Turning Uncertainty Into Opportunity is Nothing New for
Women So Let’s Do What We Do Best
A few years ago the Managing Director of the International Monetary Fund Christine Lagarde said women led in a crisis better than men. In an interview with Harvard Business Review, she talked about opportunity. “When the situation is really bad, it’s a good occasion to prove yourself,” she said.
Our takeaway: Women aren’t afraid to step up. Women are focused on fixing the situation. End of story.
It’s prudent to remember where we’ve come from. The very origin of NAWBO back in 1975 was born from a crisis of inequality. Founding President Susan Hagar said: “Get a seat at the table or build your own table, and make sure to include other women.”
On the home front, women have reined in uncertainty for millennia. We are oftentimes the rock of our families and a stable voice in challenging times.
So how do we take the uncertainty of our times and reshape it into opportunity for our businesses?
Meet Carolyn Booth. She serves as executive vice president and head of business banking at BMO Harris Bank. Her advice: Start with your advisors – your lawyer, your banker, your accountant – to create contingency plans that prepare you for multiple scenarios in case of economic falls, times of uncertainty and emergencies.
“These can save business owners time and allow for them to act immediately,” she said and suggests reviewing your contingency plan every few months to make any necessary changes.
If you are uncertain we’ve entered an age of uncertainty, here are proof points. CNBC just announced that the recent presidential election has proven more "tumultuous" than the 1987 stock market crash and the 2008 recession.1 And then there’s the Economic Uncertainty Policy (EUP) Index created by economists from Stanford, the University of Chicago, and Northwestern. The EUP Index this year has been running above the long-run average of 110.
“It’s not surprising that the Economic Uncertainty Policy Index is indicating a certain unsteadiness,” said Booth. “The question is what do you need to do to manage through tumultuous times? In addition to creating contingency plans, you should also reinforce the foundation of your business by keeping customer loyalty strong.”
She advises making this a regular practice – even when times are good. To illustrate her points, here are her examples: “During uncertain times it is important to remind your customers that you will always provide them with exceptional service – without your customers your business will struggle. For example, at BMO Harris, customers are at the center of everything we do and we show that by ensuring every customer knows who their key contact is, contacting customers proactively and regularly, and having valuable in-depth conversations.”
Elaborating further on the EUP Index, Booth says that, in general, economic uncertainty consistently ranks high among business owners, particularly privately-held businesses.
“Your responsibility of balancing the risk of your actions and the reward of achieving your goals is underscored when the direction of the greater economy feels ambiguous,” said Booth. “During times of uncertainty, given our biological aversion to risk, you are naturally more mindful of the business decisions you make and how the downside impact can affect your life and the lives of others.”
That primal urge to defend reverberates through business decision-making. She commented, “This may cause you to delay investments (i.e. capital investments or expansions) if the pathway to an improvement in revenue or earnings seems less probable. You may choose, instead, to focusing on reducing debt, building liquidity or shoring up access to additional capital. It might even cause you to delay your plans to transition the business to the next generation and spend more time on improving the knowledge base of your team and reducing known weaknesses within your operations. Cautious behavior during stressful times is normal; yet you have to be prudent to ensure you don’t stifle emerging progress.”
We all know Ben Franklin’s famous quote: "In this world nothing can be said to be certain, except death and taxes.” Debatable. As women business owners, we have the power and influence inside of us to power through. Booth concurs. She says that when you take steps to be prepared and work with your advisors to make sure that you are covering all bases, you will be ready to weather any storm. “It is better to stay one step ahead of the game by expecting the unexpected,” she says.
Besides, uncertainty often leads us to find solutions we wouldn’t have thought to explore otherwise. Booth underscores the value of paying attention to the weaker areas of your business during times of uncertainty, increasing the company’s ability to withstand a real downturn in the economy.
“This may include diversification of your customers, review of your vendor relationships or deepening your bench of trusted advisors. You may uncover that others in your network can provide tactical steps to help your business, based upon reflection of how they handled their own difficulties in the past. This level of transparency and business consciousness is a great reward, despite the feelings of uncertainty,” she said.
Bringing it closer to home, NAWBO asked Booth what resources we have for women leaders in Chicago to help turn uncertainty into opportunity.
Booth points out, “There is a concerted effort, based on the historic underrepresentation of women in business and related resources, to ease the unique concerns that women face. Women have a great opportunity to tap into these supportive communities to share their individual trials and successes and find comfort from people who can empathize and strategize with them. Organizations such as NAWBO, WBDC and WiSTEM – 1871 (Chicago-based Women’s Entrepreneur Program) are a few great examples of the supportive communities available to help.”
1 Trump economic 'uncertainty' worse than '08 financial crisis levels, index shows, May 18, 2017, http://www.cnbc.com/2017/05/18/economic-uncertainty-index-surpasses-08-financial-crisis-levels.html
You’re invited to attend
“A New Era: Creating Opportunity in Uncertain Times”
June 13, 2013, 4 PM – 6:30 PM
BMO Harris Bank, 8th Floor Auditorium, 111 West Monroe Street, Chicago
Nicole Lapin, financial journalist, TV news anchor, author and businesswoman,
Michael Gregory, CFA Deputy Chief Economist and Head of U.S. Economics.
Advice from women leaders - Networking - Strategic planning for the future
MEET NAWBO CORPORATE PARTNER: BMO Harris Bank
“We all have heard that companies with more women board directors experience higher financial performance. There was also a study earlier this year stating that firms with more women in the C-suite are more profitable. That’s not a coincidence. When women feel supported in business they often pay it forward by helping others, thereby increasing the confidence and pipeline for future women business owners. BMO Harris Bank is very proud to support NAWBO and all women in business.”
About: Established in 1882 as Harris Bank, and owned by BMO Financial Group (TSX, NYSE: BMO) since 1984, BMO Harris Bank has grown to become one of the largest banks in the Midwest serving personal, commercial and affluent customers. Its focus: “building relationships with a vision to be the bank that defines great customer experience.”
111 W. Monroe Street
Chicago, IL 60603