How Cautious Should I Be in Running My Business?

Undoubtedly, the pandemic and other various economic shocks have been leaving CEOs apprehensive and stressed about running their businesses. On the other end of the spectrum, with the vaccine rollout, economists are expecting the economy to take off this year. Considering these extremes and uncertainty, it can be challenging to make business decisions.  We don’t want to miss out on opportunities that inherently involve risk, but we also don’t want to shut down due to a series of bad decisions. As we move forward, the question on many business owners’ minds is: how much caution should I use when making business decisions?

 We know, as this past year pointed out, that we should be fairly cautious. Before the pandemic, the economy was doing well – unemployment was at record lows and there was increased household wealth and spending. As we know, when Covid hit our shores, that growth was reversed, the stock market tanked and unemployment skyrocketed. For many industries, the market froze, people couldn’t come in to stores to do their shopping, or supply chains were disrupted. We know from this past year that we should exercise a fair amount of caution to prepare for catastrophic events.

So, we know that, as business leaders, we should exercise a fair amount of caution. This seems obvious. Perhaps a more helpful and revealing question than the one above would be: how should I exercise caution in running my business?

The first question - how much caution – uses caution as a limiter in strategic decisions. It asks confident we can expect to be in our environment – and if we can’t be confident, makes decisions accordingly. This is fundamentally a fair question to ask – we should consider our environment and making decisions accordingly. It is especially relevant considering we are entering into an age where technological, social, political, ecological, and economic disruption will be common. The second question – how should I exercise caution -  uses caution productively as a key part of strategy. It is understanding that caution is not just something that limits action that would be taken otherwise, but it is used at the heart of strategy to keep the business alive.

There is a concept from Jim Collins called Productive Paranoia that is useful when making decisions on how to use caution in our business. According to Jim Collins:

Productive Paranoia is a concept developed in the book Great by Choice. The only mistakes you can learn from are the ones you survive. Leaders who stave off decline and navigate turbulence assume that conditions can unexpectedly change, violently and fast. They obsessively ask, What if? By preparing ahead of time, building reserves, preserving a margin of safety, bounding risk, and honing their disciplines in good times and bad, they handle disruptions from a position of strength and flexibility. 

Basically, Productive Paranoia identifies how, when things go badly, we can stay in the game.

Consider this example from WWII with Winston Churchill.  

When Germany invaded France, Churchill had to strategize how to best help their allies. He needed to send squadrons of men to France to aid them. Even though Churchill entered the battle to help France, Churchill knew that strategically, he needed twenty-five squadrons of men to defend England should France fall and Germany would turn on them next. No matter what happened in France, Churchill was not willing to risk those twenty-five squadrons. As we know now that decision to keep twenty-five squadrons was strategic and spot-on.

 The primary question for Churchill wasn’t, “how risky should I be when entering into battle?” He probably asked himself that later, but his primary question was, “what do I need, in case this all goes south, to survive?” His strategy was one that considered what was needed to survive, and made actions involving risk accordingly.

In business, we need to understand what our twenty-five squadrons are – what it is we absolutely need to survive in the event of a crisis, and strategically protect that. That way, we can confidently move in the market when times are good, garnering a greater understanding what we can and can’t risk, and when times are bad, we have what we need to make it through.

New Day: The Importance of Creating Space and Routine Each Morning.

We have all heard the adage, “New Year, New me”. The idea that with the new year will bring forth prosperity and an renewed sense of self is not new – in fact, it dates back to 4000 BC in ancient Babylon, where the Babylonians would make resolutions for the year in a religious ceremony preceding the planting of crops. This tradition was present in other parts of the world throughout history – as a similar practice was used in Ancient Rome and with Early Christians. Today, the idea of New Year’s Resolutions is commonplace, especially in the United States, as it is estimated that 45% of Americans make them.  

