Crisis Management Strategies

Back on recession watch, Leading Indicator #2 – the FHA mortgage delinquency rate. This isn’t typically in lists of leading economic indicators, but it may be a proverbial canary in the coal mine in the current context. FHA borrowers have low to moderate incomes, with a median income of about $75,000 a year, and most are first-time homebuyers. Judging from the recent increase in the delinquency rate on FHA loans, these households are under mounting financial stress. This is despite the exceptionally low 4% unemployment rate and goes in part to the credit characteristics of the borrowers, including lower credit scores and downpayments. Even more important may be their high debt-to-income ratios. With mortgage rates and house prices as high as they are, borrowers have to shell out a big share of their income to their mortgage payment to get into a home. They may have gambled that rates would fall and could refinance, bringing down their payment. However, the Fed’s higher-for-longer rate policy and quantitative tightening have forestalled that exit strategy. Combine this with higher homeowner insurance premiums and property taxes, and borrowers struggle to make mortgage payments. What happens when the job market wobbles even a little bit? Thus, why this is a good statistic to include in our recession watch. Not that the financial troubles of FHA borrowers are enough to push the economy into recession. Indeed, high and middle-income mortgage borrowers are having no trouble making their payments at this time – the gap between the FHA delinquency rate and those on Fannie and Freddie loans has never been as large. But if the economy is headed for trouble, it is FHA borrowers who will signal it first. And they are. #rates #FHA #income #recessionwatch #fed

In 2011, the Amazon Appstore failed on launch and Jeff Bezos was furious. It was my fault, and I handled one aspect of recovery so poorly that one of my engineers quit. I still regret it 14 years later. Please learn from my mistake. The main lesson is that when you are leading through a crisis, it can feel like it is all about you. It isn’t. It is about: 1) Solving the problem 2) Guiding your team through it The product issue was that there were some pretty simple bugs, and we solved those problem well enough that I was eventually promoted. Where I failed was in guiding my team through the crisis. My leadership miss was that I neglected to encourage and support the engineer who had written the bad code. He did a great job stepping up and supporting the effort to fix the problem, but shortly afterward, he resigned. During the crisis, I failed to make clear to him that we did not blame him for the launch failure despite the bugs. I imagine that left room for him to think we blamed him or that he didn’t belong. It is also possible that others did blame him directly and that I was too caught up in the crisis to realize it. Both instances were my responsibility as the leader of the team. His resignation taught me a valuable lesson about leading through a crisis: No matter how bad the situation is, your team must be your first priority. If you make them feel safe, they will move heaven and earth to fix the problem. If you don’t, they may still fix the problem, but the team itself will never be the same. As a leader, here is how you can give them what they need: 1) Take the blame and do not allow others to be blamed. In some bug cases after this we did not release the name of the engineer outside the team in order to protect them from judgment or blame. 2) Separate fixing the problem from figuring out why it happened. Once the problem is fixed, you can focus on root-causing. This lowers the risk of searching for answers getting confused with searching for someone to blame. 3) Realize that anyone involved in the problem already feels bad. High performers know when they have fallen short and let their team down. As a leader you have to show them the path to growth and success after the crisis. They do not need to be beaten up on- they have taken care of that themselves. 4) See crises and problems as growth opportunities, not personal flaws. Your team comes with you in a crisis whether you like it or not, so you might as well come out stronger on the other side. As a leader, the responsibility for a crisis is yours in two ways: The problem itself and the effect it has on the future of the team. Don’t get too caught up in the first to think about the second. Readers- Has your team survived a crisis? How did you handle it?

