Let History be your guide in the New Normal

I’m addicted to reading history and specifically military history because I believe firmly in the saying that while history may not always repeat itself it almost always rhymes … furthermore there really hasn’t been any new thinking or dare i say re-invented common sense since ancient times, just a new twist on an older theme . This weekend I picked up a book on the history of the Roman Empire. The similarities between the rise and fall of Rome and that of the United States is in my opinion startling and at the same time terrifying, but that’s another blog topic. Rome ruled the world for over 600 years due mainly in part to the unparalled military strength of its legions combined with its ability to adopt and assimilate the best customs, inventions, philosophies and tactics of the nations they conquered. The one tactic that they developed was in the way that masses of armed men engaged on the field of battle. For almost a thousand years prior to the development of what the Romans called their “manicle formation”, armies had fought either as an unruly mob or what was called a phalanx used by the Greeks. The heavily armed Greeks would lock their shields together, and the first few ranks of soldiers would project their spears out over the first rank of shields. The phalanx therefore presented a shield wall and a mass of spear points to the enemy, making frontal assaults much more difficult…think Alexander the Great or The 300. This maneuver was devastating and allowed the Greeks to rule what was then the known world.

Fast forward now to the battle of the small businessman. The game has changed now and in order to stay in the game what you need to do is adapt…quickly and with NO hesitation, become flexible, take every edge you can and prepare for the long war of attrition ie. the Great Recession Pt 2 (which i believe will run thru 2013). So what are some of the tactics in this battle? First recognize that a radical triage needs to be performed on your business, your personal spending habits and every cash outflow be put under martial law. Next take action to eliminate the debt with an acceptable loss. Lastly and this is the hardest…re-direct your cash flow away from debt service directly to the new offensive which is a business workout for long term survivability. The banks and financial institutions were quick to adapt and have been borrowing money for free from the treasury then getting paid to buy the debt back!… and making HUGE profits…is that ethical? Whether it is or not is irrelevant. Point is be quick to take advantage of any change in the game…look at what others did and make it your strategy or face defeat. Usually the hardest step to take is the first which is make a decision to not be a victim…call me if you agree or disagree 413-584-2581 x112