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Look Above and Beyond the Most Extreme Cases You Can Imagine to Make Much More

Apr 5, 2008
Many businesses incorrectly assume that anticipating irresistible forces is only a forecasting process. Thinking that way will only keep you confused.

An ideal best practice is using the Nth-degree test (looking at the consequences of an even more extreme change) for locating irresistible forces as a starting point for deciding what it is you should anticipate.

In a company faced with low product price, the organization might have decided to focus its attention on forecasting prices. That path is much less desirable than removing the causes of the low prices in a way that would be helpful in all price environments.

What you should anticipate when prices are weak are the circumstances that could lead to an industry consolidation. Let's assume that one reason that profits come under pressure in the industry now is because the producers pay for freight costs, and, in many cases, customers are receiving products from far away plants.

Such a circumstance, even if prices are high, should encourage two companies to merge into one that could serve these customers much less expensively. If one company in the industry is having problems making its critical computer systems work, that could also encourage a consolidation with someone whose computer systems work very well and are expandable.

Or if a company lacked appropriate successors for the CEO position, the board will easily support a merger with a company that has an outstanding CEO whom everyone likes.

As you can see, when you locate the right irresistible force (the cause of what you fear), the factors that should lead you to anticipate the needed actions are already likely to be in place.

You and your business are likely to have missed them in the past, however, because you were focusing on the consequences of the irresistible force (low prices in our example) rather than unfulfilled industry consolidation as the irresistible force.

How can you avoid missing such causes and taking advantage of them in the future? Imagine that incredibly positive and negative circumstances will occur, well beyond what's likely to happen.

For example, right now interest rates are low but inflation is zooming wherever commodities are involved. You should also look at when interest rates are high but commodity prices are falling.

Then, look at what opportunities such extreme conditions can create. After you have looked at the consequences, consider strategies such extreme conditions would open up that you could exploit.

Next, consider what strategies would work best under all of these circumstances. In that way, you won't be dependent on external conditions in order to prosper.
About the Author
Donald Mitchell is an author of seven books including Adventures of an Optimist, The 2,000 Percent Squared Solution, The 2,000 Percent Solution, The 2,000 Percent Solution Workbook, The Irresistible Growth Enterprise, and The Ultimate Competitive Advantage. Read about creating breakthroughs through 2,000 percent solutions and receive tips by e-mail by registering for free at

http://www.2000percentsolution.com .
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