In celebration of Forbes’ 100th anniversary, Forbes magazine issued its special collectible centennial issue, which includes quotes, lessons, ideas and thoughts about the future by the top 100 Greatest Living Business Minds. It is important to note that the selection process of the people on the list took over two years. One of the names on the list is the name of the famous founder and CEO of Spanx, the extraordinary entrepreneur Sara Blakely.
For the special Forbes issue, Sara Blakely shared her thoughts on one important for every entrepreneur and business owner topic – due diligence. She shared that in the early days of Spanx, one of the company’s key manufacturers went out of business giving her only a week notice. This major setback almost killed her business. Luckily, for all of us it didn’t.
Blakely shares that from this experience she learned a valuable lesson – due diligence matters. If she had done financial due diligence of her manufacturer, all of this distress would not happen.
There is only one thing in entrepreneurship that is certain – there is no certainty. At some point, all entrepreneurs have to deal and manage a business crisis of different scale and variety. There isn’t a formula to follow when it comes to handling these crisis situations, yet there are certain approaches that can be embraced in order to minimize the negative effect of the situation.
The due diligence that Sara Blakely advised us on is one of these ways. Here are three other approaches that you can embrace that can increase your chances of surviving a crisis.
The most effective way to handle something is to be prepared for it. While it is impossible to predict the occurrence of all crisis situations, you are able to take into consideration different scenarios of things that can go wrong. When you prepare for future crisis situations, it is possible to notice numerous signs that show distress, which otherwise you wouldn’t notice. It is better to be aware of your weaknesses than to ignore them.
The spider-web effect
Crisis doesn’t occur only in one area of the business – they usually spread quickly in the whole organization. When one of the processes is challenges, it is just a matter of time other processes of the business to experience some difficulties. Embrace strategy that gives you the flexibility to isolate one aspect of the business from the other.
Communicate the issue
When there is a crisis, your team should know about it. Anyway, they will be able to sense that something is wrong, it is better to put the cards on the table. But make sure that you present the information carefully without to cause panic. Be honest with your team members, your partners and your investors – they will be all happy to help.
Whatever the issue is, try to stay calm and focused. In the end, a little challenge can present to you numerous lessons and opportunities. Embrace them!