10 Strategic Cash Flow Mistakes and How to Fix Them. ------- 💎If you liked this post, you’ll love the strategic finance insights I publish weekly in my free newsletter. 💎Sign up here: https://bit.ly/4300Di8 ------- If you're making these, your organization and career might be at risk. 1️⃣ Mismatching Cash Flow Maturities ↳ Utilizing short-term financing for long-term assets will lead to liquidity challenges. ↳ Match up the cash flows on the assets being financed with cash flows on the debt 2️⃣ Ignoring Foreign Exchange Rate Volatility ↳ Trading in multiple foreign currencies can quickly erode profitability, liquidity, and leverage. ↳ Design an active FX management strategy (forwards, options, etc) to safeguard against the adverse effects of currency fluctuations. 3️⃣ Ignoring Interest Rate Volatility ↳ Ignoring interest rate volatility can impact financing costs and cash flow predictability ↳ Develop an appropriate financing strategy to manage exposures (swaps, options, etc) and protect cash flows. 4️⃣ Misinterpreting Negative Operating Cash Flows ↳ Negative operating cash flows aren't a negative sign unless they're due to underlying financial distress ↳ Secure suitable working capital financing and avoid overtrading 5️⃣ Relying on One-Time Positive Investing Cash Flows ↳ Selling non-redundant assets to fund ongoing operating deficits can hide structural challenges ↳ Resolve underlying profitability issues early and seek sustainable financing solutions 6️⃣ No Growth Working Capital ↳ Failing to adequately finance growth working capital can slow expansions and deplete cash reserves ↳ Negotiate suitable working capital financing to fund current asset growth 7️⃣ Mismanaging Payment Terms ↳ Misaligning terms between suppliers and customers can lead to cash flow shortfalls and liquidity issues ↳ Negotiate terms that complement your cash flow cycle and secure backup financing 8️⃣ Failing to Leverage Cash Management Tools ↳ Manual cash management exposes organizations to errors and suboptimal cash positions ↳ Integrate modern cash flow management tools including automated receivables and payables for improved cash flow visibility and control 9️⃣ Neglecting Cash Flow Forecasting ↳ Lack of comprehensive cash flow forecasting will prevent opportunities and introduce undue risk, threatening business viability ↳ Use both short term rolling & long term cash flow forecasts 🔟 Ignoring Long-Term Strategic Implications of Cash Flow Decisions ↳ Short-term cash management decisions significantly diminish growth ↳ Balance immediate liquidity with long-term vision to align day-to-day needs with long term goals ---- ▶Get my on-demand video course with 5* reviews: The Cash Flow Masterclass: https://bit.ly/3NZJvSO ➕ Follow me for strategic finance, business, and cash flow insights 📌Grab my viral finance cheat sheet pack: https://bit.ly/3T3CtPm ♻ 𝐋𝐢𝐤𝐞, 𝐂𝐨𝐦𝐦𝐞𝐧𝐭, 𝐑𝐞𝐩𝐨𝐬𝐭 to share with your network ♻

Leading in uncertain times is a hot topic today in business as we face a compounding set of unknowns: tariffs, inflation, volatility in our financial markets, the ongoing climate crisis, supply chain disruptions, global conflicts, and the advent of AI to name just a few. Whether you are an operator, investor or board member, I wanted to share a few of my approaches to dealing with the reality we are facing, and I would love your thoughts in response: 1. First, for me, is to remain consistent and committed to our company values. At PSP Partners, we express ours as IDEALS--Integrity, Diversity, Excellence, Alignment, Leadership and Service. Your teams want to know that during uncertainty you will make hard decisions that are grounded in your core values. 2. Radical honesty is critical. Bringing your leadership team to a point of embracing the reality of the landscape that your organization is facing is an essential foundation to then figuring out the vulnerabilities. 3. Ensuring that your balance sheet is strong to weather the difficult periods as well as to have the opportunity to play offense is more essential than ever. 4. Regular scenario planning and pressure testing various outcomes is essential to manage and mitigate risk; it is all the more important right now. This is also known as “red teaming” and it’s a critical thing to do. 5. Being curious about your blind spots and institutional biases will help create an environment where you and your team can safely challenge assumptions. 6. Overcommunicating with your management team and to your company as a whole have never been more needed. Remember it takes about 7 times for a message to break through. Don’t be afraid to repeat it over and over. 7. Embracing the idea that challenges also create unique and unexpected opportunities is so important. During uncertainty the best companies create extraordinary opportunity and returns for the long term. 8. A strong, innovative and resilient culture is always foundational and especially essential to navigating the current challenges. The CEO and your leadership team have to set the example.  

