In turbulent times such as these, it’s hard to keep a clear head when everyone around you is losing theirs. We look at the psychological forces that drive us to panic and how you can combat these urges to steer your business in the right direction.
As recent events have shown, in times of crisis even the most sensible and stoic among us can still be prone to panic. In the face of fear and uncertainty, we humans are hardwired to give in to our instinct for self-preservation, often to the detriment of rational thought.
Since the coronavirus outbreak was declared a global pandemic, and in some cases even before this was the official word, we’ve seen some extreme examples of this behavioural pattern in play. Supermarkets shelves stripped bare of basics, for instance; or more recently, a wartime-like run on grow-your-own veggies. And all this despite assurances our food supply is secure.
Of course, consumers are not the only ones worrying. Whether it’s faltering supply chains, social distancing measures, concerns around employee wellbeing, or dwindling cash flow, this crisis has given business owners plenty to panic about, too.
So how do you stop things from spiraling and regain some control? Here we consider what triggers us to panic in the first place and what you can do to keep leading your business with a level head.
Why we default to panic mode
At its most basic level, panic starts when your brain gets overrun by anxiety, usually in response to a perceived threat. Instead of any sensible negotiation taking place, the emotional centre of the brain (the amygdala) goes into overdrive. This floods the more rational part of the brain (the frontal cortex), which handles our behavioural responses. Before we know it we’re making decisions without thinking them through.
When faced with the scary unknown, humans are particularly susceptible to panic and the impulsive behaviour that often goes with it. Unlike in a known crisis, like a fire or a flood, the uncertainty surrounding an unknown crisis makes it extra hard for us to assess the risk involved and prepare – hence, the tendency for more extreme, irrational responses. Panic buying may be an overreaction but it’s simply some people’s way of coping or feeling like they’re in control when they can’t be sure what’s coming next.
In the current situation, this has been made worse by conflicting messages and misinformation in the media. Whether you’re a consumer or business owner, it’s hard not to catastrophise when faced with a daily barrage of speculation and worst-case scenarios. Combined with social isolation with no fixed end date, we’re ideally primed for panic.
How to get a grip on the situation
In some circumstances, for example, you’re about to get hit by a bus, panic is potentially life-saving. However, when dealing with longer-term threats, such as a global pandemic, you need the rational side of your brain to remain in charge.
Here are seven tips for staying calm during this crisis and stimulating the parts of the brain that are good at planning and decision-making.
1. Stick to the facts
Stay informed but seek out reliable information only and try to limit your exposure to news and social media – too much will only fuel your anxiety. Consider sources such as health.gov.au and other trusted organisations such as Business Australia.
2. Keep things in perspective
Avoid fixating on the unknown and imagining the worst. Cognitive Behavioural Therapy (CBT) may help in this regard and has been shown to improve our intolerance of uncertainty and reduce fear and anxiety. The idea is to recognise and challenge irrational thoughts and replace them with rational ones, helping you make more evidence-based decisions.
3. Plan ahead
While it’s not good to dwell on what might happen, it is necessary – and even therapeutic – to plan and prepare for possible scenarios. Consider direct and second-order impacts on your business and identify the actions you might take in response.
Taking the time now to plan for the short, mid and long-term will help you stay agile as the crisis unfolds.
4. Show leadership
It may be tempting to stick your head in the sand, run for the hills, or simply freeze, but remember your team is looking to you for guidance and support. You may not have all the answers, but you must keep communicating with them. The same goes for your customers. Now more than ever, connection is key, so look to increase the number of communication points you offer and let them know they can rely on your business.
5. Adapt and survive
Look for ways you can pivot your business model around this new operating environment. If you’re in the service sector, for instance, telephone consultations can be a viable alternative to face-to-face. Bricks and mortar retailers could consider an e-commerce platform if they don’t already have one in place, or home delivery could be the answer.
6. Remove inefficiences
Given the circumstances, it may be wise to preserve cash, particularly if your business has taken a bit of a hit. Try to identify areas of inefficiency or unnecessary expenditure that may save you cash without affecting future growth. If necessary you may also need to cut your marketing budget or cancel other discretionary expenses.
7. Prepare for recovery
Focus on what you can control, including the proactive steps you can take to continue pursuing your mission. This could be, perhaps, collaborating with other businesses and brands to take your business forward. This can help you ensure you’re ready to bounce back when conditions improve.
You may not know how a crisis situation will pan out, but there are plenty of steps you can take to avoid panicking and keep a healthy state of mind. And, if there are times when you’re struggling to stay focused and irrational thoughts are getting the better of you, remember, whether it’s a counselor or a friend, there are always people available to talk to.
This article was first published on the Business Australia website (formerly NSW Business Chamber) in Apr, 2020.
