Max Gunther’s “The Zurich Axioms” outlines a set of principles purportedly employed by generations of Swiss Bankers to make them lots of money. Twelve major axioms underpinned by 16 minor, including “Always take your profit too soon”, “Chaos is not dangerous until it begins to look orderly” and “Disregard the majority opinion – it is probably wrong.”
Warren Buffet famously applies a simple-sounding set of principles to all his major investment decisions, from “invest in what you know”, to “look for businesses with big moats around them”.
Having and using a set of guiding principles – rules of thumb, heuristics, statements of truth or even homespun wisdom you can fall back on as a guidebook when things feel confusing or blurry – is a time-tested approach of leaders, politicians, sporting franchises and performers the world over. It’s more than your values – those one word representations of your ethos, your attitude. It’s a sentence, a phrase, it can even be a hackneyed cliche to others (but important to you). A line you can pull to front of mind or read, then reflect on how powerful the “rule”, “law” or approach has been for you or others over the years, and that you can then employ to shape the call you’re about to make. The All Blacks "Sweep the sheds" kind of thinking.
If you’re in a business that’s navigating tough times – and there are many, always – here are ten principles that might be worth considering, to get you started. They're largely garnered from observations, personal experience and the hard-won learnings of others. They're very high level, and a starting point. You might reword them, and you might have your own, better for you and yours. If not, try these.
- The experience we give our next customer will shape our future.What you’re willing, ready and able to do in the service of the needs, wants and desires of the next person to walk through your physical or digital door? Speaks volumes about your culture, your systems, your value proposition and your approach to being a choseable business of tomorrow. If you’re doing all in your power, resource kit and bottle to optimise their experience, from functional effectiveness, to silk smooth efficiency, to bringing about dial smiles and inspiring a thirst to come back? Then you’re on a half-decent path to remaining relevant and valuable. But if you’re relying on unspoken ways of old, or muscle memory, the kindness of strangers, or have built up in your mind that they need you more than the opposite? You are creating a future problem for yourself that will get harder to fix the longer you leave it.
- Profit has lots of dials, but they’re all connected to just two levers.Money in and money out. If the former is proving increasingly difficult, or you can’t see a path to making serviceable investments that inspire you with confidence in an appropriate future payoff? Then easing back and being hypervigilant, even austere with what you put into the organisation, or what it outlays, might be both appropriate and necessary. That might mean reworking the business model, temporarily or until the uncontrollables work once more in your favour. Leaner may give rise to more sustainable, or at least tell you what's essential and what you can leave out. But as with anything, there are limits. If yanking the spend back in one area creates an aligned or even greater reduction in revenues (or perceptions in your ability to re-rail in nicer climes), that won’t do. If you’re unsure, invest in the advice of a financial levers professional to guide you. If neither lever can seemingly be moved in the right direction? Then there’s a clear choice on your plate.
- From the compelling to the unpalatable, there is always a choice.Even if it’s close the door, walk away, and go respond to the myriad paid opportunities out there on SEEK. ?Death and taxes might be unavoidable, but how you respond to the next challenge or opportunity that presents on your countertop? There is more than one way. Even when it’s not obvious. Make it a practice, a discipline, to identify at least two choices, even better, three, for each scenario. Bring in others to be the foil to your myopia if you’re just too close to see it. Gift yourself the learnings of comparison, of something you have to choose scales for in your head (be they cold hard commercial indices or values-embodying culture tests). Don’t accept the first or most seemingly right call without at least considering that there are other ways, and they’re rarely ever without some merit.
- Prices have to be to paid, so clarify and reconcile them early and repeatedly.There are consequence cascades attached to every decision and action, down-the-line things that are often imaginable, predictable or likely. Thinking about what they might be before pressing the big green or red buttons gives you a sense of the sort of future decisions you’re going to need to make, and what it’ll likely cost you, or close off to you. You can’t see or know them all, nor avoid them all, and some you will just have to live with or respond to as and when they present. The earlier you get your head around the anticipatable ones though, the more prescient your decision is likely to prove, and the more sustainable the cascade you created.
- Trying something gives you a data point to inform the path to “better”.“Do something!” cried legendary Hawthorn Coach John Kennedy. We don’t know if it will work. No-one has a forward-moving time machine, so it’s just pattern-interpreting best guesses. Waiting for calmer waters just tells you about your aptitude for treading water. Collaborating, creating and testing something different not only signals a proactive, even innovative mindset, it will give you some form of result to learn from and build upon. You needn’t put it all on a random 14 red, close-your-eyes-and-hope call. Arm the “try it” decision with bright thinking, temperature tests and the context of your start and destination points in the prevailing breezes of your market. But it’s generally less scary being busy working towards better, than it is sitting, waiting (and it generates more for you to shape).