🇱🇧 Can Lebanon Turn the Page on Its Economic Crisis? Lebanon is at a critical crossroads. With new leadership taking charge, the question remains: How can the government tackle inflation and drive economic recovery? 📉 The Economic Reality: -Inflation reached 231.3% in 2023, making essentials unaffordable for many. (Source: World Bank) -The Lebanese pound has lost over 98% of its value since 2019. (Source: Reuters) -GDP has shrunk by 38% since 2019, one of the sharpest contractions in modern history. (Source: World Bank) So, what steps can be taken to rebuild confidence and stability? 📌 Key Areas for Recovery: 1️⃣ Restoring Monetary Stability -Establish a transparent exchange rate policy to curb speculation. -Strengthen central bank oversight to rebuild trust. 2️⃣ Revitalizing Key Sectors -Support SMEs with access to low-interest loans and investment incentives. -Boost exports by leveraging Lebanon’s skilled workforce in industries like IT, tourism, and agriculture. 3️⃣ Strengthening Fiscal Discipline -Reduce budget deficits through efficient public spending and tax reforms. -Ensure international aid is linked to structural reforms, preventing further financial mismanagement. 4️⃣ Restoring Public Trust -Enforce anti-corruption measures to ensure accountability. -Enhance social programs to support the most vulnerable communities. 💡 Economic recovery won’t happen overnight, but credible policies and transparent governance can gradually restore stability. The real question is will reforms be prioritized over short-term political interests? 🔍 What do you think? Can Lebanon overcome its economic crisis? Let’s discuss in the comments. 👇 #WGS25 #LinkedInNewsMiddleEast #Lebanon #Inflation #EconomicCrisis

How do you prevent mayhem when crises occur that affect you and your team? Bridges collapse. Criminals mow down innocent victims. CEOs have heart attacks. Contagious diseases spread. Layoffs happen. Such crises create havoc as misinformation and fear run rampant through an organization or team. So what’s your part in calming the hysteria among your team? Communication. Communication that’s current, consistent, and complete. When I’ve consulted on handling crisis communication previously, I often get this question from bosses: “But how can I tell people what’s going on when we haven’t yet investigated and don’t have the facts?” That’s never an excuse for delayed communication. Be mindful that when people don’t have the facts, they tend to make them up. In a communication void, people pass on what they think, fear, or imagine. Noise. Keep these communication tips in mind to be part of the solution, not the noise: ▶ Tell what you know as soon as you know it. ▶ State what information you don’t have and tell people what you’re investigating. ▶ Stifle the urge to comment on/add to rumors, fears, guesses. ▶ Communicate concern specifically to those directly affected. ▶ Offer tangible support when you can (time, money, acts of kindness). ▶ Communicate kudos to those working behind the scenes. Accurate, speedy communication creates relationships and cultures that build trust and encourage loyalty. Have you been affected by a crisis? Was it handled well or poorly? Outlandish rumors that circulated? #CrisisCommunication #LeadershipCommunication #BusinessCommunication #ProfessionalCommunication #DiannaBooher #BooherResearch

