You feel good.
Business is happening. And it doesn’t feel like that lonely start up isolation anymore.
It feels like consistency, predictability. You’ve filtered out the noise and have your business legs ‘under you’. You’ve stopped having conversations that feel overwhelming and dead end. You’ve got a clear picture of what the business is and what the daily rhythm is. You’re focused. And that’s the problem.
You’re on rinse and repeat . . . .
What you’ve actually done is reach the point of ‘shell operation’ – the friction is minimized, the cocoon around your business feels safe. And ease risks a false positive: where daily business lulls you into thinking you’ve got growth.
You’re good. Or at least you feel good.
In turns out, some friction is the very thing that tells you when your systems have drift and where you need to adapt, need to grow out of that ‘shell’. You have to get comfortable accepting that once you reach ‘shell operation’, it’s time to start looking for friction.
That’s right, friction doesn’t come find you – You go find it.
In my business, I had a view about our pricing that was informed by data, by customer insights, by a three-tiered tracking grid of competitors we’d watch carefully. Solid foundations. At the sales and operations level, growth was smooth. I was confident in model and system – for that phase.
But fast forward a few years later – when my team began raising concerns that our pricing strategy was no longer easy, no longer frictionless at the operations level. I gave them genuine engagement. I had seen small anomalies in the data, customer feedback, and competitor behavior, but nothing akin to a ‘red flag’. I could have said ‘nah, I’m the expert and I see no major problem.’ But all that information taken together signaled that we were about to go through friction and growth.
So we broke the ‘shell’ and openly discussed how to prep the systems for shock.
Three months later, the market shifted as the Great Recession unfolded.
While others were reacting, we were ready to embrace that friction. The business had the opportunity to grow in its systems, even if the financials were soft. This was a golden opportunity to build resiliency and hand the team confidence in their business decisions. A confidence built on deep strategy and understanding.
Here’s the approach:
Assess constantly. Choose with wisdom. Execute relentlessly. Repeat.
The Great Recession was a fierce fire to walk through. For one year, we got in the trenches, held strong to our product value and unique selling position, but also flexible to solve customer and market realities. In the end, we outperformed the market (down 20%, we took a 10% hit), then aggressively got to capitalize on the rebound growth that others left on the table (return to pre-recession position with the year and never looked back. The rest of the market took another 3-4 years).
Under the ACE approach, we were better resourced, better entrenched with our core audience, and battle tested across operational systems. Cause we felt the ‘shell’, sought out the friction, and planned.
And the opportunity presented in that downtown was a window that didn’t come back. For those who made knee-jerk decisions, the recession was incredibly expensive. The kind of expensive that doesn’t show up as a line item but absolutely shows up in the multiple when you eventually sell and your metrics lag.
And these weren’t decisions that our competitors agonized over. Price cuts to make a sale are often choices that you didn’t think needed a second look.
In other words, they felt good.
So what do you do to ACE your next challenge? . . . Break the shell from the inside.
[In Part Two, we’ll discuss why good leaders misjudge opportunity and risk]