At PFD, we believe in New Year’s resolutions. In fact, it’s our job help leaders and entrepreneurs set and reach meaningful 1-Year Highly Achievable Goals (1HAGs)  so that they can make progress on their Big Hairy Audacious Goal and scale their businesses. While New Year’s Resolutions are genuinely helpful, today, I would like to focus on a much smaller period of time: the new day. At the beginning of the New Year, those who make resolutions begin with excitement and tenacity for what they can accomplish, but these feelings tend to fade rather quickly. Rather than try to sustain these feelings for a year, what if we started out each day with a similar optimism and excitement? What if we intentionally took time out of our day each morning to create a positive mindset that sets the tone for the rest of our day?

“ “Write it on your heart that every day is the best day in the year.”
”

— Ralph Waldo Emerson

For anyone who knows me, they know I am a morning person, so I might sound biased when I say mornings are an incredible and magical time of day. On the best days, I will get up around 4:00 AM to pray, journal, meditate, work out, and prepare for my day. When I take the time to do these things, I find that my days are exponentially better. On these days, I have more energy, I feel more centered, I plan my day better, and I am more productive. Studies show that getting up in the morning has been linked to better stability, increased proactivity, and lower rates of depression. As we end this year of innumerable challenges, we need to give ourselves a fighting chance against the stressors in our lives. The COVID-19 pandemic has triggered a mental health crisis in America, and we need to be proactive in reintroducing a sense of normalcy and routine in the ways we have control. Our mornings are a great place to start.

Recently, I have read Miracle Morning for Entrepreneurs, and it has reinforced my firm belief in the power of routine and the mornings. The author, Hal Elrod, recommends a six-step process to implement in a morning routine – captured in the acronym S.A.V.E.R.S.

This acronym stands for:

Silence – This is the first part of the morning that is dedicated to mindfulness. As business leaders, we can often find ourselves guilty of checking our texts and emails as soon as we turn off the alarm. Experts suggest that starting your day this way actually impedes your ability to focus throughout the day and makes you more prone to distraction. Instead, take some moments to be silent – use this time to meditate, pray, reflect, etc. This will set you up to be more productive and less stressed throughout the day. During this time of prolonged stress, reducing cortisol levels is going to be paramount to your health and wellness.

Affirmations – This step is critical to reshaping your mindset. As leaders, it can be extraordinarily challenging to maintain confidence and faith in yourself and your business, especially when we have been hit with so many unforeseeable circumstances in the past year. When we take the time to recite the goals we are committed to, as well as understand wholly that we can become the type of people to achieve those goals, the results are astounding.

Visualization – In this step, leaders should take the time to picture a compelling image of the future, and what it would look like to live out of this reality. This will give us clarity and motivation to reach this future in actuality. 

Exercise – Exercising in the morning is paramount to living a healthier life and setting the tone for a positive day. Even if you would rather do a larger work out later in the day, even a short work out in the morning could be beneficial. This has been linked to increased energy throughout the day, as well as improved nutrient uptake.  

Reading – As business leaders, we should be consistently learning to be able to improve ourselves and our organizations. So many problems we face have already been solved – we just need to find it. Devoting 15 – 30 minutes to reading in the morning can help us to learn faster so we can more effectively scale our businesses. Not sure what book to start with? Check out our monthly reading lists here.

Scribing – In other words, write. In this part, journal your thoughts for 5-10 minutes. It can be something that’s been on your mind or reflection on what you just learned. This will help you gain clarity that will carry throughout the day. In addition, you could try your gratefulness practice (write 5 things you are grateful for each day) to help reframe your mind to be more positive.

After this brilliant morning routine from Hal, my best days also include a workday startup routine. This helps me to refocus on the most important things I need to accomplish in a day so I can make the most out of my day.

This routine includes:

1.     Reviewing my preparation for the morning stand-up meeting. I will do my prep work at the end of the day before, so it usually takes a quick glance to remind myself of what I need to bring to the discussion.

2.     Writing down my tasks and my schedule for the day in my planner. After this, I choose my top three priorities for the day, ensuring that these priorities are critical, align with the metrics for which I am responsible, or will help me to make progress on my quarterly goals.

3.     Meeting with my team for the daily stand-up.

4.     Emptying my email box.

After this routine, I am caught up and prepared to embark on the day. While there is so much that is out of our control right now, it is vital that we have healthy, productive morning routines as it will drastically improve our lives.

