Short term long term

September 30, 2009 - Is Short Term or Long Term More Important?

Main Idea

What were you thinking when you got engaged?  Was the time period the next 60 days or did you think about the rest of your life?  When you started your current job or started your business, was your time horizon two weeks or ten years? 

Expansion of Idea

The current economy dictates that we watch the business and legal environment very carefully.  We have to manage carefully cash and debt and receivables and a lot of different things that are very short term focused.  The main problem is that we can be consumed with the tyranny of the urgent.  We lose sight of where we are going.  Or we lose sight of our employees or customers.  We have to balance our short-term focus with a long-term view. 

Last fall there were a number of fashion shops that cut their prices and probably forever destroyed their brand.  Yet, Giorgio Armani completed a brand new store on Fifth Avenue in Manhattan.  This store probably cost $40,000,000 to complete on one of the most expensive retail locations in the world.  This was also in a town that was decimated by the stock market crash.  Mr. Armani might be completely nuts, but he was quoted “An entrepreneur shows his true colors in a period of crisis, not in a period when everybody is having success.  Understand that the investments that I made in this store I will probably not get back for twenty to twenty-five years.”    He was 74 at the time.  This might be an extremely long-term view. 

How many companies cut employees and then training budgets when faced with cash flow problems.  Employees are expected to handle more without the right training.  Major companies cut research and development in these times.  What they really have cut is their future.  With all of the upheaval in business, you are determining your future right now.

Start by Asking Yourself these Questions:

  1. What is critical for you to do now to insure your future?

  2. Do you have a plan for investing in the future?

  3. Have you cut service levels? 

  4. Should you add service?