Businesses and How They Get
Ready for War

I would urge you to read a recent article in Wharton's Knowledge@Wharton journal about how businesses are getting ready for war. It contains a powerful set of stories on what executives are really thinking at this time. Much of the news is sobering--to say the least.

What is the real issue here? It is about hedging our bets against risk--that eternal warrior against certainty. As economic developers in the United States, we have been very lucky to do our jobs in a relatively low-risk environment. Look around the world. Would you want to be an economic developer in India or Bahrain right now? I know some in both places. It's a lot harder.

Let's talk for a moment about how we think about world risk problems. The first question is "how do we deal with what we don't know?"

First, focus on the "questions" you are asking. This is another instance where asking the right questions is most important. As an economic developer working in the Southern Tier of NY or Tupelo, Mississippi, what are the right questions you should be asking regarding the war situation, our national and global economic problems and related matters? Many of the questions that I hear right now relate to a root question: "How does this affect me?" Maybe we should ask the question of how it affects others as well, which would give us additional insights into how it might impact us.

Then, work at defining what we do know. Chances are good that you know some things that can help to cope with the situation at hand. My only advice here is be careful what you believe. Put your beliefs to a knowledge-test. It is very easy to fall prey to "belief-lock," which causes us to believe what we have always believed because we have always believed it.

My other advice is to look carefully at what you take to be "knowledge." All of us are susceptible to accepting only knowledge that conforms to what we believe or want to believe. Ask critical questions about what the news media reports to us. All stories evolve over time, and we have to patch together the truth in dribs and drabs. News reports are very helpful. We need them. But they are no substitute for knowing what the underlying issues are. If we don't understand the underlying issues, the news reports are just a jumble of information streams bombarding us.

People believe some amazing things when they feel afraid. Fear usually drives us back to our native instinct to self-protect. When in doubt, shut down and withdraw. That's a big mistake, especially in looking at the Middle East situation and our chances of fighting a successful war with a nation (group of nations) that sees "fear" as its single biggest weapon. Fight your fear with your knowledge.

Then, you swallow your pride and admit what you don't know. Actually, it's important to work at defining what you don't know and how you might develop some reasonable answers. Again, prepare thoughtful questions. We will never gain ground on risk by pretending that it doesn't exist. I talk to people everyday who ask me in a fatalistic tone, "but what can we do?" My response is: start thinking, and think in scenarios.

What can local economic developers do? While many are wringing their hands about not having enough investment deals right now, there are other things you can be doing now. I've said this before: Stay in communication with local companies. Ask them how they are thinking about and preparing for the war. Help them gather the information they need to make better decisions about their business operations during this time of uncertainty. They just might need your help.