How to Plan For the Future of Your Industry
Humans are notoriously bad at telling the future. And you’d better watch your wallet anytime you’re around someone who says they’re good at it. But surviving in a competitive business market does take a measure of foresight. Most of the people who seem to be able to read the crystal ball of business are actually just employing a wider knowledge of history and business principles. Here are some of the ways that business leaders keep their edge, and ways to you can become a long term leader in your own sphere.
1) Understand the Cycles of Business. There is an ebb and flow of every industry. This is true of housing, the stock market, politics, etc. Even “new” industries like eCommerce are following pre-digital rules, and can be understood in a larger historical context. Let’s take an example from The Market, one that, properly understood, would save a lot of people a lot of money. The stock market has, since its inception, shown an overall tendency to grow. This holds true for decades and centuries, but is much more difficult to observe in the short term. And indeed, things get choppy in the day to day. Rise and crashes happen all the time, but the overall trajectory of the market remains. This means that individuals and businesses that trade in stocks will do better, statistically, to keep their holdings for the long term than to buy and sell all the time. And this holds true, statistically, though there are outliers who would have us believe they are breaking the trend through their own ingenuity. Whatever your industry, there are historical factors, like the history of growth in trading, that you can understand to guide your decision making. Take an extra six months before you open your business to understand the industry you are setting out in. It’ll be worth it, because the future tends to “rhyme” with the past. ERP is a great way to help chart a specific course, based on statistical understand of various market factors.
2) Understand that Expansion = Vulnerability. 4 in 5 businesses fails before they reach their fifth anniversary. While not as widely documented, many businesses fail following expansion. For this reason, it is important not to fear growth, but to time it only after your current operations are set in stone. When your clients are stable and happy, your incoming cash always exceeding your outgoing, your staff trained and efficient, and your operations dependable and steady, this is the time to expand. Expansion is inherently risky. It’s a lot harder to get right than it is to make your current situation work better. So look at the future as that which is unknown. Double down on that which is known, and you’ll be able to expand into the unknown with a much greater chance of success.
If you bring these two mindsets into the way your business prepares for the future, you are much more likely to survive whatever tomorrow brings. No ones knows what the future holds, but preparation gives you a lot more opportunities to get it right. Keep your business above board by preparing for the future in the here and now.