💳 When Cards Failed, Trust Paid Off Saturday evening, Denmark and Sweden were hit by a major payment system crash. Cards stopped working. Nationwide. Suddenly, all the digital tools we rely on… went dark. Denmark and the Nordics are traditionally known for a very high level of society trust, but some organizations more than others. But what happened next? That’s where the real leadership story begins. 🚗 Two Bridges, Two Mindsets The two major crossings—Øresund Bridge and Storebælt Bridge—responded in very different ways: 🔹 Øresund Bridge (Swedish side) opened the gates. They let drivers pass without paying, recorded license plates, and sent invoices later. 🔹 Storebælt Bridge, in contrast, held cars back or made people wait for systems to come online (3 hours)—prioritizing the process over flow—resulting in a huge loss of image account. One led with trust. The other led with control. And here’s the result? Drivers paid their invoices. No chaos. No mass non-compliance. Just people keeping promises—because trust had been extended first. Festivals, Restaurants & Shops Did the Same At the Grøn Festival (A big music festival), food and drink vendors served customers—even when payments couldn’t be processed. They trusted people to pay later. Many did. (A few didn't, but compare the lost revenue by not selling anything, compared to writing off a few none-payers) In cafés and small shops, staff took names, snapped photos of IDs, and let guests walk out without paying on the spot. Why? Because relationships mattered more than rigid rules. A favorite comment from Reddit: “If the payment system is down, they take my contact info, and I pay later. No drama. That’s how we do it.” What’s the Real Lesson? This wasn’t about technology. It was about human systems. ✅ People honored their obligations—when trusted to do so. ✅ Organizations that focused on continuity, not control, won both respect and results. ✅ And in crisis, those with SMARTnership thinking stayed fluid and future-focused. 🧭 Ask Yourself: If your system fails, do you have a trust infrastructure to fall back on? Do your teams have the autonomy to act in alignment with your values? Are you building relationships that can withstand moments of uncertainty? In a world that automates everything, it’s easy to forget: When the system breaks, it’s the relationship that holds. Let’s design businesses, trust —and negotiations that reflect that. #SMARTnership #Trust #Leadership #CrisisManagement #CustomerExperience #OresundBridge #StorebæltBridge #GrønFestival #BusinessContinuity #Negotiation #Resilience #RelationshipCapital

Crisis training isn’t optional. It’s CPR for your reputation. Yesterday, I ran a half-day, issues & crisis-focused media interview workshop for my long-time client, Goodwill of South Central Wisconsin. I will die on the hill that every organization with public-facing operations needs to run updated media trainings, crisis simulations, and playbook reviews 3–4 times per year. Why? Because it’s no different than office/school fire drills or renewing your CPR cert. You don’t do them because you expect the worst tomorrow; you do them because lives, livelihoods, and millions of dollars are at stake if you don’t keep your response muscles fresh. Pay a little now. Or pay much more later. Here are the core elements of my crisis trainings, updated with feedback from 30+ fellow trainers, journalists, and comms pros: 1. Safe Space & Energy – Ice breakers and laughter lower the stakes so trainees can fail fast and learn. 2. News Value & Archetypes – Journalists hunt for conflict, hypocrisy, humor, contradiction (“man bites dog”), rags-to-riches, romance gone bad, David vs. Goliath. And they’ll cast you as hero, villain, or something in between. Know both before you walk in. 3. Prep Your Headlines – Pick 2–3 key points you must convey. Even if your interview is 30 minutes, it may be condensed into one 10-second soundbite or a single sentence. If you said it, it’s fair game — context or not. 4. Modes Matter – Decide: are you educating with nuance, or delivering tight soundbites? The worst interviews are when you mismatch. 5. Foundations – Bridging, blocking, flagging, hooking. And always have a call to action ready. 6. Don’t Repeat Negatives – If asked “why is your company failing at X,” never restate “we’re not failing.” That soundbite will haunt you. Reframe and redirect. 7. The Big Crisis Questions – What happened? Who’s to blame? What are you doing to make it right? Train for these — they’ll come every time. 8. Nonverbals – Solid colors. Hands visible. Lean in. Silence beats nervous rambling. 9. Mock Interviews ON CAMERA – Not an iPhone selfie. Real lights, mic, hostile rapid-fire Qs. Run two full reps per person. 10. Respectful Feedback – Watching yourself is awkward. In a trust-based room, it’s priceless. 11. On the Record ≠ Optional – Yes, there’s on background, off record, and Chatham House rules. But unless there’s rare mutual consent, assume everything is on the record. Mic is always on. 12. Refreshers – Media training is never “one and done.” Quarterly reps keep you sharp. 👉 That’s my list. What’s yours? What’s the one drill, exercise, or tactic you swear by to make crisis simulations stick? And if your team hasn’t dusted off its crisis plan in a hot second — or you’ve never pressure-tested your spokespeople under fire — it might be worth a quick convo with someone who’s been in the room (I’m always happy to chat). Because crisis comms isn’t theory. It’s muscle memory. And muscle memory only works if you keep training.

