In their newly released book, The Three Laws of Performance: Rewriting the Future of Your Organization and Your Life, published by Jossey-Bass, the authors Steve Zaffron and Dave Logan assert that people react perfectly to their interpretation of events. People’s actions are congruent with how the world occurs to them. Helping them to interpret what occurs for them in a new and empowering way is the key to changing, and more importantly, improving performance.

Sometimes the obvious and most direct solution is the hardest one to accept. If that were not true, there would be virtually no response to the get-rich-quick schemes and scams that abound all around us, especially in times like now of economic stress and of great change.

Most everyone knows that Warren Buffet is an American investor, businessman and philanthropist. He is one of the world’s most successful investors, and the largest shareholder and CEO of Berkshire Hathaway. One of his guidelines for investors is to “buy fear and sell greed.” What he means is to buy when the vast majority is fearful of the future and thus selling their investments. This is the best time to buy at bargain prices. He also suggests selling investments when confidence is high and everyone’s demand of buying is driving the prices to higher points.

I cannot imagine many who would not want the financial success that Mr. Buffet has worked so hard to enjoy. In times of less economic extremes, being able to judge the “fear,” and the “greed,” mentioned by Mr. Buffet is more of an art because it is not as obvious as now. But now, the fear is so prevalent that in spite of what is in front of us, most are running with the herd. Even those in a position to take advantage of bargains in the stock market are selling.

Seeing the stock market as an opportunity right now indeed takes a new and empowering interpretation of current events. Just as it does for businesses in our crafting industry to see that we are in the midst of a market-share sale. A great portion of the companies in our industry are pulling back their investments into their own success and market share, choosing instead to reserve cash. We all know that during times of economic crisis that our industry seems to do OK because people have more of a tendency to cocoon and do entertaining and less-expensive things at home. Crafting easily fills that need.

Yet the fear in other markets is causing companies in ours to step back and react as if things are really bad. From the reports we have seen, things are not all that bad. My company in many areas is doing very well this year. And, in fact, many of those we deal with are doing much better than most would suspect.

So why is everyone acting as if it is worse than it is? Maybe we don’t want to be irresponsible and get caught by surprise by some impending economic doom. As Zaffron and Logan would say, we are acting congruent with how things are occurring to us. We are reacting perfectly to the interpretation of events that says the economy has slowed. But what if our interpretation of the economy in general is incorrect in our specific and targeted market? Opportunities may not be seen as such. We may not only view the glass as half empty, we may also believe that nobody wants the water.

People tend to make more decisions based upon emotions than they make based upon logic. During times of stress many of us become like an exposed nerve irritated at the very presence of anything that threatens our view of the future. But even Warren Buffet’s logic of buying fear and selling greed is not enough for us to take advantage what might lie before us.

In the meantime, companies that have built market share are cutting back on their marketing efforts and are not adequately defending what they spent so much to attain. Market share in many categories is available for the investment of pennies compared to the dollars you might have to invest in a stronger economic time to actually compete.

There are stories of many companies that exist today who stole market share in previous economic slowdowns. Their critics call them lucky. But those who fought the battle will tell you that they bought their market share when it was on sale. It was on sale when their competitors thought cash was more important than prosperity.

Zaffron and Logan would say to look at yourself and your company a year or so down the road in a dominant position in your market, enjoying the benefits of everyone knowing you and being the first option that comes to mind. If in fact that is where you will be then, what steps must you take now to get there? Wouldn’t you rather buy that market share now for 50 cents on the dollar rather than when things are strong and you may have to spend a dollar and 25 cents against the dollar for that type of growth?

Our economy will improve. Of that we are certain. How long it will take, we do not know. But if history has taught us much, it should have taught us that the difference between winning and losing may be only one or two decisions. Those decisions may rest solely on our interpretation of the glass being half empty or the glass being half full. Can we afford not to invest in our future when many seem to be running away from it?

There are times when sales come easily, and times when they do not. Whatever the reasons, the results need to be the same. You will always have bills to pay. Obligations for the most part do not vary when there is a downturn in the economy or in your particular business segment. As I tell my salespeople, you cannot let the variables determine your results; therefore, it must be your effort that becomes the variable. You must work a little bit harder to win dollars that not long ago seemed to flow in without much effort.

Tom Peters, of In Search of Excellence fame, writes in his 1987 book Thriving on Chaos in the chapter titled Launch a Customer Revolution, “No department, including legal and accounting, should exist to protect the firm.” In a customer revolution, every department is customer-oriented. And with specific insight he re-defines profit by looking at it from inside total customer satisfaction: “Long-term profit equals revenue from continuously happy customer relationships minus cost.” Continuously happy customer relationships are a performance goal that leads to profit; this outlook changes some of the typical business moves made when things get tight.

