Main Idea
Have you ever done anything in the heat of the moment and then 10 minutes later or 10 days later you regretted it? Do you have a process to test your decisions and see if they make sense from everyone’s perspective?
Expansion of Idea
On the front page of the Wall Street Journal a few weeks ago, there was an article that discussed Saks Fifth Avenue and their actions during the Christmas shopping season. The gist of the article explained why they slashed their prices to a ridiculously low level. The main reason was to beat their competition. The problem with this is that their suppliers were very upset because Saks changed the fashion designers brands. In addition, they totally changed their business model, probably for a long time.
Most retailers did something along this line. I am not going to judge whether or not it was the right business move. I do not have the facts. But I do want to talk about the impact that these decisions have on our business model and our branding. Our branding is something that most of us do not spend enough time on because it is an intangible. It doesn’t show up as cash in our bank account in the next week. Our branding is our identity as business people and organizations. It is what we are selling. Our decisions and actions during these uncertain economic times can frequently change the brand and ultimately determine our future. It doesn’t do much good to cut customer service levels so that you can limp through the current situation and at the same time lose customers whose lifetime value could be hundreds of thousands of dollars.
During times like these, it is critical that decision making go through a process to evaluate the effects and actually be part of your longer-term plans. We have to get away from strictly reactive decisions and become more proactive in our decision making.
Suggested Areas to Start
Define your process for making key decisions.
Add customers and employees, if necessary, to provide filters.
Evaluate recent decisions and see if they could be handled better.
Communicate with your team.