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  • Writer's pictureHamish Mackenzie

Why so defensive?

When it comes to professional sports, I believe that attack is often the the best form of defence. This was illustrated perfectly by Liverpool FC yesterday as they beat Manchester City in the English Premier League. In the NFL, the New England Patriots are great exponents of a similarly aggressive approach. I've never understood why so many sports teams play not to lose, rather than to win. Nobody wants to watch that, it rarely works against high quality opposition, and it can't be much fun to play that way either.

In my experience, many businesses are also too defensively minded. When threatened with competitive pressure and falling sales, they cut costs instead of investing in new ways to deliver more value. A 2010 Harvard Business study of 4700 public companies showed that firms who pursued this kind of negative strategy most avidly during a recession had the lowest probability (21%) of outperforming their competitors when it was over. Admittedly, the same study showed that no holds barred spending sprees were not the answer either.

Instead, it was the firms that found the optimal balance between selective operational cuts and increased investment in key areas like marketing and innovation that fared the best post-recession.

Seriously, when company executives decide that removing inexpensive staff privileges such as free soft drinks in the office (except for board meetings, obviously) is the type of initiative that is going to save the company, you can be pretty sure they're dead already. Business owners should face tough times with more positive action, and less frightened penny pinching. After all, who would you rather follow - the inspirational leader facing up to the enemy who believes you can win, or the scared one hiding in the bunker who has already given up?

Copyright, Hamish Mackenzie 2019


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