This is my last article for the New Year, and I want to give some introspective about the current business environment and also provide you with some great tips for the next year. I already talked about goal setting in my previous article. You can still subscribe to my weekly newsletter and receive your bulletproof goal setting worksheet.
This time let’s prepare the mind.
Common sense in business
Do you think that even exists? Well yes, but for a tiny percentage of smart companies, those who will thrive in this new era, before, during and after the recession that’s coming.
The top 500 Forbes companies define American business. Those are the most powerful companies which don’t arise overnight and don’t just die in one day. To be part of that list representing two-thirds of the U.S. GDP you really need to be big and hard to beat. But today only 60 companies from the 1955 Forbes listing are still there.
The other’s probably expired on the big road of dinosaurs. Maybe it’s too much of a timeframe for you? Then take another statistic. If before, the average lifetime of a publicly held company was 33 years; now it shrinks continually with an estimate of 14% until 2026. Even more dramatic, the prognosis for the next ten years ahead gives a likelihood of 50% for these companies to vanish.
And so, huge brands and names who make the headlines today could be nowhere to be found ten years from now. Probably from the artificial growth which takes place now with all the capital infusion on a constant basis. Or because they won’t be able to keep up with technology. A third option is because they don’t have a Jeff Bezos as the CEO founder.
Anywise, numbers show us a story. A story of rapid change where companies who are nowhere today can be in the big league ten years from now, switching the places with current big names.
What does this have to do with common sense?
Because studying the companies during the last decade and especially since the spread of the internet and social media around the globe you can see a disproportionate way to brand, build, and place a company on the marketplace.
Today, being a big company is vulnerable because you rely on boards, old habits, hard to change practices and a lot of internal bureaucracy. So a newly comer who has a good product or service is more independent. And if that newcomer invests heavily in online, especially branding through social media, in 10 years can compete for any dinosaur.
It happened with Amazon; it’s happening now with runner-ups who follow the model. Companies who are heavily present on
Bringing reason back to business
Imagine where people spend their time now? Where they get the information? How do they talk to each other? Normal routine things which are ignored by so many businesses, big or small. If you have an ad in a newspaper that no one is reading; or a banner on the street saw only by the drivers, while the rest are browsing their phones – what’s the efficiency of your spent money?
But ok, let’s go to smaller practices. It can be a doctor, a lawyer, someone who is heavily dependent on recommendations. So dependent that he cannot perceive it anymore. Those old fashion practices which always had so many clients because they are good.
These practitioners think they don’t need to be online; or that a profile will do the trick. How many people check reviews online and document a specialist before going there? A lot. How about when everybody will do that, and a big shot young practitioner but who knows how to create an online community around will take away 50% of your business?
I could give you examples of any business, or you can fantasize about it also. Even for the taxi drivers who ran out of business because of Uber or who charge 50% less because of it. How about becoming the most known, favorite taxi driver in your town? Would you need Uber or rely on others?
Every business sector will be hit by the shift that’s coming. A new recession is inevitable as seasons. These things are in cycles, they always come. Taking historical timeframes into account, we should be already in a recession. So it can come anytime, today, tomorrow, one year from now, maybe five but I don’t believe we have five years till the next one. We live on borrowed time.
The next recession?
How will this happen? There are many options. It will come from the big companies who will then create the butterfly effect. It’s too much fake money on the markets right now — not the same way like in 2007 but similar. And also there are many unrealistic spending in marketing where the metrics are rigged or expired because they use old systems.
Once a big company will redirect and take out money from a particular expired system and place it online some powerhouses will shake and very soon others will follow and in no time a significant economic shift takes place when some sectors will become unemployed.
Or there are the heavily capitalized startups who are bleeding money and live from one ‘raise capital’ cycle to another. If the investors say “enough” and no capital will fuel the current bubble a pile of tech startups will start falling. Of course, we can have another 2008 on the same model. That’s also a possibility.
And not to mention how the game will play out between the big powers, as we all know there are struggles and one of them could just decide to make the first move when the pillar of things collapse. So there are scenarios which are boiling right now.
But people act like the ostrich in situations like this. It’s called the normalcy bias, and it runs the humankind since we can document it through history. World War II was a great example of it. Normalcy bias is one of the most common and wild spread cognitive error.
We as humans have scientifically proven cognitive errors in our system. We continue to do stupid things or quoting Dan Ariely, being “predictably irrational.” It happens all the time for each segment. We have cognitive biases about our families, friends, beliefs, values, as business owners and you can put this over any little piece of the life sector.
The future is all about brands and communities. Personal brands or business brands heavily present online (voice, video, text) with a robust community around them. Not necessarily big, but close and loyal. This future is not far. As a leader of a new era in any sector, you must know this and act upon it until it’s not too late.
Just act with common sense, see what the people who you’re targeting do, want, and be there for them. Don’t follow expired patterns. Go with technology, speed, value, empathy, quality. Don’t compromise these and work on them consistently. If you take the boat soon enough, you could be fine.
And now you should be at least mentally prepared for a better year when you use your skills and common sense to transform things to your advantage.
I’ll end this year wishing you and your family blessed and happy holidays wherever you are on this Earth. Let’s meet again next year with new energy, ready to move mountains.
See you then!
Cristina Imre – High-End Coach for Top Performers; Keynote Speaker; Business Trainer & Strategist; Author; Entrepreneur