10 Principles - Facts And Emotions In A Time Of Risk
Image by PublicDomainPictures from Pixabay
If there is any consistent counsel, it is that we need to make decisions on the basis of facts. Hard, objective, scientifically-based information that provides us with a solid understanding of the situation at hand, the magnitude of the issue(s), the possible actions we can take and the relative weightage and prioritization of each.
This type of information ensures that we minimize the impact of emotion - subjective ideas based on our fears, our histories, our prior baggage and “what others are saying”. They tend to obfuscate the issue and rarely get us to the right place, except by sheer luck. If we have this kind of information, we can make a solid, reliable decision that helps us in the long term.
But what happens in times like today, where there’s material uncertainty due to the coronavirus, coupled with the economic gyrations caused by oil price shocks? How are we supposed to be fact-based in our decision making? Especially when no one knows what’s going to happen with any level of certainty?
I don’t think there are any defined rules and there are no precise actions we can adopt that will get us to the right place. But I have to believe that there are underlying principles that we, as businesses, as free agents and as people can take to ensure that whatever happens, we’ve done the best we can, done the right thing and moved things forward:
Put people first. This is Job #1. Who is impacted? To what extent? What do we need to do to help those affected? Not just the minimum needed, but what’s the right thing? How can we show them - tangibly - that we care?
Do right by the customer. What are they going through? How is their business being impacted? What issues do they have to deal with? How can we help them get through this? How can we help their people? How can we help them stay focused? How can we help them stay operational?
Do right by your suppliers. The flip side of the coin - we are customers ourselves and many of our suppliers will need help themselves. Whether it’s the basics around payment terms, whether it is added flexibility, etc., put yourself in their shoes and work with them to get through this. They won’t forget those times you went out of your way to help them.
Be frugal where you can. Cash is king at times like these, especially as no one knows how long the situation will last, its ramifications on your business, your income, and even when things are better, how long it will take to ramp back up to normal. Managing costs wherever possible (but spending appropriately on the right things) is paramount.
Collect and interpret the facts daily. This is the facts point I referenced earlier. Collect the facts, collect as much data as you can. Monitor changing situations, externalities and all the events and movements around your relevant space. Do it regularly and do it often. Talk to all your stakeholders. Talk to your customers and suppliers. Collect as much data as you can that could help you.
Think scenarios. Now take all of this data and convert it into insight. Make sense of it. Consider what the alternative scenarios are and weight them based on how much of a chance you think there is that they will happen. Looking at options on this sort of a weighted basis is critical and allows us to assess what the most relevant and realistic paths are ahead of us.
Be decisive. Once you’ve got the decision options in front of you, make one. Do something. You’ll never have all the facts you’d like. You’ll never be 100% certain. You’ll never be able to make everyone happy. But you will be judged (badly) if you don’t do anything. Make a decision, commit to it, and make it happen.
Remember there will be the “Other Side of This”. Whatever the decision is, however dire the situation, remind folks that you will get through this. Economies move forward. Situations improve. Markets ultimately resolve themselves. Stay focused on the positive while acknowledging the realities of the current climate.
Err on the side of caution. When in doubt in anything involving people, jobs, lives or the welfare of your team, always err on the side of caution. An overabundance of it is absolutely fine. No one will ever complain that you played things safe, but they will remember when you took a risk with their welfare and livelihood.
Be human. I’ve left this for last because it’s the most important. Show emotion. Show empathy. Be sympathetic. Show your team that you’re one of them and you have the same issues, concerns and recognize that what they’re feeling is real. Be there for them. Be a leader.
Facts and emotions can get in each other’s way, especially in difficult times such as these when risk and uncertainty is so prevalent. While there are no rules, I have to believe that first principles, underlying values will always prove valuable.
