The disruptions that came with Business 2020, and the years that followed, showed that adopting prudence as a key consideration in any strategic approach is nothing less than time-tested wisdom in action. This is particularly relevant to small and medium-sized businesses with limited resources.
Prudence – what’s that?
Prudence is that quality of being careful and sensible. It is a crucial trait for any person who understands that success depends a lot on ensuring survival first. It’s also important for entrepreneurs who want to succeed in business but don’t want to subscribe to the “move fast and break things” motto by Facebook’s Mark Zuckerberg – who did end up moving fast and breaking things. Like democracies, for example.
Unfortunately, the value that prudence provides often goes unnoticed due to its lack of glamor. It’s also associated with slowing things down in an environment where we are made to believe that speed is everything. What I believe many fail to appreciate is how prudence can be a powerful tool for astute decision-making.
One of the major benefits of being prudent is that it demands well-informed decisions as the desired outputs. This means that the decision-making process will involve due diligence and a lot of research rather than acting impulsively. This, again, brings up visions of slowing things down. But there is a reason why the proverb “slow and steady wins the race” still resonates to this day.
In the case of small and medium-sized businesses, the exercise of prudence can be critical given the grim 70% failure rate of new businesses within a 10-year period. And that is under normal circumstances. During the height of the COVID-19 pandemic, businesses had to make drastic changes to their operations to survive. Not a few businesses had to shut down their operations entirely. The thought had occurred to me that I may also end up shutting down my own business.
Luckily, after a few months of trying to make a hybrid reporting arrangement work, we decided to fully transition into a remote working setup and have not looked back ever since. We didn’t have to layoff any of our staff. We managed to cut down our costs. And, more importantly, we were forced to digitally transform our operations thereby future-proofing the business for the challenges ahead.
This may be stating the obvious but it needs to be said: the business landscape is constantly changing and evolving. I understand that many business owners feel compelled to make quick decisions, move quickly, and adapt to new trends and technologies to stay competitive. But while speed is important, it’s also important to remember that moving too fast can lead to mistakes and broken things. That’s why I believe that exercising prudence is a sound value in today’s business world.
The art of moving fast without breaking things requires a delicate balance between speed and caution. Companies need to be able to move quickly in order to stay ahead of the competition, but they also need to take the time to ensure that their decisions are well thought out and that their actions won’t lead to the straw that breaks the camel’s back.
