The real danger with a loudly-trumpeted, common crisis, like the recession, lies in the fact that this problem can become a convenient excuse for professionals and businesses.

The current economic downturn does not automatically account for everything that may be wrong with a business. Media concentration on the recession distracts business owners, entrepreneurs, and professionals from short-comings and root causes, which may be part of their business, either because of, or in spite of, the recession.

During the boom, some businesses did better than others; the same is true during a recession. What if the recession is not the only source of lost revenue, declining market share or vanishing customers?

Productivity, product design, customer engagement and service delivery are a few of the areas that usually include overlooked room for improvement. Mis-directed or unfocused communication adds further complications. During boom times, a "don’t fix it if it ain’t broke” attitude may allow deficiencies to be ignored. Now, every customer matters. The revenue generated by each customer is significant. Satisfying customers, attracting new business, increasing market share and managing costs are four important goals for thriving in a tough economy, and for gaining the advantage when good times return.

Use the term "recession” to identify specific areas for concern, or growth, in your business, and you’ll find this economic concept is too vague to reveal concrete opportunities or solutions, beyond cost cutting. The most practical growth-based analytic approaches centre on those who drive your business—customers. For instance, cost-cutting measures may erode product or service features or benefits unless customer-centric thinking is carefully applied.

Howard Grosfield, Vice President and General Manager, Small Business Services American Express Canada & International (AmEx), emphasizes the importance of knowing your target customer. For AmEx, that’s business owners.

"Small businesses are a driving force within the Canadian economy and they rightfully expect more services and better support from financial institutions,” said Grosfield, explaining that AmEx attempts to demonstrate the value of learning and analyzing target customers’ needs and challenges in every aspect of its business.

"We have built a product from the ground up designed specifically for Canada’s 2.3 million small business owners. This card provides a truly differentiated offering with the rewards and services business owners want on a single card.”

Grosfield stresses that inspiration for product and service design starts with the target customer. AmEx invests considerable time, informally and formally, understanding and appreciating its niche within Canada’s 2.3 million small business owners. By analyzing each industry and profession—construction, travel, advertising, plumbers, electricians—AmEx learns how the target customer can benefit from a service. The process involves solid research until a core concept, which should resonate with the target, emerges. Next, a prototype is created and presented to target test groups for feedback.

Did you follow a similar process in developing products and services? Or, have reactions to recessional stresses forced redesign and redefinition of your offerings, without careful consideration of how customers feel about these changes? If you’ve squeezed in research, analysis and testing as expenses were reduced, your products and services are probably on solid ground. If decisions were driven by your sense of urgency and need for cost-cutting, quality and relevance may have suffered.

Grosfield emphasizes "ongoing over-investment in getting feedback from customers.” Do you know what your customers really think about your business?

Wait for governments or banks to reverse small business fortunes and you may wait forever. These dynamic businesses are on their own when it comes to improving their lot in any economy. "I don’t think [small business owners] overlook a whole heck of a lot,” said Catherine Swift, Chairwoman, President and CEO of the Canadian Federation of Independent Business (CFIB), explaining the greater stability in independent businesses, compared to their publicly-traded corporate counterparts.

"One thing about this particular downturn: we have had about 15 years of growth, in one of the longest periods of growth without a downturn, which means businesses, in general, will be better situated, with more resources to draw on.”

Small business resilience also stems from policies which focus on growth and longevity, not maintaining shareholder profit standards. For instance, publicly-traded companies with large workforces, often consider employee layoffs as cost-cutting measures to buoy up the bottom line. Independent businesses understand the value of experience and knowledge, and frequently adopt long-term views of employee retention.

"We know that one of the big problems before the downturn was shortage of labour, which was a huge issue, and, because of demographics, it will continue to be a huge issue,” said Swift, who credits owners with positive post-recession vision when it comes to skilled employees.

"Small business owners may not be just looking short-term. This may be a time to snap up talent, which is getting freed up and that demographics will free up. Businesses that do get through the tough times, tend to be very well positioned once we get going again. They will be in better shape and can just rocket.”

Published: December 30, 2008

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Futurist and Strategist PJ Wade is "The Catalyst" - intent on "Challenging The Best to Become Even Better." PJ earned this title by translating the dynamic impact of Boomers and their multi-generation families into relevant insights that start people thinking and taking action—in business and in life. Author of 8 books and more than 1800 published articles, PJ encourages individuals to become their own futurist. PJ writes and speaks about the insight, knowledge and solid decision-making skills that professionals and their clients need to live and work in this vortex of change. For instance, since PJ knows that home is headquarters for the new decades-long "unretirement," she wrote the popular book "Reverse Mortgages: Best Friend, Worst Enemy...Your Choice!", which is filled with suggestions and cautions on protecting, building and managing home equity. Her new business book, "What's Your Point?: Cut The Crap, Hit The Mark & Stick!" will be published in 2012. As The Catalyst, PJ provides strategic communication, client appreciation and advanced education services to the financial, tourism, lifestyle and service sectors - and the clients they serve. A frequently-quoted financial and business commentator, PJ is a thought-provoking strategic speaker who offers practical, real-life suggestions on leaving "the box" behind and embracing Forward Thinking - a talent she regularly demonstrates in this column. For more on keynotes, blogs, books and information on a range of 21st-Century topics, visit TheCatalyst.com.