Pay Attention to the News
It is important to pay attention to what is being talked about in the news. What is happening in the government, our local communities, in the economy, and state legislation does impact the decisions we make. However, it is also equally important to not let headlines be too big of a factor in making business decisions. Worrying about the actions of organizations and people beyond our control can sometimes lead us to make poor choices. Every company and individual must find the perfect balance between paying attention to outside sources and doing what is best for an individual situation.
Government Regulation
Governmental regulations like tax laws and rule restrictions are always changing and these variations should affect any business decision process. Spending capital at the end of the year is just one small example of how companies can reduce the tax burden. Additionally, a change in important laws or the addition of a trade tariff should affect how much raw material a manufacturer should purchase or how many products a retail organization should inventory. However, spending too much effort worrying about factors beyond a company’s control can lead to poor decisions. If a business leader spends too much time waiting to see what the government will do next, they will never make decisions. There is a difference between being patient, cautious, careful, and waiting too long to act. Companies that fail to make decisions promptly are often smothered by those who are first to the finish line. This does work both ways. Companies who act too quickly can often overspend and overcommit to projects. This raises the question of how a businessperson should know when to act and when to wait. There are no correct answers and people who are successful often have an instinct for this. Only one factor is certain, the companies who forecast the actions of the government properly are always more successful than those who guess wrong.
The Stock Market
Organizations like the Dow Industrial Average, NASDAQ, and the S&P 500 provide the average American with a general idea of how the national economy is doing. When stock prices are up people are usually making more money and are more willing to spend their hard-earned cash. When the stock market outlook is bleak consumers tend to spend less and save their money for better days. These basic rules govern the decisions of consumers; however, the stock market is not always an indication of what is best for your company or your individual situation. The major stock markets report based on averages, and it is possible for a company to thrive and be successful in a climate where others are struggling. Business leaders need to consider what is happening in the economy, but the facts should not be the sole factor that influences decisions. A company that provides luxury items that can be considered unnecessary might struggle in tough economic times, but a company that provides core goods like food might still be successful. The amount of flexible income does vary based on the success of the stock market but that does not mean that every business is dependent on it.
Other Factors
There are countless numbers of worthy news events every day that affect a business. Weather, local community ordinances, and even traffic can change a company’s short- and long-term outlooks. This is why any company should always pay attention to what is happening in their environment. Sometimes it is best to make purchases and other times it is best to hold off and wait. However, there are always deadlines and times when a decision is needed. All any responsible business owners know when to act and when to be patient. At the end of the day companies must do what is in their best interest and outside factors sometimes change decisions but also sometimes do not matter. No individual is beyond making mistakes and choosing poorly. All we can ask of any manager or leader is to make the best decision possible with the information they have. Sometimes people will get it wrong and learn hard lessons but if they pay attention to all factors involved, odds are things will turn out all right.
It is important to pay attention to the news and current events, but it is equally important not to let them be the sole factor in deciding. Be aware of what is happening around yourself and your company but remember not to overreact. One of the keys to being successful is making informed decisions. No one ever knows everything and those who do not listen to the advice of others often are the first to fail.