Emerging from the Ashes
By Maina Gachanja
Dry forests are prone to wildfires mostly in the drought season. Evergreen forests too face the risk of fire but in this case man made ones. Especially when a foregetful cigarrette smoker drops his/her butt on the grass immediately after quenching his/her ‘thirst.’ In these two instances widespread forest cover is wasted by fire and what remains is black ash spread all over the dry land. No single plant is left, even the wild animals hibernate or migrate to other lands where there is some foliage to eat. Doom hangs above the burnt forestation. But one surprising thing about evolution is that little time passes away before the same forests are green again. Some supernatural hand might be associated to the sudden change of events.
Similarly in life and especially the world of business that we are in, widespread destruction has been occassioned to many a business start-ups. The hike in the world oil prices wiped out most of company reserves reason being most of the worlds production and business lines are fuel based or rely on fuel to help reach the end product to the end user. A lot of businesses have been ‘burnt’ down lately, both big and small. We might say the business linkages our businesses had to the global village caused most of the damage. Just like in the wildfires, a period of doom will hang over the business environment for some time before new and small businesses start emerging. Analysis confirms that the best businesses that later became corporate leaders in the world business arena were thought about and started during a recession.
We should therefore not lose hope because the grass will be green again. I have not yet understood why the global economy behaves in a cyclic manner but one fact I do believe in is that we are the only people who can chose to have our success follow the same destructive pattern. The US economy will restart the drivers of their own economy, their populations will be empowered with more disposable incomes, suppliers will fill out more orders from the population, manufacturers will put out more innovative products to the market, people will have surplus, they will soon see the need to have a holiday, your restaurant will again be fully booked. There is no reason to worry. All we need to do is stay in money and stay with it indeed. Reason being we really need it to witness the second repeat of the boom inorder to grow our wealth. Warren Buffet quipped that this is the time to be greedy with investments. A time when investments are being offloaded at throw away prices. This is the best time to save and invest. Investments are one avenue where you could spring to financial stability once the slowdown is over.
The only demoralizing factor is that our generation had not expeienced a recession while being employed. Our folks experienced a recession, we were employed during boom time and now we are in a recession. What would prevent a boom from coming back. Just like I said the grass will be green again. We need to make concerted efforts towards rebuilding what we lost. First if it is a job, we need to find and maintain one as fast as possible. Secondly we need to quickly relearn the art and skill of managing our cashflows with an aim of creating a surplus. That mode of spending like there is no tomorrow ought to go if we are to rise from the ashes. We also need to be fanatical savers just like the Chinese do. The only way we could achieve this is by cutting back on luxurious purchases, holiday and movements.
We ought to try and fit into the shoes of an intern if we are to raise our heads again. Risk free investments will come in handy during these trying moments and if serviced religiously, they will come in handy once the recession is over. A perfect example is a unit-linked investment plan offered by registered insurance brokerage firms that invest client money in risk free vehicles like bonds and treasury bills. The reason being that the return of your money is guaranteed plus a considerate fixed rate return on top of your savings. The same plans also do offer cover against the risk of death, disability, and critical illnesses that could wipe out an individuals savings and assets once they strike. Besides savings and investments we ought to constantly feed and expand our financial knowledge. The rounds I have done lately clearly indicate that our financial literacy levels need some servicing. Beyond having knowledge we ought to offload most of the household items we had aqcuired during boom time, move to smaller houses that attract cheaper rental payments. But this is when jobs are unbecoming and you need start-up capital to venture into full time jua-kali business that is currently the best payer. All these being done to save our skins and move on. It is so saddening when your money dies and leaves you alive. The vice versa is more attractive to most of us but it happens minimally in Africa and mostly in Western worlds.
So if we are still breathing, what does that portend for us? There is still a long and challenging journey ahead so we ought to be physically fit. Steve Covey -In ‘Seven Habits of Highly Effective People” talks about renewal where he advises readers to skip 500 times, and do 50 push ups daily before taking a bath to start the day. There is a strong correlation between financial success and physical fitness. US and China train their working population martial arts skills inorder to face life and business challenges. It enhances focus and resilience in a particular task I guess. Skills on dealing with, influencing people around you,minimizing worry are quite essential in business management. They help reduce stress and burn out. essential recipes for lethargy and reduced focus. Failures in the Capitalism structure and design have condemned us to ashes but as wisdom puts it” when you get into a hole, stop digging and look for a ladder.” Questions on Insurance and Investments will be answered in this column. Have a fit week guys.