- Generous positivity consumes energy that the right recipients will top up.In glum periods, the desire to be selfish and dour can be strong. Take it the other direction though, and you can affect remarkable change and ripple effects. But pay attention to where you spread the good vibes, and who’s sucking it up like a voracious black hole, and who’s giving back gratitude and pay-it-forward signals. Giving can be the best kind of medicine in tough times, but it needs a feedback loop of some type to renew the energy it takes to be the sunshiney one. Don’t be stingy and dole your nice out via strict criteria and ironclad promises of reciprocation (defeats the purpose). But if you find your generosity getting abused? Point it elsewhere for the magnification and sustainability benefits it can have with the right humans.
- Decisions made purposefully appreciate over time.If you are clear about your enterprise’s “Why”, then use it as a filter for the big calls. Ask yourself “will the path I’m about to select, big or small, help me in some way to fulfil this purpose, or get better at, or closer to, the kind of benefits I set out to make?”? Connect the dots. Even if the tactics prove wrong with the passage of time, the intent and the message it sends out likely magnetises the right kind of future contributors or supporters. And it gave you a judgeable measure that means something to you and those you seek to help. Quietly confident you’ll be ok with calls like this 20 years from now.
- The system needs the flywheel, and the flywheel needs the system.You can’t do it alone, no matter how much you elect to shoulder the responsibilities and streamline the org chart. At very least, you need customers, and you have to work with them, interface with them, in an ever-more systematic way, if you’re to realise future benefits of economies, efficiencies and effectiveness. You’ve got to first put the energy into the interactions – start things in motion - but pay as much attention to how the mechanics of your interactions work as the catalysing actions, because unnecessary frictions will quickly grind your energetic starting point to a useless halt. A well placed drop of oil and an interlacing of neatly aligned moving parts fed by a spring can carry you and the value of the engagement so much further. Focus on "again" more than "once".
- Specialists and utility players have proportionate value and application risk.Sometimes, you need the deep technical expertise and the wizened experience of a master to go to work on a very specific situation. Sometimes, you need the flexible can-do MacGyver mindsets of those comfortable navigating foggy, still-emerging discomfort with nothing but gaffer tape and cable ties. Putting one into a situation that requires the other can blow the whole joint up, not to mention kill their desire to stick around. Understanding capability depths and breadths, appetite and ability measures in different categories of risk, is really important in an uncertain and unfolding future. Both have immense value in the right moments, both will help as you vacillate between “know precisely what to do” and “no idea”. You just need to understand who is what, and when the timing is right to deploy (and remove) them. Curating a crew with a bit of both? Smart and risk balancing.
- The more you love it, the longer you’ll labour and the lighter the load will feel.A paraphrasing of the philosophy expressed by Steve Jobs (“You better love it, or you’ll fail, because it’s hard.”), if you’ve not picked a gig, a purpose, a vehicle that you truly deeply love (on at least 4 out of 5 days), then why are you wasting a life you can go live in another better-fitting lane? The pressures rarely disappear, they just change shape, colour and direction. So you’ll never be skiing on completely glassy waters, not for long anyway. Living with and embracing the chop, and your ability to get through it, and the satisfaction dealing with the tough stuff can give you? That’s got to be part of the love. Then it’s more of a provocative challenge than a crippling burden.
These are just a few I think have merit considering at the three-ways of big business decisions, particularly for SME leaders. You might have others you believe more deeply in or have seen play out consistently to the point you'll call them a principle. What are your overarching business principles – the ideas, the learnings, the rules of thumb that you and yours have, can or will employ to guide your decisions and fall back on when it’s too befuddling? Have you articulated and unpacked them recently, together, as a team? Can the team help you shape them for your enterprise as it readies for its next stage of life?? Can you print them, hand them out, posterise them, talk about them regularly? They’re not necessarily the answers to the test. But when it’s tough and confusing?
They can help illuminate the junctures and the paths that lead from them just that little bit more brightly.
If you want a hand pulling the crew together to create some guiding principles for your strategic decisions, just ask. It’s what we do.
Troy Forrest, Strategy Road Pty Ltd, 11th March 2024.
