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This article has been translated from our English edition.
The opinions of the employees of You are personal.
Although there have been all-time highs in the stock market, entrepreneurs and small businesses around the world are facing problems. In the United States, total small business revenues as of September 13, 2020, decreased 20.6 percent compared to January 2020.
Additionally, the number of small businesses still open declined 23.6 percent from January 2020, and the number of diners in restaurants decreased 40 percent year-over-year. It looks like these stimulus checks were going to Tesla stock, and not your favorite sushi place or local retailer.
Regardless, these percentage declines have made it very clear that now is the time for everyone to step back and reevaluate their trading strategies. Since I’ve been in the innovation field for over 10 years, this seemed like the right time to get one of my favorite tools out of the toolbox for business model innovations: the 36 stratagems.
Kaihan Krippendorf, bestselling author of New York Times In the area of strategy and innovation, he developed a framework for the development of new business models and strategies using tricks from the ancient Chinese war.
As I reviewed them, I realized that they couldn’t be more relevant today, so I picked five that are particularly good for businesses in today’s age. Hopefully, they’ll drive innovation or help you reinvent your business, maybe in ways you haven’t considered before.
1. Relax while the enemy goes out (以 逸 待 劳)
Cut your overhead or switch to a variable cost model to wait for the storm. Close the doors for a while, take a vacation, rest, save money, and plan your new strategy when you return. If you reinvent the cost structures in your company, you may be able to conserve your cash reserves, update your mindset, and plan while your competitors burn up cash day in and day out.
Here is a good practical example of this trick:
A restaurant closes for three months, using the time to complete renovations, review the menu, and prepare for a streamlined take-away experience. In the meantime, your biggest competitor across the street will remain open and deplete your cash reserves if you work as usual.
This strategy has risks and implications as you may have to lay off employees in the meantime, which is difficult but can help keep your business going in the long run. You also need to make sure that the rest time is being used effectively. If the boards are on the windows but nothing happens inside, you are wasting your time without much benefit.
2. Sacrifice the plum tree to win the peach tree (李代桃僵)
We call this a “Loss Leader Strategy”. In general, this means that a company is selling a product or service at a reduced price and knows that it will earn higher dividends in the future.
A recent example is Headspace, a mindfulness app that has been offering free subscriptions to people who are currently unemployed for a year now (no verification required, just follow system rules). The idea here is that this will generate a lot more subscribers for Headspace later and also benefit those who have problems. It is an investment that is worthwhile on several levels.
3. Take the opportunity to steal a goat (顺手牵羊)
Use these times as an opportunity to meet a Pole position. There is a small window that allows you to reinvent your business to solve a crisis caused problem before your competitors see it. As a small company, you are more agile and faster than the big ones. Recognize an opportunity to resolve an issue with your wealth and unfair advantage.
There are many instances where this trick has been used due to the pandemic (regardless of whether or not business owners are aware of its origin). For example, a Portland grill and distillery turned into a hand sanitizer manufacturer when restaurants closed their doors, and a London-based design and engineering firm turned to modular outdoor seating areas and socially distant dining rooms to help restaurants reopen .
Both companies saw a hole in the market to fill and adjusted their business model to fill it.
4.Lend a corpse to revive a soul (借尸还魂)
Take a concept from the past that is relevant again. My favorite example of this is the full-service petrol station. People don’t want to touch gas pumps or get out of their cars, so amenities that were previously considered obsolete are given new value.
Similarly, there has already been a resurgence of drive-ins and other live events such as concerts and comedy shows. The public can watch their entertainment of their choice in the comfort of their own vehicles, just like the old days of driveways. Instead of applause, the audience turns on the lights and honks.
People adapt to the moment we are in instead of fighting the chaos. Think retro instead of archaic.
5. Defeat the enemy by catching his boss (擒贼 擒 王)
There were about 30 million unemployed in the United States as of July 2020, and that number is increasing. The first wave of layoffs occurred in the travel, service and retail, entertainment and hospitality industries, among others. However, it is forecast that six million more layoffs could occur, and this time around employees will be affected. and possibly those in leadership positions
This gives you the opportunity to capture the talent and leadership skills of companies at colossal speeds. This is an opportunity we haven’t seen in over a decade of tight labor markets, and these leaders are looking for a place to land. New faces in leadership generate innovative ideas, and losing another business could be your advantage.
New faces in management generate innovative ideas / Image: Depositphotos.com
Don’t let insecurity paralyze you, keep going
Despite the impact on the broader SMB landscape, as you’ve read, there are some great stories about strategy shifts that have helped some creative entrepreneurs not only survive but thrive.
Additionally, there are those who ride the waves of unexpected change such as the influx of zoom and other virtual meeting options with humor and enthusiasm, including a company that offers virtual tours of their farm and performances by goats and other guests. during conference calls and online learning sessions (for a small fee, of course). It definitely embodies the concept of being creative.
If life gives you lemons, make lemonade or lemon hand sanitizer if the situation calls for it. Volatility and change drive innovation; It has been so since great minds have worked in the name of progress and technology. In fact, Isaac Newton formulated his theory of gravity while working from home due to the plague, which means the rest of us have no excuses.