Are you Paying Attention?

Are you paying attention? How many times have you heard your mother, your teacher, your coach, or your spouse ask that question? It’s an indication that something important has been shared and an expression of their concern that you might have missed it.

We have a new President, a financial crisis of monumental proportions, government ownership of banks and automobile manufacturers, clean energy initiatives with solid backing, and a real chance that health insurance and health care are going to be altered to yield something that looks a lot more like universal coverage.

I don’t know what you do for a living, but as a semi-retired person who has considered himself to be out of the fray—with an inflation-adjusted pension and some investments—I’m paying close attention. It’s hard for me to imagine a personal situation that is not going to be impacted by the things I’ve mentioned in the second paragraph.

For my wife and I, the decline in our investment portfolio has meant taking a serious look at our discretionary spending. We’ll be taking fewer trips to visit family and cutting back on eating out. Health insurance costs may be going up, my house isn’t worth as much as it was two years ago, and I doubt that the bank is going to be supportive of a bridge loan if I want to downsize into a house with a master bedroom on the main floor—which means I’ll have to sell this house before I can take the next step.

I consider myself semi-retired because I do consulting work. I find that businesses are doing the same thing with their budgets that we’re doing with our household finance. They’re cutting back on discretionary spending, and although I like to think that I add value with my workshops and other services, it is obvious from the cancellations and delays that many firms are rethinking their priorities.

One of the financial columns I read talks about “The new reality”. The point the author is making is that things aren’t going to go back to where they were before. Smart investors need to stay abreast of the changes and adjust accordingly.

There is a process to help cope with all of these changes. Done properly, it is even possible to get a leg up on your competition and use “The new reality” to your advantage. The process is called reinvention. I like to break reinvention into two parts, which I call big reinvention and little reinvention.

Little reinvention is primarily process focused. It involves making incremental changes that increase the efficiency and productivity of your enterprise. Surveying your customers—patients in a medical practice, for instance—to see what that like and what they dislike about the totality of the service you provide can give you the information you need to make incremental changes: Shorten up the check-in procedure by adding another receptionist.

Big reinvention occurs less frequently. It is the appropriate response to “The new reality,” to a paradigm shift. Big reinvention involves changes to your enterprise’s strategies and tactics. Failure to adjust to “The new reality” can be fatal: just ask Chrysler and GM.

Where does reinvention start? It starts with paying attention. Healthy organizations reinvent themselves by training people at all levels to be aware of what is going on inside and outside their normal boundaries and establishing a re-occurring process for drafting and implementing changes.

Financial meltdown; health care reform; alternative energy initiatives; government ownership: Are any of these impacting you and your organization? Are you paying attention? And what are you doing to address the changes?