The New Year is a chance to start fresh, as it is a time where we have energy and drive to make possible our aspirations. We can apply that same energy to each new day by implementing healthy routines that foster growth, self-improvement, health, and focus. 

Some Suggestions –

1.     Read Miracle Morning by Hal Elrod.  He goes much more into depth about how you can optimize your morning to be productive.

2.     Write down your workplace start-up routine – no more than 10 tasks that will help you feel equipped and prepared to take on the day.

3.      Schedule your morning. You don’t have to wake up at 4:00 am like me, but understanding and committing to doing different tasks at certain times will improve your intentionality with your morning.

Diversity & Inclusion: An Interview with Kenneth Morris

An Attitude of Gratitude: Finding Meaning and Empowerment During Times of Difficulty

Dr. Viktor Frankl

With a world that seems so extraordinarily out of our control, it is easy to feel stressed and hopeless. Granted, there are many reasons to feel that way, but we believe that it is extraordinarily important to recognize our own agency and to intentionally shape our attitudes accordingly. This is not to minimize the impacts of the stressors people are feeling right now, rather, it is to provide a source of empowerment. There is a renowned and prolific psychologist that we would like to acknowledge when making this assertion – Dr. Viktor Frankl. Dr. Frankl is best known for creating logotherapy, a form of psychotherapy, after being the sole surviving member of his family from the Holocaust. During this time, he showed extraordinary resiliency, experiencing four different Nazi concentration camps, including Auschwitz. In his creation of logotherapy, Dr. Frankl asserted that humans are motivated by a “will to meaning”, which means that humans have an innate desire to find some meaning in life, and that they can endure the most challenging of circumstances if they are motivated by their meaning.  Frankl wrote:

“Everything can be taken from a man but one thing: the last of the human freedoms—to choose one's attitude in any given set of circumstances.”

Even if we cannot change a single thing about our circumstances, we can change our attitude to those circumstances. At PFD, we recognize the challenges that face leaders today, and we know they are numerous and difficult. This being said, we encourage leaders to take action to change their attitudes and to find meaning and empowerment despite this particular season.

One of the ways that we have found changes our attitudes is by simply introducing gratefulness into our day-to-day routine. Amie Gordon, PhD, a research scientist at the University of California, has said “gratitude is a powerful way to boost well-being”, and we have found that to be the case. Studies have shown gratefulness to be linked to improved quality of sleep, self-control, relational harmony, happiness, and generosity. Gratitude has also been shown to reduce depression and have lasting neurological positive impacts on the brain.

At PFD, November has kicked-off a month-long celebration of gratefulness. For us, per a logotherapeutic lens, we have been thankful for the relationships that we have in our lives. We are also grateful for the opportunity to continue supporting our clients in doing great work throughout this pandemic. The chance to focus on others has helped tremendously helpful when we have felt stressed, as it has taken our focus away from our challenges, and towards helping others. We are grateful that we have meaning and purpose for our business, to aid in stewarding a movement that creates world, no matter where you are born, anything is possible. We are grateful that we are able to safely get outside to the mountains in Colorado, and that the wildfires have greatly slowed with the snowfalls in the past few weeks. Finally, we are grateful to be a part of a network of leaders who, despite the outside circumstances, are relentless in their fight to make the world a better place.

In the midst of this extraordinarily challenging season, we remind you that you have control over your attitude, and it is important that you take action to positively shape your attitude. At PFD, we have found that gratefulness to be an important first step.

A session with one of our clients - Hometrends - that has shown great resiliency and commitment throughout this pandemic

Actions You Can Take:

1.     Commit to a daily gratefulness practice: write down five things every day that you are grateful for.

2.     Verbally express your gratitude each day. Saying “thank you” can be a knee-jerk reaction, so try changing the words you say to be more intentional about expressions of gratitude. For example, instead of saying “thanks for helping Jack with his homework today”, try saying, “I am very grateful that you helped Jack with his homework – it reduced my stress and it was really helpful to him”

3.     When you hear negative news, actively remind yourself of the positives in your life as well as actions that you can take that are within your control.