What happens within us when we have to change the way we’re doing business because of a tidal shift in the business climate? It's usually intensely uncomfortable and more difficult than we might have imagined. And it typically results in high stress and low efficiency, and there are physiological reasons, mostly in our mind, for this discomfort and stress.

Bill Reminder of Extang Corporation, one of the largest manufacturers in Ann Arbor, could have been a victim of Michigan economic woes, but he led Extang in the other direction. Extang, Inc. manufactures top-selling pickup truck bed tonneau covers and pickup truck accessories, an automotive aftermarket business, so we might think they would be dealing with huge losses and waiting for the good old days to return, we might think.

 

Reminder looked at the economic woes as an opportunity to leverage his company’s strengths.

“Extang was well capitalized when the downturn hit so we took the downturn as an opportunity to go shopping for complementary manufacturers that would round out Extang’s lines and provide more efficiency and capacity in our manufacturing. Even though we found some great opportunities, I knew our window to make smart acquisitions was limited, so our biggest challenges were completing our transaction quickly with our targets before key aspects of their business degraded during the economic downturn."

The net outcomes have been that Extang has grown more than 20 percent each of the last three years. Merged with its biggest competitor, acquired another company of great products out of Nashville, Tenn., and is pursuing additional acquisitions. These companies now operate as the THI companies.

Our inner voice will challenge us
When we see or hear something new, our brain goes through a conscious process of evaluating whether that new circumstance is endurable, and we form an expectation of what might happen next. It's the "inner voice" we all hear that discerns predicaments, and then provides mental commentary on whether the new situation is endurable.

Our subconscious brain simultaneously performs a self-test to see how well this new situation matches the pre-existing patterns in our brain. If there is a conflict, we get an uncomfortable gut feeling or hear our inner voice say something like, "There’s no way we can survive this!" usually before we've completed the conscious evaluation.

If this dire warning is strong enough, we might react to any optimism we hear from others as “a rosy picture,” “pie in the sky” or "Maybe that will work in another industry," and then we set out to construct a world for ourselves that meets these expectations.

But if the inner warning is tempered because we’ve risen to every past challenge we might tell ourselves, "I just need to work a little harder (or smarter) and this economy could work out just fine for me." The latter mental context allows for the possibility of continued success. We think and behave consistently with our expectations, and success in a bad economy is much more likely to happen.

So what's really going on in our head?
To ensure survival, the brain primarily operates using subconscious information. Rather than evaluate every interaction with the world as if it is a new event, the brain has a process to react efficiently and reliably to most events.

This process is built on neural pathways called basal ganglia. These networks of signal transmitters are nourished and grow with use. As signals pass through them they become more robust and their ability to perform the next time they are needed improves, much like repeatedly swinging a golf club establishes a muscle memory, allowing for a higher performance.

This physical attribute is also a natural form of self-preservation. The transmitter doesn't care if it's transmitting a good thought or a bad thought; it just performs better with every use. Ever wonder why we occasionally do or say something inappropriate even though we know instantly that it was wrong? Welcome to the power of basal ganglia.

We will not change our behavior until we are able to charge up some new neural pathways and begin allowing the old ones to fade. When high-performance businesspeople describe how they have dealt with adapting or changing some of their habits, a defining moment occurs when they learn a new idea. They feel very uncomfortable, but are able to finish the conscious evaluation. They have the ability to follow through with a new behavior rather than succumb to the discomfort.

Survivors take risks
Taking big risks in an economic downturn is not usually the first impulse for companies like Extang, but Reminder is encouraged that he was able to find his greatest opportunities amid a collapsing economy.

“As painful as what Michigan has gone through with the auto industry, I believe we are going to come out of it so much stronger. And when we do, we will be unstoppable,” he says. 

Businesspeople who have thrived through tough times often tell us about a certain moment when they realized they needed to do something different, Reminder added, “You have to have your whole heart in your business to succeed in these circumstances. You’ll never be able to see the opportunities that open-up if you are on cruise control."

Leaders like Reminder were able to do something that seemed risky, or even dangerous, because they realized that to do what they have always done was not going to succeed. While bold moves don’t always produce happy outcomes immediately, they can lead to innovations that make a company stronger, ensuring a lasting success beyond a downturn.

And in the process, the bold leaders are actually growing new basal ganglia, charging up new neural pathways and developing a a “muscle memory” for future success.

 

Joe Marr is a public speaker, sales and management consultant and trainer, and runs the Sandler Training Center at 501 Avis Drive in Ann Arbor. To reach him call: 734-821-4830 or visit his website at www.sandlerannarbor.com.