Talk of the economy has been dominating the headlines recently. What is going to happen? It is going to get worse? Will I be laid off? What will it mean to my business? These are very real questions that worry all of us.
I’m challenging myself to look for opportunities in this situation. I’ve been thinking a lot about this and asking - how can you turn this into an opportunity for your small business, instead of getting scared and running for the hills?
Yesterday I was playing a clever little game called Galcon, and it got me thinking about what it means to play offense…
Learning from Video Games?
I grew up playing video games. Games are what got me interested in computers. First I played them, and then I wanted to make them.
If you’ve ever played a Real Time Strategy (RTS) game, like Warcraft II, Command & Conquer or Age of Empires, you know that you can’t win by sitting back at your home base and building walls. And that is the approach that most newbies take - they sit back and build their base and try to defend it from ever growing waves of assaults, and lose every time.
Galcon is a simple version of an RTS. In the game, you have to take over neutral planets so they can start producing more ships for you. At the same time, your opponent is taking over planets near him. You have to balance this “building” phase with going on the offensive and harassing your opponent. Start to take over some of his planets, and then he’ll start to spend more time trying to take them back, and defend his base rather than expanding and attacking your home planets. The game does a nice job of reminding you of the lessons from the more sophisticated RTS games.
If you want to win, you quickly learn that you have to take some risks and go on the offensive even before you feel like you are ready.
Learning from History
Alexander the Great proved this principle to be true in real life warfare as well. Alexander conquered most of the known world by the time he was 33 years old. He was always on the attack. In his conquest of Persia, his army was overwhelmingly outnumbered in many of his battles, but overran his enemy’s defensive positions using speed and mobility. In battle, Alexander would go straight for the “head” of the opposing army - their general. Once he put pressure on them or forced them to flee the rest of the army would collapse.
In the siege of the island fortress of Tyre, his army literally built a bridge from the mainland half a mile to the island fortress. Well, actually he had to build two, because the defending force destroyed the first one. Within seven months Alexander’s army had taken over this impenetrable fortress with 150 foot high walls. (A couple of my favorite books on Alexander are here and here.) Reading about his campaigns, one thing that really stands out is this: Alexander played offense.
Learning from the Experts
With respect to our current economic situation, I’ve been listening to interviews with the time tested experts. People like Warren Buffett. Paul Voelker, former chairman of the U.S. Federal Reserve. And other experienced investors and business people.
What are they saying?
They are saying that historically, successful people and businesses take a long term perspective, and look for opportunities. People who are gripped with fear make poor decisions. They are selling off stock, even in companies that have solid businesses and long term prospects. They are laying off employees. And they are falling back and taking a “defensive” position, rather than looking for opportunities and going after them.
In a recent NYT op-ed piece, Warren Buffett says, “Bad news is an investor’s best friend. It lets you buy a slice of America’s future at a marked down-price.” The people that lose money in the markets are the ones that buy stocks only when they feel comfortable (i.e. when everyone else is buying them) and sell when the headlines make them nervous.
So How Do You Play Offense?
Well, that answer is different for all of us. For small businesses, it could mean investing in your business rather than cutting back. While your competitors are playing defense, laying people off, cutting marketing and research budgets, you can hire their employees and go after their customers.
For me I’m identifying the ways that I can help other small businesses succeed in this market. Many small businesses have not made the move to the web yet, and can get a huge advantage advertising online vs paying for print media like the Yellow Pages. With limited budgets the need for effective, measurable results is greater than ever. I know how to deliver those results, and see this as an opportunity to help small businesses thrive in this economy. Google’s recent earnings announcement, one of the few bright spots in corporate earnings lately, seems validate this approach, at least so far.
What about you? What are you doing with your business to survive, or thrive in these scary economic conditions? I’d love to hear from you!
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