Defusing Bombs And The Mortgage Market Today

Great article from portfolio.com on bomb squads and crisis management.

http://www.portfolio.com/careers/features/2008/09/18/Bomb-Squad-Talks-Crisis-Management?TID=email/news/careers

I thought there were some good lessons in there for dealing with the rate of change in today's mortgage market.

Here are some thoughts as you prepare to reinvent you and your business in this time of historic changes.

Be ready for anything- establish 3 scenarios based on what you are seeing - worst case, baseline, best case. Will this prepare you for everything? No, but it in all likelihood a smattering of all three will happen and you will have thought through some of your actions in that case- giving you a better chance of survival.

Secure the perimeter and assess the situation- what is REALLY happening? This part is simple, but not easy. This will take intellectual honesty to examine what is happening and think through the impact on you and your business. You may lose a pillar of your business, your margins for a product line may be destroyed and never come back to the levels you expected. Deal with it and move on.

A second thought on this comes from an article I read once on Pete Carroll and USC recruiting. When he first got to USC he had a map of So Cal drew a red line around it and told his staff that USC must dominate the local recruiting landscape. The lesson here - find the area you can dominate. Pick one thing and dominate that, being scattered in this environment can likely lead to the demise of your company - cash flow is drying up and margins are shrinking.

Learning from your mistakes- 286 companies on the implode-o-meter.

I've worked at #6 and #238 on the list. There's a pattern that happens when companies die in this environment- are you learning about the key variables that affected your demise? Are you acting on that wisdom when you see it again?

Document what went wrong, understand the key drivers behind it and develop two ideas that you could implement next time if you saw the same pattern. Will the pattern always repeat itself in the exact same way? Probably not. Will you better prepared for the subtle changes in the pattern if you have at least two ideas developed and ready to go? Yes and that's two ideas more than your competition.

Remember- the ability to quickly adapt and change is a competitive advantage that can help you and your company evolve to the next level of survival and success.