One thing I'm seeing with my clients......everyone is struggling with marketing. Costs are generally high. No one knows what the next big thing is. And market stability feels elusive. Which means you are stressing out thinking about how you are going to get to the revenue numbers of 2021 and 2022. You're worried about being able to cover your bills for the month. You probably are worried about being able to pay employees etc. How can businesses find ways to promote themselves effectively without overspending? Cash forecasting. It gives you a clear view of your financial runway and resilience. Here's how to do it: 1. Start with Sales: Project your sales volume for each product/SKU over the forecast period (weekly, monthly, or quarterly). Consider historical data, seasonality, promotions, and new product launches. 2. Price it Out: Establish accurate pricing for each product/ channel. Factor in any discounts, promotions, or wholesaler/retailer markups. 3. Understand Your Collections: Determine your typical time lag between sales and customer payments. Factor in payment terms (e.g., Net 30, Net 60) and potential collection delays. 4. Detail Your Expenses: Include all operational expenses: cost of goods sold, marketing, payroll, rent, shipping, etc. Categorize expenses as fixed (recurring) or variable (tied to sales volume). 5. Analyze Funding Needs: Project any funding rounds, loans, or other cash infusions. Assess timing and amounts of funds expected. This ensures you have extra cash in the bank when things get dicey in the market and customers aren't buying. How are you approaching marketing in these uncertain times?

It’s 1am and my brain is vibrating at a very high frequency. The next few months are critical for businesses. We’re witnessing global wars, mass layoffs, and a post-AI world where rules are evolving very fast. Everything is shifting ... economies, industries, even identities. Sentiments are unpredictable. And evolution... it’s happening faster than we were ever warned. In moments like this, survival in business comes down to three things: 1. How resilient you are 2. How adaptable your business is 3. And then... pure, blind luck I’ve spent 14 years building through storms. Markets crashed. Partners walked away. Plans fell apart. Teams broke. But here we are ... still building, still dreaming, still growing. Every time we went through something major, I took notes. And today, I want to share the guide I wish I had during my hardest days, in the hope it helps someone out there who needs it now: 1. Embrace change and uncertainty It’s coming, whether you like it or not. Revenues will dip. People will disappoint. Strategies will collapse. Don’t fight the pain — walk with it. Let it sharpen your senses. It always has something to teach you. 2. Cut fast, but with empathy Speed saves lives in a crisis, but souls matter. When you make hard decisions — layoffs, pivots, shutdowns — do it with clarity, not cruelty. People may forget what you said, but they will never forget how you made them feel. 3. Stay uncomfortably close to your customer Your customers are evolving in real time. If you are not listening daily, you are falling behind. Talk to them. Watch them. Let their reality shape your decisions. 4. Don’t worship your past victories What worked last year might bury you this year. Ego is expensive in uncertain markets. Stay humble. Stay hungry. Let go of what no longer serves the future. 5. Focus on energy, not just strategy Your team mirrors your emotional state. If you panic, they will crumble. If you go numb, they will disengage. Be honest, be present, but above all, be steady. Energy is the invisible strategy that holds it all together. 6. Build faith in something bigger When numbers stop making sense and logic hits a wall, you need something deeper ... a belief, a cause, a reason to keep going. Call it purpose. Call it God. Call it madness. Just don’t run on empty. I don’t know how the next few months will unfold. No one does. But I do know this — the ones who feel deeply, move boldly, and love fiercely through the storm are the ones who build companies that outlive the chaos. My company stands more stable than ever today, but I haven’t forgotten the nights I sat up, just like this. So if you are awake at 1am too ... anxious, tired, and unsure — know this: we have lived through darkness to see the light, and you will too. Good days are around the corner. Let’s survive this. Let’s grow through this. Let’s make it mean something!