Also from Thriving on Chaos are these words from Domino Pizza’s Phil Bressler, addressing other franchisees: “Sales building is the way to profitability. You can only cut your costs so low before they hurt the customer. You can never raise your sales too high.” Advice for building sales profitability comes from delivering more value to more customers rather than the traditional business model of cutting costs to deliver the product less expensively, or to deliver less product in order to enhance margins.

Prepare for Growth

When you think about it, adding product value while others are cutting services and quality is not only a solid business move, it virtually ensures an increase in market share when the market regains its health. Peters suggests doubling the sales force during down periods to increase sales pressure and customer service above and beyond the competition.

Another thought to consider is this. When times are good and sales are brisk, there occurs an atmosphere of being too busy to build and develop new markets. The arrogance of easy sales leads companies to be less customer-focused because sales are not won through hard-fought battles.

Typically, companies design themselves to achieve economies with employees giving 100 percent effort. When this occurs, where is the room for growth? Where are the energy and resource reserves that could be used to take the production and revenues to the next level? Certainly it will not be done by new employees that need to be trained to participate in a productivity explosion.

Most often companies do just the opposite. They cut capacity by cutting labor. Lowell Mayone vice president of Hallmark in 1987 says, “If we have too many people, we consider it a management problem, not an employee problem.” In truth, management is responsible for developing plans and products to utilize av ailable labor. A failure to allocate labor resources and generate a profit is indeed failure of management.

When the going gets tough, the tough get going. Well maybe. I would say that when the going gets tough, you severely test your customer relationships. More often than not, consumers and businesses alike cut back expenditures during tough times, based upon perceived need more than real need. Solid customer relationships can ensure a bridge across times of economic uncertainty.

Be Different

How do you differentiate yourself from the rest? Market, advertise and serve your customer more and better than ever before. Studies of recessionary periods back through the 1960s show that companies that invest in advertising and marketing during uncertain economic periods show increased market share and vitality after the economy improves. Of those who do cut back their initiatives to communicate product value to customers, only a fraction survive long-term.

Listen to Your Customer

Who is the judge of quality? I mean, who knows if I am turning out a quality product or not? My years of experience must mean that I know something, so I should know about the quality of my own work — right? If I don’t, then what is the value of all these years? Well, the only judge of quality is in the eye of the customer. Regardless of what we think, perceive or know, the customer’s judgment with their purchasing dollar is the decision that will seal our fate. Listen to your customer. Listen like your very life depended upon it. Don’t listen to confirm that you are right; listen to find out where you are wrong, and then have the courage to change it. Unless you are spending only your own money to keep your company afloat, your opinion is the last one you want to hear.

The same goes for value-added and product differentiation. Listen to your customer to find out what is important and what makes you different. You will most likely be surprised at what you learn. Keep asking the same questions over and over of different customers. You will find that these things change over time with the ebb and flow of your customer base, as well as when their needs evolve and change. Your experience may stem from many years in the past, but you need to know what specific needs are as of now. Forget all that you know and attack the problem to learn everything anew. Expect things to be different, but allow yourself to be surprised if some turn out to be the same.

Change is Necessary

Making leaps in generating results seldom happens from “doing more of the same.” Great strides in performance usually result from doing things differently rather than doing more of a familiar process. Reinventing how you do things is hard when you have achieved moderate success with your current structure. Most people don’t like change. Even fewer want to change processes that have led to a current level of success. Our human nature tells us that is better to continue the moderate success with which we are familiar than to take a risk with a new procedure to possibly achieve a larger success we have never seen.

Generating increased sales in tough times takes courage. It requires you to question things that have worked in the past. Some of those things that need to be questioned are so ingrained that most of the time we don’t even see them. It is a good exercise to have a friend, who is not associated with your business, sit down with you. You should explain to them just how your business works. As you explain the various facets of your job, allow them ask you why — over and over and over. Eventually, you will begin to see through some of the assumptions you have made and taken as facts. Then you will be empowered to look at the type of changes that can get you beyond doing the same old thing just a little bit better.

Far too often new competitors enter our business categories and revolutionize how we do business. The reason they can do so, is because they aren’t smart enough to know it can’t be done that way. We too, must practice being ignorant of our industry. It may be the only way we can adequately reward ourselves for all the years we have spent doing our job. Being able to suspend our self-imposed limitations and still use our specific knowledge is not at all easy. But it could be the genius that leads us to take everything to the next level. The first thing to understand is that the best time to grow is when others are not.