Posted on 18 May, 2016 | 3 min
By Mark Estall, CEO and co-founder of 9 Spokes.
A recent Sensis research report out of Australia suggested that 80% of SMEs thought that the economy was flat or retracting slowly. The report also showed that SMEs did not think that the recent federal budget would improve their situation. This is being reported around the world as economies struggle to come out of the long effects of the Global Financial Crisis.
I find myself thinking, 'How does this affect SMEs?'
I've met thousands of business owners over the course of my career and the most persistent trait of successful entrepreneurs is fierce independence. More often than not, they've gone into business for themselves because they hate the idea of not being in control of their own destiny.
Entrepreneurs know that difficult times are the right time to get ahead. While a federal government can create a supportive environment to operate a business - the NZ government has recently announced changes to the timing of tax payment for SMEs to relieve the cash-flow pressure as an example - it is actually the way an entrepreneur interrupts the market and responds to customer needs that determines how successful their business will be.
If you look back through history, there are numerous examples of business people that have stepped up in difficult times. Take Carlos Slim, a young entrepreneur, for example. In 1982, the Mexican economy was in ruins, the peso was devalued and industries were falling apart. Despite this, Carlos Slim invested as others fled believing that nations don't go bankrupt and economies bounce back. This view eventually made Carlos the richest person in the world.
30 years later, this pattern continues to exist for businesses around the world. In 2002, Atlassian was established with no sales force - just the good ideas of Australian founders, Scott Farquhar and Mike Cannon-Brookes. Despite many challenges Atlassian has grown and in December 2015, the software company went public with a valuation of $8 billion. This business has grown during its 14 years despite numerous challenges in the market, and the global economy.
In uncertain times business owners need to step up and take control. In my opinion, this requires three key disciplines:
Discipline 1: Maintain Focus. The crises in the market must not distract entrepreneurs from their core missions. Focus on what you can control - building your businesses. Media headlines must not distract you.
Discipline 2: Stay Visible. During uncertainty, customers, staff, and stakeholders panic. To get the trust of all these people, entrepreneurs must be visible, especially to their major customers. Visibility alleviates fears.
Discipline 3: Plan. In most developed countries, bad economic times and the uncertainty that comes with it, ends. As an entrepreneur will you be ready for what comes after?