Financial Planning | Leadership / Management

Look on the bright side; it might save your business

Thumbsup We've made the case here for economic optimism time and time again.

Now, it appears that others have started searching for a silver lining, too.

BusinessWeek's Aug. 24 and 31 cover story makes "The Case for Optimism" with an astoundingly simple, perfectly reasonable arguement: The situation is bad, yes, and we certainly have to brace ourselves for the worst ... but we also need to be ready to seize the opportunities that will inevitably come along.

"Just as the downside surprised many people, the upside might also come as a surprise to people," management expert Paul J.H. Schoemaker told author Peter Coy. "For businesses, the idea is to not get locked into the current reality, but realize that the system is quite volatile and can quickly turn. You want to have strategies that can make you win, no matter what happens."

The first step is to understand that recessions often serve as catalysts for future growth. Coy captures that idea brilliantly by writing, "Optimists see the recession as a forest fire that clears out dead brush, making room for new growth."

Anyone who has gone through that process knows what a difficult, painful experience clearing out that brush can be. The hard part is making sure you don't clear away anything vital at the same time. Eliminating the stuff that doesn't work, though, is certainly an important first step in taking advantage of new opportunities.

By the way, BusinessWeek has something for the pessimists in the crowd, too: In a sidebar titled "The Case for Pessimism," Patricia Pearson brings us back down to earth.

"Studies on 'attentional bias' show optimists err by selectively focusing on rewards," Pearson writes. "They scan the landscape and notice opportunities (and money to be made) but pay scant attention to gathering clouds. People who have endured mild to moderate depressions seem to have a clearer picture of what lies ahead. They take risks when risk is warranted and help develop a Plan B when storms threaten."

All things being equal, I'll take the optimists. When things go wrong, they seem more likely to fight through failure.

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Bill Sheridan