you are one of the presently unemployed, what are you doing to remake yourself into an employee who will thrive in a culture of change, creativity, innovation and . . . yes, uncertainty? How are you changing your own life to account for slow growth and lots of change? How will you invent yourself as the need for full time employees decreases with automation?