Business isn’t for the faint of heart.
There are tons of ups and downs.
The high times can be wonderful, the low times can be really low. They can crush you if you’re unprepared to handle them.
It’s often said by some of the best that the smart entrepreneur will plan for bad times during the good times and for the good times during the bad times.
The natural tendency, it seems, is to do the opposite. We plan for more good times when things are good and we plan for more bad times when things are bad.
One thing I see in business (and in personal life as well) is crippling fear.
We worry about what might happen and it leads to a paralysis of action.
We are so afraid that we’ll make the wrong decision that we make no decision at all.
Don’t get me wrong, sometimes in business the best deals are the ones you don’t make. But you can’t count on that to be right all the time.
There is also a saying in life that if you’re not moving you’re going to die. Flowers, for example, are either growing or dying. There is no static.
I live in Wisconsin so this next example is common: deer in the headlights.
If you have ever encountered a deer at night on a road it’s really strange. Deer will walk onto the road and look at your headlights and freeze. I don’t know if it’s crippling fear, but the action is the same.
Fear of failure. Fear of making the wrong choice. Fear of what might happen.
It can cripple you…but there is something you can do.
Worst Case Scenario
I find that this works well for business when things are going well and when they’re going bad.
Let’s say that you’ve been going along for awhile. Think to yourself:
What would happen if I lost my biggest client tomorrow…
It could happen. That might be your current worst case scenario.
Obviously it’s not a pleasant thought. But successful people that I’ve read and listened to often use this tactic. They think about the worst case scenario. Then they start playing out the future in their minds.
They start forming plans of attack to get back to where they were. They think about strategies for getting another client. Then another. They even take early action on some of those plans.
And the exercise also helps you mentally deal with the worst case. Often, the worst case scenario you can conjure in your mind isn’t that bad.
And you can come away with a plan of action, which keeps you moving forward instead of getting locked in the paralysis of inaction.
Let’s say that you have just lost you biggest client. The worst case scenario has already happened.
Don’t think about a plan of action just yet. First, go through the fallout from this worst case scenario.
Your income drops. You have to fire your staff. You have to break your office rent contract. Maybe you have to sell your house and cut back on expenses.
Certainly not good, but not necessarily the end of the world.
Gary Vaynerchuk says that one reason he feels he’s been successful is because he knows what it’s like to have nothing and he’s not afraid to go back there.
There are two big takeaways from this exercise.
First, you prepare for the worst that could happen. Instead of living like good times will continue to roll you prepare for downfalls. Even if it’s already happened you can find ways to work back toward the top.
Second, you can often realize that the worst case really isn’t that bad. You can live with it. You don’t have to sit and brood. You can continue to find ways to move forward.