The Economic Slump Making You Feel Like Youre In A Vise? Push Back
By Linda Koco
There is an upside to the economic downturn that is rattling our country. Its the creativity and innovation of business leaders who feel squeezed within an inch of their business life.
As one of them told me not long ago, “We came up with this plan because we had to do something. We felt we were working in a vise, with expenses rising sharply on one side and payments slowing drastically on the other. That pushed us to find a way to push back!”
That particular business owner was beaming as he said this. You see, the “something” his firm started has begun to bear fruitin the form of some new orders.
Well look at the strategy in a moment. First, let me acknowledge that the accounting talk does seem to be a few steps away from the everyday issues confronting insurance product developers and marketers.
It seems to be, but it shouldnt be, for the accounting of a products financial life can point up the devil in the details. It can prod you to do a strategic overhaul thats long overdue.
That brings us back to the beaming business owner above. His company got squeezed, and he responded.
You should know that he is one of many business people Ive spoken with in recent weeks who are taking similar steps, also with some early signs of success.
Some of these people are from the insurance sector. Many others hail from other industrieshealth care, finance, real estate, communications, education, software, widgets, and more. Yet all seem to speak with a common tongue when it comes to bucking the economy.
A common tongue, did I say? How about a common strategy! Again and again, I am hearing that, to begin the turnaround, these businesses had to do the following:
–Assess the companys current position with a very clear eye.
–Find new expertise, services, skills, etc. that the enterprise acquired in recent years and start marketing them like crazy.
–Push the product innovation button hard.
Is that a recipe for instant success? Hardly. Are the ideas brand new? No way.
However, when you hear some of the thinking behind them, you might find they have more merit than they seem to at first blush.
Assessing the firms current status should be a no-brainer. Yet doing it with a “clear eye” can be tough, say these leaders.
Thats because executives must own up to failures, even projects they themselves may have spearheaded. Sometimes, pride, politics or plain old pussyfooting deters them from taking remedial action. (In those cases, hiring an independent consultant to do the assessing might help.)
Still, several who have allowed the “clear eye” to show them the entire picture, report that they arent sorry. Why?
Because the process also uncovered many “good things,” they say. These good things are business ideas that had been lying dormant in the rah-rah-rah of the 1990s wonderland economy. Theyre your proverbial diamonds in the rough.
This leads to the second strategy: Find those diamonds, polish them, and market them like crazy.
Numerous business leaders have told me that, because sales were so strong in the 1990s, their companies just let certain types of marketing go. They had no time to pursue certain new product ideas or certain classes of accounts, for instance, because their hands were already full with new business walking in the door and existing business demanding service.
Sometimes, even when they wanted to go after some new idea, they couldnt hire more staff to handle it. Here, the low unemployment rates were often to blame.
But now, they say, the strategic review process has raked up some of those old “new ideas.” It has uncovered some new “new ideas,” too.
“This frankly surprised us,” says an insurance executive. “We were going so fast, we didnt realize how much we had moved forward, in skill, experience, and knowledge.
“Today, we have a lot more to offer than even five years ago.” This firm has begun marketing these new finds and reports it has already won a few new accounts.
One of the most poignant discussions Ive had about the downturn is one I had with a company president whose firm suddenly lost a major account earlier this year.
The loss was such a jolt, he wasnt sure what to do. So, he says, “we did the review thing, and we did the discovery thing. And then we saw it. We were on the wrong path with our products. We were becoming outmoded. We needed to shift gears, go in another direction.”
The product line now being hatched will take the business sideways (from its original mission), he says. But potential customers are already showing interestpotential new customers.
He would have preferred to keep the business going as it was. After all, he founded it 14 years ago and so has a lot of himself invested in it.
“But its time for us to change,” he says. “Fortunately, weve found plenty of ways to do that. We can apply what weve learned to something else–and without letting people go.”
His words summarize exactly how product innovations burst forth from the tumult of economic downturn. Sometimes, necessity really does become the mother of invention.
Reproduced from National Underwriter Life & Health/Financial Services Edition, December 3, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.