Small Business Taxes & ManagementTM
In order for companies to be successful, executives need to understand the value of staying calm during a crisis situation. When an economic or public relations crisis hits your company, your first reaction may be to panic. But when you have the right kind of support system in place via planning, a great staff, and insurance (you can browse quotes at BusinessInsurance.org) you can withstand any crisis regardless of how difficult it may seem.
There are five things every business owner or executive should know when it comes to keeping your cool in a crisis. It helps to have a stress ball on your desk to squeeze when things start to go wrong. But for a real solution, nothing beats being prepared.
Business Planning. Small business owners often forget to put together a business plan when they are starting out. A business plan is a the comprehensive blueprint you use to run, grow and finance your company. Just like any good plan, a business plan also has a section that is dedicated to reacting to a crisis.
A business crisis is something that takes up your company resources. You should never use resources unless it fits the business plan. When you create your business plan, put together sections on options during a crisis. When a crisis occurs, you have a head start on getting yourself out of it.
Surround Yourself. The first thing a good business owner should do in times of crisis is surround himself with good people. It is important to avoid surrounding yourself with "yes" men or women that will only tell you want you want to hear. That will do nothing to help you come up with good answers. You need people you can trust that will give you good advice.
You should also surround yourself with the right kind of professional assistance. If your company is having economic problems, then hire an accountant. If it is a public relations issue, then hire a public relations firm. Contract the people who have the know-how to help.
Hit it Head On. The most common response to troubled times is to hide from it and hope it goes away. That is the wrong approach. When a crisis hits your company, then you need to meet it head on and address it immediately. Create a written evaluation of the situation and see where the problem originated. This will help you to solve the problem more quickly, or at least allocate the proper resources to get the issue resolved.
Restrict Access. If your company is having financial problems, then lock down your books and access to all financial tools such as credit cards and your bank account. Some people tend to take advantage of a crisis situation, which can only make it worse. Restrict access to the important elements of a crisis and make sure that only you know what comes in and what goes out.
Business as Usual. It is important that you maintain business as usual during a crisis. Of course, you may run into some situations that would make that difficult. For example, a financial problem may mean that your vendors are not extending you the credit that you need to get materials. In that case, you will need to find alternatives.
Maintaining business as usual gives you something else to think about to help get your mind off the crisis from time to time. It also helps you keep your company afloat and make sure that you are still in business when the crisis is over.
Troubled times require precise responses. When your company hits a rough patch, be sure you are prepared and can handle the problem efficiently.
This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Articles in this publication are not intended to be used, and cannot be used, for the purpose of avoiding accuracy-related penalties that may be imposed on a taxpayer. The information is not necessarily a complete summary of all materials on the subject.--ISSN 1089-1536
--Last Update 05/02/12