Letter to a business owner in these strange times is a fictional letter to anyone in this economic crisis. It is based on my personal experience.
Surely, these nights have been very tough on your heart as you are now filled with worries since every plan you hoped to achieve this year is not probably going to work out. At this time, you are already sure that we are all amid a massive economic crisis.
- Your sales forecasts will not be fulfilled
- Exchange rates have changed all your cost structure
- Your expected profit is a faraway dream
- Your budget now seems ancient history
By this moment, you order flow has dried up, nobody has deposited money on your bank account, a pile of bills lies on top of your desk and your cash flow projections in that Excel file seems a work of science fiction. I write with the authority of having lived an economic crisis at the head of a small/medium-sized family company, but without the complication of a worldwide pandemic. This period left me many life lessons I would like to share.
Psychologically you are tumbling and your mind has already developed the five worst-case scenarios. You sleep, but get no rest. Every piece of news sound worse than the previous one, and every phone call is worse than the previous one. You are literally carrying the world on your shoulders.
If you feel, I have described you well it’s because I lived that situation. But if I am here to tell this story, it is because I survived and my company survived. Just don’t expect it to be cost free. This obstacle the universe has thrown at you will be very useful for your future since it will develop capabilities you did not even consider remotely important.
Psychology and human leadership
Every business is different and every sector has its own particular situation, but one fact is constant human psychological behavior. We humans are social beings that expect the leadership from someone else. Our minds are experts in creating catastrophes in seconds time and this is the product of our neuro-biology which is what allowed us to survive in difficult environments for thousands of years as a species by allowing us to escape from dangerous situations. This part of our brain is called our reptilian brain. It is the most ancient part of our brains and does basically three functions: fight, flee or freeze.
Living in active reptilian mode consumes too much vital energy that we should be investing in other life aspects.
This situation is a leadership test that has fallen on your lap, you are the head of a micro-society that is your company, every employee has their eyes pasted on you and you are the emotional thermometer of your company.
Your employees are waiting for you to communicate with them, give them answers and an illusion that everything will turn out ok. When Winston Churchill constantly said to the public that they would fight and prevail, don’t think for a moment that he was not full of personal doubts. Even though he was seen smiling and doing the V sign with his hands, the failure of the Gallipoli incident in the first world war followed him always in his thoughts. He knew he had to speak truthfully and that dark days were coming, but he communicated the illusion of victory in a future time.
The first thing I will tell you is this: do not try to replicate Superman. You won’t achieve it. Showing a steel persona without feelings is just a showcase of how little you know yourself.
First piece of advice: Mental Health.
Your first objective is to take care of your mental health. Massive amounts of thinking creates massive amounts of anxiety. Unmanaged anxiety may lead to a depression further on. Both situations are undesirable and leave lifelong consequences for they change the way the brain works. Neural pathways are created and never forgotten, the same as addictions. Your brain chemistry will start plating against your best interest.
If you feel your head is about to explode, ask for help. A psychologist, psychiatrist or alternative therapist with some type of medication (either pharma or natural), can help you lower the volume of your thinking and give you some internal peace. You will need it to face what will come. Don’t be ashamed to ask for help. Forget about social or family stigma, the time is way beyond thinking about what others may think. It’s all about you now. If you decide to tell friends and family, that’s up to you, but by telling them you will know who is on your side even in the bad times.
If your head explodes and you do not do anything about it, be prepared for physical and psychological consequences latter on. Even if they lay dormant in your subconscious, sooner or later they will surface asking for attention and generally in a non-polite way. Our inner shadow always demands reckoning.
So, if your head is spinning, you are most certainly incapable of focusing and meditating. Fleeing to a cave in the Himalayas is not a possible option at the moment.
Instead, try listening to guided relaxations and meditations. There are tons of Apps and videos on YouTube that do a good job.
Try to exercise but really sweat it out. Make the corporal effort get you outside your head. A walk might work, but the low lever of physical activity will keep you locked in your head.
Don’t expect your mental health to work itself out. Help yourself.
Second piece of advice: Understand that this situation is beyond your control
You can make an extra effort thinking more about the situation, and still everything will be out of your control. You have no control over Trump, the federal reserve, Putin and the king of Saudi Arabia.
You cannot control macro situations, you can only control your personal micro situations in the same way you cannot control your customers and how they will react under this current situation.
Any consultant would tell you that now is the right time to cut all your expense, but that is not my purpose.
At this moment, karmic accounting is essential. If you want good actions for yourself, do them unto others first.
Try to save as many jobs as you can, help out paying your debts to your best of your capability. It may not always be possible, but remind yourself that there are no attractive options for them outside at the moment. I sometimes know it is a matter of life and death for a business to take these decisions, but don’t rush to it. Explore alternatives first. Develop empathy. Life will reward you later.
Many of your suppliers or contractors may depend on your cash flow and will not make it without your help. If you help others out, you may expect something like what happened to me to occur to you. In 2008-2009, I was very short on cash, and one of my customers without me telling him anything asked if I needed cash at zero interest. This was one of many “weird” things that happened to me.
I remember at this time I was working with two major national banks whose names I keep to myself.
Bank A freezes all my credit facilities and sucks my liquidity by forcing me to pay them.
Bank B calls me for a personal appointment, and asks me “how can we help you out”? And without asking anything of them, they extended the payment schedule lowering my monthly payment to help my cash flow.
I will never forget what I felt when someone gave me a hand in those tough moments.
Be ready to negotiate things that were nonnegotiable before. Irrational proposals might make sense at times like these.
Third piece of advice: keep your prosperity channels open.
This does not mean, spend unnecessarily. It means, save your energy but still spend it so that the virtuous cycle of money does not shutdown. Don’t consider yourself a failure or as someone in trouble, you are one among all who are in the same situation as you. Remind yourself that you are successful and prosperous. In the 2008-2009 y still contacted banks with whom I had never worked with and tried to get credit from them. I pitched them my future expansion projects. A couple of banks said that they were not taking new customers but one loved the idea and opened up the biggest line of credit my company had gotten in its history. I can’t say if it was an angel, but I still get shivers thinking about that situation that probably saved my company. You must keep faith in some force greater than logic, and economic crisis do take you to develop your spiritual self. There lies the end of the control illusion.
Do not stop asking the universe for its abundance, but this only works if you do not close your money cycle, this means, you also have to spend. Maybe this year’s Christmas party at the office will be a pale shadow of last years one, but don’t stop doing it. The intention is what counts.
Always remember Victor Frankl’s principal lesson as a survivor from the Nazi concentration camps. You cannot manage the situation, just as he had no control of being during a war locked up in a concentration camp just for being born Jewish and watching everyone around him die. You have no control over this situation and can only change your perspective about it and do the best with the set of cards you have in your hands.
Yes, with this crisis you will probably end up:
- With more debt
- Lower personal wealth
- Being reprimanded for making wrong decision, which you will most certainly make
But if you follow some of my advice beginning with your mental health, you will survive this and this will be a story you can tell about how it formed your character and changed your vision of what was significant and what was not.