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By Wayne Rivers
February 29, 2020
I once heard a speaker quote a fascinating statistic: 80% of the climbing deaths on Mount Everest occur on the descent! What does climbing Everest have to do with operating a construction company? More than you might think.
The same four elements which increase the danger of an Everest descent—exhaustion, euphoria, planning, and relaxation—also apply to running a business.
Exhaustion Running a successful firm for five or 15 or 35 years is an absolute recipe for exhaustion! Many leaders, whether they're willing to admit it to themselves or not, are suffering from years of mental and physical stress, fatigue, and even burnout. Tired people make mistakes, and none of us is immune from this fact.
Euphoria With the construction economy booming, many leaders are giddy with their new heights in volume and profits. Because of their euphoria, they don’t see challenges looming before them, and they may be slow to plan. Euphoria can easily morph into fear and loathing. Even in boom times, there is lurking danger for contractors: that big project is canceled; you lose one or more of your best people; that easy job with big margins turns into a loser, etc. Don’t let today’s success blind you to tomorrow’s challenges.
Planning Construction leaders are conditioned to always plan for growth—the ascent, in other words. It's hard for them to get their minds around unseen challenges or setbacks. Since most of their planning muscles are developed to contemplate growth (the way up), they may not have quite the same capabilities for planning for downside contingencies. Worse, they may have stopped planning altogether due to the “hurry up” nature of construction projects and the strong economy.
Relaxation Many construction leaders have become relaxed to the point of complacency. They rationalize, "Business has been so good, and we’re bigger and more profitable than I ever thought we’d be. We’re in a position to turn this company into a marketplace juggernaut! We don’t need to make any changes at all; we just need to keep doing what we're doing.”
If these kinds of sentiments have ever been uttered under your roof, they are dangerous words indeed! It's all too easy, when business is good, for us to believe in our own press clippings. Running a business today is as challenging as it's ever been, and complacency resulting in a failure to objectively and critically analyze your strengths, weaknesses, opportunities, threats, and barriers could foretell struggles in the years ahead.
Don't fall prey to the “death on the way down" statistic! Now more than ever—for reasons like a potentially softening economy, accelerating technological changes, increasing regulation, and ever-intensifying competition—contractors need to plan, renew, and reinvent.
Wayne Rivers is the president of The Family Business Institute, Inc.