My father is 92 years old. He lived through the Great Depression as a child. Many of his behaviors were symptomatic of that…generosity, commitment to the common good of the family, strong work ethic, and a certain level of frugality. One of his most closely held beliefs is that no matter what adversity you suffer, the goal is to improve your situation. Don’t settle for what you had. Make it better. I love that resilience and have observed it in him many times.
I spent a good bit of my week reflecting on the idea of small businesses improving their positions despite the coronavirus adversity that all have suffered. I sensed a mild momentum swing as the US Congress unified to quell the economic impact of the pandemic. The amount of funding committed to Small Business owners is significant at $350 billion. My attention has turned to distribution of the capital, hoping it will be efficient and swift. I regret that it may not be enough for some to survive, but I believe for most it is a real opportunity to arrive in an even better place.
During my reflection, I noticed the word innovation was dominant in my mind. That seemed to be a good place to start. I found a book on innovation entitled The Wide Lens, A New Strategy for Innovation, by Ron Adner. Adner has a number of good ideas in his book.
Radner’s most resonant idea for me at this reading, one that could help any company at any time ready to try something new, is that innovation always takes place in an existing ecosystem of clients, suppliers, competitors, technology, and labor pools. The innovation’s ultimate probability of success is dependent on the Multiplication Rule of Probability. In short, the Multiplication Rule of Probability holds that the odds of two things happening simultaneously is the product of multiplying their individual probabilities of happening. If two events each have a 50% chance of happening, the probability that both will happen simultaneously is 25% (50% X 50%). The same holds true of five different things happening simultaneously – multiply all five probabilities. One piece of your ecosystem with a low probability of performing at the level you need can jeopardize the whole venture.
With relief on the way, it is time to begin planning your comeback. If you were starting again today, what would be your most compelling vision of your company? Remember, you aspire to more, not the same. Hint: your best answer will not be what you were plus 5%. It is bigger than that. What are the products and services you have never offered or the segments you have never reached?
Once you have locked in your vision, you must get very aggressive in evaluating your ecosystem. You will need to estimate the probability of every component of your ecosystem operating at a required level for your success. What is the probability that you can regain X% of your former clients and add X new ones, or expand relationships? What is the probability that you can retain X% of your supplier relationships? Employees? What is the probability that your 3 largest competitors survive? Given how we have all had to lean on technology in our quarantine mode, what is the probability that technology applied in new ways can help you serve twice as many clients with the exact same resources? Chances are that every part of your ecosystem has changed in some way as a result of the business hiatus we have experienced. Test every assumption you make, then do the math.
My father has his beliefs. I have my own. One of my most closely held beliefs is that, with inspiration, broken things become the most beautiful. You might guess that I am a sucker for home reno/flip shows. On a higher level, I have always been fascinated by mosaic art, in which shards of colorful ceramic tile and glass are mortared into patterns. Ravenna, Italy is known as the City of Mosaics, earning the city World Heritage Site designation by the United Nations. Ravenna’s Basilica di San Vitale is probably the most well-known of six Byantine-era structures in Ravenna boasting extraordinary mosaic art. It is a masterpiece.
Your business may be in pieces right now, but it can become bigger and better than you ever dreamed. It is YOUR masterpiece in the making.
In times of great uncertainty and difficulty, the exhorter’s voice may be heard as nothing but hollow cheerleading. Please take mine as a heartfelt intention for you to perform better than you ever have before. Nearly 1,500 years ago, some artisans stood by mounds of shattered colored ceramic tile and glass in Ravenna, Italy, and lifted it up to the walls in gripping tableaus of biblical history, to capturing the hearts of the Christian world. Your business has about six operating systems to refine and integrate into your greatest life’s work. Play the percentages.