I was astonished a couple weeks ago when I heard that some of the farmers in Wisconsin would no longer be able to sell their milk to Grassland Cooperative as of May 1st. Grassland’s Canadian market had suddenly disappeared because Canadian farmers had found a loophole in NAFTA and were forcing United States milk out of Canada. The new Canadian policy was encouraging Canadian processors to use domestic milk instead of imported milk. That left Grassland without a place to sell much of the milk they had been taking. Thus the company informed Wisconsin and Minnesota farmers that their milk was not needed.
This was a shock to seventy farmers. Unfortunately, they didn’t have many other companies to contact to take their milk. Milk processors are small in number. Finding another company to take the milk was difficult, especially since the market had shrunk. They couldn’t stop milking their cows. That was a daily task. They couldn’t get rid of all their cows. They were the lifeblood of the farmers’ income. These farmers may have taken the only viable option and dumped their milk. The short notice change was a threat to the existence of many these farmers.
Thankfully, three processors stepped up and offered the farmers a contract. Initially, the one who signed the majority of the farmers suggested too low a price. After the farmers’ refusal, the processor came back with a second offer that was better, although it still did not equal what the farmers had been receiving for their milk. In desperation, most signed the six-month contract with the processor.
These farmers have been caught by the changing business environment. All businesses today operate in a dynamic environment which more than ever before can change abruptly. Those quick, unexpected changes are outside our control, which makes their occurrence even more upsetting. What do you do? How do you handle it? How can your business survive these changes?
While nothing can provide a guarantee of survival, you can take managerial measures to anticipate the problems. You can list these threats from outside your company that may arise from any environment - economic, social, political, legal, technological, competitive, and weather. List all you can imagine from the most threatening that could close your business to the least that would be an annoyance but not serious. This may take several sessions. After doing that, think through your options to respond to each situation. At first these solutions may seem hard to find and few in number. As you continue to think about and discuss them, you will discover more options and realize the result of taking each one.
This is akin to a fire or tornado drill for your business. You are creating the path to take if your business is threatened by the changing business environment. Successful people identify crisises and decide how to handle them before they occur. When you are in the middle of a crisis is no time to consider the situation. You are too consumed with the problem at hand. You are overwhelmed and tired. Your mind is paralyzed. Your nerves are frayed. If the situation is dire such as what the farmers were experiencing, you may not have time to consider options.
I remember an old adage that when you are in the middle of a rushing stream is not the time to discover a leak in the boat. My suggestions may seem monumental to address. Take them in small steps. Don’t think you will address all of them in one sitting. You may find yourself adding to the list as you proceed. Do make it an ongoing priority for you and your staff to update and discuss the threats and how to handle them. Since the business environment is continually changing, new potential problems are constantly showing up. Exercise your problem-solving skills regularly by identifying and considering how to handle them.
As Socrates noted, “The secret of change is to focus all of your energy not in fighting the old but in building the new.”
This week's marketing trivia challenge is What crisis have you seen a business handle by preparation? E-mail me your answer.
This was a shock to seventy farmers. Unfortunately, they didn’t have many other companies to contact to take their milk. Milk processors are small in number. Finding another company to take the milk was difficult, especially since the market had shrunk. They couldn’t stop milking their cows. That was a daily task. They couldn’t get rid of all their cows. They were the lifeblood of the farmers’ income. These farmers may have taken the only viable option and dumped their milk. The short notice change was a threat to the existence of many these farmers.
Thankfully, three processors stepped up and offered the farmers a contract. Initially, the one who signed the majority of the farmers suggested too low a price. After the farmers’ refusal, the processor came back with a second offer that was better, although it still did not equal what the farmers had been receiving for their milk. In desperation, most signed the six-month contract with the processor.
These farmers have been caught by the changing business environment. All businesses today operate in a dynamic environment which more than ever before can change abruptly. Those quick, unexpected changes are outside our control, which makes their occurrence even more upsetting. What do you do? How do you handle it? How can your business survive these changes?
While nothing can provide a guarantee of survival, you can take managerial measures to anticipate the problems. You can list these threats from outside your company that may arise from any environment - economic, social, political, legal, technological, competitive, and weather. List all you can imagine from the most threatening that could close your business to the least that would be an annoyance but not serious. This may take several sessions. After doing that, think through your options to respond to each situation. At first these solutions may seem hard to find and few in number. As you continue to think about and discuss them, you will discover more options and realize the result of taking each one.
This is akin to a fire or tornado drill for your business. You are creating the path to take if your business is threatened by the changing business environment. Successful people identify crisises and decide how to handle them before they occur. When you are in the middle of a crisis is no time to consider the situation. You are too consumed with the problem at hand. You are overwhelmed and tired. Your mind is paralyzed. Your nerves are frayed. If the situation is dire such as what the farmers were experiencing, you may not have time to consider options.
I remember an old adage that when you are in the middle of a rushing stream is not the time to discover a leak in the boat. My suggestions may seem monumental to address. Take them in small steps. Don’t think you will address all of them in one sitting. You may find yourself adding to the list as you proceed. Do make it an ongoing priority for you and your staff to update and discuss the threats and how to handle them. Since the business environment is continually changing, new potential problems are constantly showing up. Exercise your problem-solving skills regularly by identifying and considering how to handle them.
As Socrates noted, “The secret of change is to focus all of your energy not in fighting the old but in building the new.”
This week's marketing trivia challenge is What crisis have you seen a business handle by preparation? E-mail me your answer.
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