Something really bad happens, and you need to act fast.
It could be a horrible piece of publicity when one of your employees or subs is killed on a job site accident, your key client defects to a competitor (or worse, goes bankrupt just after you finish a major job but before you are paid), or terrorists hijack four planes and aim two of them for high profile public buildings in a market you thought you were succeeding in, and were about to expand. (For me, Washington Construction News, September 2001.)
Things happen in business and in life, and not everything is under your control.
You can plan for contingencies, but can you plan for everything?
To some extent, yes, but I would argue that outside of some common sense, you can't worry too much about the improbable or unexpected events that affect everyone. You'll be in a mess, of course, but so will everyone else around you. (And sometimes disaster equals opportunity -- I'm sure most contractors in Louisiana didn't fare too poorly after Katrina struck.)
The disasters you need to watch and prepare for are the ones which aim squarely at your own business, but no one else. These are usually self-inflicted. (It turns out I had business problems in Washington, D.C. which had nothing to do with 9/11 but were caused by my then lack of sufficient management controls and oversight of people/processes.)
Lets take the job site accident, for example. Are you observing all the relevant safety regulations, and do you have best-practices for managing and training your employees in the processes. (Skimping your safety budget to enhance your marketing is surely not a wise business decision, because when something goes wrong you will more than pay for the collateral damage.)
Is your credit and business management so loose that you would allow yourself to be caught when a major client fails, and are you too dependent on a single client, who will cause business havoc if he leaves? For the latter problem, some intelligent marketing to enhance your client diversification is as wise an an expense as appropriate insurance coverage and good safety training.
These preparations are helpful, but you need another quality to get through really bad situations. I call it a great stress instinct and am fortunate to be well equipped in this regard. When something goes wrong, I quickly figure out a response or solution, often within minutes, and get down to work.
You probably know if you have this trait yourself. If your business has been banged around by the recession and is still viable (or you lost your job in the hard times and managed to start, and succeed, at business in the current environment) you are okay.
Don't sweat the small stuff.
We're still in Washington, by the way. Issue number two of the Design and Construction Report will publish and go on line next Monday. But I have a client service crisis to resolve which I learned about at seven p.m. last night. I've already mapped out my simple and inexpensive solution.
Thursday, November 12, 2009