WHAT IS YOUR MILLION DOLLAR BLIND SPOT SCORE?
Every business of significant size periodically suffers from ‘million dollar blind spots’, or more precisely, blockages that increase risk and dramatically restrict growth. However, this is not an insurmountable obstacle; each of us has within our power the means to identify, and then solve these organisational blind spots.
Unwelcome surprises
C-level executives and board members, at some point, have probably been surprised by bad news affecting their organisation and its bottom line. A 3am phone call, a “We need to act—fast!” memo, or a nervous or angry knock at the office door; experience shows that these crises stem from three main categories: unforeseen blind spots of varying degrees, systemic and widespread communication failures, and outright fraud and deceit.
Blind spots
We are all prone to a variety of blind spots ranging from those we might not believe could happen – which are off the radar or beyond our comprehension – to a vague, unsettling sense that something, somewhere, is wrong.
Unforeseen blind spots
Some blind spots are difficult to anticipate, but likely fall into one or more of the following categories. First, there is the ‘incomprehensible’. Many businesses were blindsided by the ‘incomprehensible’ 1980 eruption of Mount St. Helens in Washington State. Mother nature is impartial, and so are stakeholders. The unanticipated requires a crisis management strategy.
Next there is the ‘we ought to know better’ blind spot. Thwarting regulations didn’t pay off for lenders or borrowers involved in ‘liar loans’, which blindsided investors during the recent mortgage meltdown. A ‘liar loan’ occurs when a lending institution tells a prospective borrower that he or she needs income X in order to qualify for a mortgage, but then slyly assures the prospect that their reported income won’t be verified. Management should have stopped this unethical practice. Barring that, regulators ought to have reported it.
Apr-Jun 2016 Issue
FiscalDoctor