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Survivor's Guide to 2003
Ten things smart companies are doing
to get ready for the upturn

By Jerry W. Saveriano, President and CEO

"We few, we happy few, brave, fit and lucky—now get to enjoy the just desserts of our survival."

My paraphrase of Shakespeare paints business survival as some sort of glorious battlefield victory, but Woody Allen once said that 80 percent of success is just showing up. And, really, our survival is a bit of both. After getting through 2003, I’ve begun to appreciate the insight in Allen’s seemingly flip remark. After all, winning the battle and surviving the bad times in business is partly accomplished by simply showing up ready to compete—day in, day out, year after year.

I’ve been working on the idea for this article for the past few months. The idea for a “survivors” piece occurred to me when I attended an Oregon Entrepreneur Forum (OEF) committee meeting and an SAO (Software Association of Oregon) seminar about weathering the downturn. Many Oregon-based tech companies have been pretty well trashed over the last year and a half. Hardly a week goes by without reading about a once-proud, fast-growing company that has gone out of business, reorganized or been purchased for a pittance. Too often I attend networking and business events that were once energized by talented, enthusiastic entrepreneurs bragging about their next big thing, only to find that now I’m greeted by the sad, dull eyes of the walking dead or the almost guilty “survivor syndrome” look from those who have made it through the tough times.

Well, I for one am tired of it. Maybe because I’ve been in tech so long and have seen at least four major downturns, each following an era of booming tech growth. There was defense in the early 70s, integrated circuits in the mid-70s, personal computers in the mid-80s and the Internet in the late 90s. (1) I also went through a mini-bust in the mid-80s in the robotics industry. The only real surprise is that we were surprised that it happened—again! But after each of the blowouts, like Yosemite after a devastating fire, we recover and begin to find new, healthier growth. C’mon, admit it—you knew it couldn’t last long, that irrationally exuberant roller coaster ride. With the exhilarating ups must come the breathtaking downs. But we won’t be down for long; in fact, I say we’ve bottomed out and have begun to rebound.

Like an Oregon spring
It looks like we’ve turned the corner on the recession. Retail sales and consumer confidence continue to be strong. Manufacturers are ramping up to refill supply chains. Even advertising is starting to rebound. That’s good news to us at Sanda, home of the Ad Man. Even technology, semiconductors and the stock market are starting to show signs of new life. Of course, the signs are still a bit mixed. Unemployment continues to be a problem, and the U.S. economy still feels uncertain and fragile and to some degree is still held hostage by international politics and threats of terrorism. Nonetheless, the upturn is coming—slowly, hesitantly, teasing us with the promise of better times—and like an Oregon spring it will gradually warm its way into summer, but not all at once. (2)

So let’s say you’ve made it through the toughest economic downturn since the 70s. You’re battered but not beaten—you’ve made it. Many of your competitors are gone or amongst the walking dead. It looks like the worst is behind you, and the phone is starting to ring again. Now is the time to start positioning your company to increase market share and grow revenues.

I’m writing specifically about what’s happening right here in the Northwest, particularly to business-to-business, high-tech companies. And let’s face it: High-tech is important to the economic well-being of Oregon; high-tech plays an increasingly important role in all companies.

To research this article I’ve talked with some of the best local minds in the business and combed the relevant literature to present what I believe to be some of the smartest moves you can make before the other guys make their plays. What follows is the list so far. But I believe we can do better, so I want to ask for your help. Once you’ve read what I’ve come up with, I challenge you to come up with a better idea to replace what’s here. If I use your suggestion, I’ll give you credit in the published version of the article and I’ll send you a Sanda Survivor T-shirt or poster. See the end of the article to learn how to submit your entry.

The list so far:
Ten things smart companies should do to get ready for the upturn

  • Hire the best sales people around. Start interviewing them and other “A” players early so you can shorten the hiring process when you need them. You may find some who’ll be willing to work for a while as independent contractors until there is sufficient business to bring them on full time.

  • Contact all existing and past customers. Let them know you’re alive and kicking. Ask how they’re doing. See what plans they have for growing their businesses. Ask how you can help them. Ask if they know a business or two that may need your product or service. Can they give you a referral?

  • Go after your competitors’ customers. Maybe your competitors have gone out of business or have cut back on services to their customers. There may be an opening for you to win away some new business from your opponents.

  • Talk to your competitors and friendly companies about M&A, collaboration or other kinds of joint ventures. Smart executives are looking for new ways of doing business and are seeking relationships that will help them go after new markets or go after old markets in new ways.

  • Invest in some preliminary marketing, advertising and PR programs. Sanda has been contracted to do a number of market research projects in recent weeks to help clients target new market segments and customers. It’s an excellent way to find out what companies are thinking about buying—and when.

