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5 Ways You Can Handle Your Startup in a Crisis

by Olufisayo
5 Ways You Can Handle Your Startup in a Crisis

Running a business is akin to steering a ship through unstable waters. The winds may seem to blow in your favor. However, turbulent tides can strike at any point of the journey. Crises are common among businesses of all sizes. The only thing that matters the most is the way you sail your ship to calm harbors.

In this regard, the former CEO of Intel, Andy Grove says, “Bad companies are destroyed by crisis. Good companies survive them. Great companies are improved by them.” Therefore, your concern should center around leading your venture out of the doldrums.

Moreover, the rate of business failure has plummeted by 30% in the US since 1977. This paints a silver lining to the crisis cloud, as these positive statistics encourage you to pull your startup out of the problem. Here are five simple tips for helping you lead your startup out of a crisis:

5 Ways You Can Handle Your Startup in a Crisis

1. Keep calm

Managing a crisis is synonymous with making friends with uncertainty. The friendship only thrives on maintaining a calm and positive attitude. If you fail to do so, the uncertainty will attempt to suffocate you until you almost give up. However, that is not how successful entrepreneurs roll.

       

A case in point is Mary Barra, the first female chief executive of General Motors (GM). In 2014, just two months into Barra’s tenure, GM faced a major crisis that emerged with a defect in the ignition switch. The automotive giant had to recall 1.7 million vehicles and was held accountable for numerous deaths due to the defect.

In such a time, Barra turned on her swift action mode. She didn’t panic or delay her response. In fact, she made a personal media tour and publicly apologized for the GM’s mistake. Running a successful business entails gambling with risks. However, anxiety only makes matters worse. Therefore, do yourself and your trouble-stricken business a favor and don’t panic. Maintain your calm while you work out a solution.

2. Stay focused on daily progress

Keeping calm is intricately linked with staying focused. If you run short of a composed attitude, your focus will choke until it dies. Research by CB Insights reveals that faltering attention is one of the top reasons for startup failure. It points out that lost focus is responsible for the crash of 13% of young businesses.

Maintaining your focus allows you to look more clearly at the big picture. Aim for accomplishing small daily activities instead of passing them on to your employees. This is essential to prevent yourself from entering into a state of stagnancy that lowers your morale.

A study based on 12,000 daily surveys dug out that setbacks and progress tend to influence your emotions. As per this study, small wins are critical for making the big win. Small successes reward the brain. Your fear and frustration will only swell if you sit around and wait for a mega victory that comes once in a blue moon.

       

In fact, the Fast Company highlights, Small wins matter big… Small wins signal to our brain that progress is happening and big results are just around the corner.” Therefore, focus on progressive work.

3. Optimize your team

A startup business requires a good work force like a desert seeks water. An unskilled or non-productive team contributes to the undoing of 23% of the startups. Therefore, scrutinize your team and cleanse your company from employees that don’t contribute value to it.

Hard times call for hard choices. Therefore, don’t hesitate to call the shots in this regard. Small companies invest roughly 20% of their revenue in employee wages. However, when it comes to a crisis, ensuring the efficiency of your team is far more important than saving your money. Unless your venture is on a shoestring, your chief objective should be ensuring that only bright and productive minds share the helm of affairs.

For instance, marketing is essential for the survival of your startup. To this end, make sure that your marketing team is creative. Instead of investing in more, make use of the available resources such as Mortgage Marketing Ideas for Loan Officers if your business is planted in the loan provision field.

4. Take quick but careful steps

When a problem is diagnosed, your responsibility as an entrepreneur is to get to crafting a well-fleshed strategy. This requires utmost focus minus any panic. All options should be put on the table and weighed adequately.

       

Seek your team’s assistance during this phase. The likelihood of finding a good solution is high when everyone puts on their thinking caps. Additionally, you will also be able to see better loopholes in your strategy. Try to reach to a conclusion in the shortest time possible.

Remember that time is of the essence, therefore, once an action plan is chalked out, don’t dilly-dally. Another thing to keep in mind is that some crises demand an immediate response. Failing to do so comes across as incompetence. This might also be taken as indifference. Both of these problems only aggravate the issue. Hence, work in a smooth and swift manner.

5. Give priority to projects that generate revenue

Navigating your business out of uncertain waters involves prioritizing revenue generation. You don’t need to invest your time, resources, and productivity on projects that may or may not reap in the coming years.

Instead, concentrate on projects that churn out revenue, as these keep your startup afloat. Put your best in these projects and delegate your team’s productive men to them. This strategy has proven to work for successful CEOs.

Steve Jobs, the father of Apple, followed just this policy when the tech mammoth was at its lowest. The company was producing products that made no substantial revenue. It was during this time that Jobs cut back all the projects and pursued the development of the iPod. It was this project that saved Apple from sinking and made it what it is today.

       

Key takeaway

In a nutshell, steering your business out of a crisis is a challenging process. It is a sink or swim situation with no guaranteed results in sight. Under such circumstances, panic is common, but it is also the enemy that poisons your focus and attention. Thus, manage your anxiety and don’t panic.

Maintain a calm and positive perspective that helps you stay focused. Craft a quick counterplan with the help of your team. The more the voices, the stronger the critical eye that picks out faults in a plan. During all this, ensure that you have a productive team backing you and concentrate on projects that yield revenue.

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