Short, Medium or Long Term?
One of my standard opening questions is “how’s business?” As you’d expect the responses I get vary enormously but I’ve taken to notice the context within which the answer is given and what I’m finding is that many people have become incredibly short term in their thinking.
Indeed, I believe that a significant majority base their reply on the current 12 months or less, sometimes much less. This begs the question, what is the most appropriate time scale to be assessing your business on?
I remember Stephen Covey showing a small group of us a video about potato growing that illustrated his idea of “The Law of the Harvest”. In the film, a farmer from Idaho explained how an excellent crop typically required 4-5 years of preparation. A field needed to be prepared for growing potatoes by leaving fallow for a period and also by planting non-profitable crops that had the beneficial “side-effect” of adding nutrients to the soil. Stephen suggested the same is true for many individuals and business generally – and I agree. The trouble is, too many business owners are obsessed by current results and only pay lip service to anything beyond the current reporting period. Consequently, the mood, behaviour and decisions are all based on current events, many of which are fickle and out of anyones control.
Of course actions need to be taken in light of current circumstances but my suggestion is that they should also be considered with the medium-longer term, 3-5 year overall objective too. As you make your decisions this week, ask yourself, “what will be the impact of this decision over the next 3 years?” – my bet is you’ll make a different decision in many cases.
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