    How are you spending your advertising dollars? Is it working? There is the axiom that companies that invest in advertising during downturns are in much better position when things turn around. I can’t find any reports or studies that document this. It may be true—it makes sense, but maybe it’s just an Urban Business Myth. If you know of any credible studies that address this question one way or another, let me know. (I’ll send you a shirt!) Make sure you measure the effectiveness of your ad dollars so you know what works for you. (Be sure to read Scott McCannell’s "Scientific advertising" article in this newsletter, too.)

    Certainly, keeping your name in front of customers is a good idea, and you should consider some level of advertising or direct marketing now that we're getting ready to rebound. PR is another good way to keep your name in front of both customers and future employees. PR can be a very cost-effective way of creating a buzz and getting the phone to ring if you have new products, company wins or other newsworthy items you can pitch to the media. Build and maintain a presence in your market and your local area.

  • Negotiate low ad rates. Publications are very hungry and willing to cut deals. Many other vendors and suppliers will listen to creative terms and conditions. Suggest they kick in with some co-op ad dollars to support your new marketing campaigns.

  • Freshen up your Web site. Send out email newsletters driving customers to your new site. Make sure your collateral marketing materials are sharp and current.

  • Attend SAO and OEF meetings and other networking events—schmooze and learn. These events are a great way to keep your ear to the ground to find out what’s going on. When you talk to your customers, find out which meetings they go to—and be there. Encourage your staff to go, and give them some pointers on how to network.

  • Now’s a good time to get smarter and more agile. Your competitors will be back; even the dead ones will reappear in new forms, wiser and hungrier and looking to get a fresh start in life using your customers. Re-engineer and streamline your company to better serve customers. You’ve eliminated deadwood and waste from staff, and you should also go after policies and procedures to clean them up. Make sure your operations, like the rest of your organization, are built to better serve your customers. Teach all your employees to ask, “How does what I do add value to the customer?” They should optimize the things that do and eliminate or reduce procedures that don’t add customer value.

    Invest in your people: coach, mentor, provide effective tools, train and educate. Now’s a good time to make corporate culture changes. Employees and managers will be more amenable to positive changes in their work environment. Change legacy behavior so you can get the most out of new ways of doing things, with a new emphasis on customer satisfaction. Read “The Agenda” by Michael Hammer and other business books. (3)

  • Check out the recently created incentives for investment in new technology. Is now the time to invest in new productivity tools that can free up your valuable staff from doing grunt work and let them use their high-level skills to improve customer service? In addition to watching your cash flow in these lean times, ask yourself this: When things pick up, will you have the staff, capacity and financing in place to take advantage of market opportunities?

Oregon is a great place to do business, and even though it has been a tough 12-18 months, things are turning around. The U.S. economy looks like it will rebound faster and with more vigor than had been originally predicted. And even though Oregon has been hit harder than other states, it too will return to economic vitality. It’s not likely to return to the “irrational exuberance” of the mid-90s, which was unrealistic and unsustainable. But good times are ahead, and even though the dot-com and e-com boom was a bust technology, the Internet will have a long-term positive impact on business in Oregon, the U.S. and around the world. Productivity, our modern alchemy that makes us more from less and serves as our best weapon in our losing battle against entropy, continues to improve, thanks principally to technology. We in the tech business will once again be rewarded for our contributions to a growing global economy.

So I say the smart money is getting ready to make the best of the coming rebound. How about you? Darwin talked about the survival of the fittest. You’ve survived the worst, so now’s the time to get ready to expand and flourish.

So, OK—now it’s your turn to add your tips on how to get ready for the coming upturn and earn yourself an original “Sanda Survivor” T-shirt or poster. Click here to enter your suggestion.

Thanks to those who have already made contribution to this article. Bill Conerly; David de Fiebre, chairman of the OEF/ESC committee; my SAO Board of Directors buddies: Larry Wade, SAO president; Rich Bader, president of Easy Street; Jim Cochell, president of J.P. Davis; Bob Newhart II, president of the Oregon Innovation Center; Tasha Zahn, manager of Oregon Public Networking; Mona Westhaver, president of Inspiration Software; and Marty Schulz, LBCC business counselor. And thanks to others who have helped put this article together.

  1. There’s a superb white paper, "The Next Silicon Valley: Riding the Waves of Innovation," that examines the recent boom/bust cycle along with its consequences. It was prepared by The Next Silicon Valley Group of Joint Venture: Silicon Valley Network.
  2. A recent presentation sponsored by the Bank of the Northwest featuring Dr. William B. Conerly’s sharp and funny take on Oregon’s economy provided useful data and charts on where we are in the recovery. You can find Bill’s handout at
  3. Other current favorites include: “The Future and its Enemies” by Virginia Postrel and “The Company of the Future” by Frances Cairncross.



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