By John Rampton, the founder of Palo Alto, California-based Calendar, a company helping your calendar be much more productive.
Predictability is comforting in life and business. But sometimes, all the spreadsheets and predictive modeling in the world can’t foretell what’s up ahead. It’s why there’s always a bit of risk with every venture. While uncertainty doesn’t make a company’s leaders sleep any better at night, it’s an element of business they must face. How well they prepare their teams for the unknown can determine an organization’s resilience and adaptability.
You can think of uncertainty as another word for change, but it’s not that clear-cut. Change can be positive, consciously chosen and thought out ahead of time. Knowing what’s around the bend can help leaders and their teams more deftly turn the corners. But with uncertainty, there’s not always a road map to follow. Yet those at the wheel can more successfully lead their teams by applying the lessons below.
Get Ready For Ups And Downs
As much as people would like it to, the economy doesn’t move in a steady straight line. Instead, it tends to operate more like a rollercoaster. There are twists, turns, inclines and drops. Some “surprises” feel like a small blip, but others can take your breath away. Despite the differences, you know ups and downs are a given when you hop on the ride.
Since 1857, recessions have happened just shy of every four years. While you can’t always predict when a recession will happen or how severe it will be, you can bet one will eventually occur. Chances are good that you’ll deal with more than one in your lifetime and your time as a leader.
Ignoring the probability of rough times ahead won’t change their trajectory or their potential effects on your company. Designing flexible plans and processes can keep your business on track despite economic uncertainty. When consumer spending slows, you may need to adapt your sales, marketing and customer service activities. If you don’t have enough built-in agility, you might not adjust as quickly as you should.
Practice Honesty As The Best Policy
The saying is cliché, but it holds true during ambiguous times. Your staff deserves to know what’s happening, why and how the company will respond. Even if transparency means admitting you don’t have all the details, it’s better than letting people’s imaginations run wild. Without reassurance from leadership, uncertainty tends to feed the rumor mill. The speculation can impede productivity, increase turnover and build resistance to change.
Take restructuring as an example. Throughout a business’s lifespan, operations are more likely to change periodically than remain stagnant. This could be because of growth and new markets. Or the adjustments could arise from the need to embrace a new strategic direction. Restructures might also be the result of acquisitions and mergers.
In each case, the changes can be disruptive to the team. Team members may worry about their futures and what their jobs will look like. Even if they’ve been assured they won’t be laid off, your staff will face uncertainty about learning new skills and perhaps working for leaders they’re unfamiliar with. Letting the team know changes are coming and how they’ll impact their work can prevent ill feelings. Employees will be less likely to feel betrayed and express resistance to the company’s goals.
Monitor The Regulatory Environment
Changes in laws can abruptly impact businesses, as public health ordinances during the Covid-19 pandemic proved. As companies shut down, 1.2 million jobs vanished in 2020’s second quarter. To some business owners, the sudden changes in how and when they could operate felt like government overreach. However, the intent was to control the spread of the virus and mitigate threats to public safety.
Holistically looking at regulatory changes and assessing the probability of those developments makes it easier to adapt to them. Undoubtedly, not all shifts in the legal and regulatory environment impact every business equally. But it helps to know where public and lawmaker sentiment is moving so you can prepare for potential transitions.
For instance, new legislation could completely transform your industry or the products you sell. You don’t want to keep plowing straight ahead as though those possibilities don’t exist. Without preparation, your business may become insolvent because it lacks viable offerings. Examples include state bans on gas stoves and regulations governing the brands of equipment allowed on cell towers. Diversifying your offerings and creating supply chain contingency or transition plans can help your company circumvent or mitigate regulatory threats.
Navigating Uncertainty
Preparing for economic, operational and regulatory changes makes the inherent uncertainty of the economic landscape less daunting. While there’s still a degree of uncertainty leaders must get comfortable with, it’s comparable to walking in the dark. If you remember to bring a flashlight, you may not be able to see everything, but you can likely illuminate enough to safely make it through.
