[ Editor’s comment: Surprisingly, we had a significant response to the mayhem piece that we sent last year so I am forwarding it again with some additional sources of “mayhem.” Feel free to forward this email to others that might be interested. – DPM]
In a popular series of television commercials for a property and casualty insurance company, there is a "Mayhem" character who causes unexpected disasters for auto owners. In one commercial, he's a satellite dish falling off a roof onto your car; in another he's your car navigation system, gone haywire, causing a crash. The message behind these commercials is that since mayhem is unavoidable, you need insurance.
It struck me recently that companies generate their own versions of mayhem - things that occur that may on first blush seem to occur unexpectedly or just be unfortunate.
Here are some examples:
· Discovering that your employees have been plagiarizing content that is in your products
· Discovering that you don't have the rights to use the trade name you've been using for 15 years
· The employees that are developing your blockbuster new product all leave at once
· A new competitive product offering undercuts your price by 60%
· Your customers discover that one of your key vendors has been substituting a hazardous or substandard material resulting in product malfunction or customer injuries
· A new business model renders your product or service irrelevant
· Discovering that new regulations no longer allow you to ship your product
· Discovering that there is no liability insurance for all the products in the field that you've made for the last 10 years...and a latent defect has just been discovered
· Discovering you can’t produce the company’s “S - election” documents for the IRS and it’s the week before you are scheduled to close on your business sale
· Surprise! You learn that you have a huge tax liability from “built-in gains,” state and local taxes in other states (or countries), etc.
All of these are true. Some might say bad luck. Synonyms for mayhem are chaos, disorder, confusion, turmoil. The dictionary defines it as "needless damage." In truth, all of these examples of mayhem were identifiable ahead of time and most could have been avoided or significantly mitigated.
In tough economic times, companies can be myopic and can ignore the need for strategic planning, competitive scanning, and can defer implementing business processes and controls.
Some thoughts as you enter 2012:
Develop a strategic growth and execution plan (Please- not another “retreat” but a meaningful plan of execution)
· realistic assessment of where you are (strengths and weaknesses, opportunities and threats)
· competitive scan looking at traditional competitors as well as possible disruptive threats
· develop some scenarios of the future (including those at the extremes) and actions to be taken as these versions of the future play out
· develop specific actions, metrics and accountability to shore up the weaknesses, fill the gaps, address the risks, and take advantage of the opportunities and strengths
· If you are preparing to sell your business, start now. You want to uncover sources of “mayhem” with time to fix them. Having mayhem discovered during a sales process can cost you.
Don't let another year go by. Neglecting the next steps in your company's growth and maturity can be very short-sighted. You need to protect your company from mayhem!
What are your examples of company mayhem?