Next Level Thinking

Like many small businesses across the globe, I too have found my business significantly impacted by COVID 19.

We were just at the expansion phase in our business cycle, where we were about to really fly in 2020, when BAM! suddenly I am receiving pictures of soldiers in uniforms being dropped off in buses around SA, and the next thing we hear we are entering level 5 lockdown for 3 weeks.

Initially I was not aware of what was to come. It was only for 3 weeks right? How bad could that be? But then …it got extended.

Most of the corporate clients we had, either cancelled or postponed till 2021. Many clients did not want to shift to online. Suddenly the reality of the situation kicked in and we have been trying to deal with this ever since. As a business, where I sit today is most likely in the recession phase of the business cycle, and perhaps even the trough. The recession phase is categorised by a stark decrease in all economic factors like prices, production, services, savings and investments. This then leads to the trough phase, which you can notice, when there is a rapid decline in national income and expenditure, the economic activities of a country decline below the normal level, and the growth rate of an economy becomes negative. So… here we are. Now what?

The business cycle can be seen as the natural rise and fall of economic growth along its natural growth rate over a long period of time. In severe cases you might have heard it being referred to as the “boom-and-bust” cycle.

There are four phases in the business cycle:

  1. the expansion
  2. the peak
  3. the contraction
  4. the trough


What makes it relevant to all of us now is that the strategies that work in one phase, will not work in another. With this in mind, you need to ask the question – where is your business in relation to the business cycle? If your business has shifted phases, as mine has due to COVID 19, what is your new strategy you can employ now to turn things around?

There is another layer to be aware of here. Within each one of these phases, you can also find yourself in a plateau. This part excites me as the way to address it aligns perfectly to what we do.
As stated above, your business transitions from one phase to the next, but if you continue with the same strategy, it will not produce the same results. The growth of your business will start to taper off and eventually level out. Now you are in a plateau. But this might not be the only reason you find yourself in a plateau. It might be a result of what is known as the “Peter Principle”.

“The Peter Principle states that people rise to their level of incompetency in an organization.”

In another words, if you perform your job well, you will likely get promoted to the next level of hierarchy and continue to rise until you get to a point where you no longer perform well.

(Image source

This happens because people are promoted based on how well they’ve performed in their previous roles, not on how compatible their skills and experience are for their future role. This you can see across many organisations.

As an example: you have a technical expert in one department, who creates excellent results. They are then promoted into management, only now, they are no longer in a position they are comfortable with, they now need to manage people and have no training or experience at all. This creates a whole host of problems, for example lack of effective leadership, or micro-managing as a way to stay connected to the technical side of the work, loss of confidence as they are no longer connecting to their superpower.

Whether you are in a plateau as a result of COVID 19, or as a result of people having risen to their level of incompetence, you can turn this around by developing a learning organisation, developed by Peter Senge and his colleagues. Organizational learning is defined as:

“the process of improving actions through better knowledge and understanding”
(Source: HBR)

Never before has knowledge been so widespread and ubiquitous. If you are not developing yourself, you will remain where you are. A solution for the Peter Principle is to focus on driving internal growth by developing the skills your management and leadership team possess. In an article by Amit Nagpal (link below), he shares the 7 reasons why continuous learning is so important, which I will summarise here. Continuous learning helps you:

  • remain relevant
  • prepare for the unexpected
  • boost your profile
  • build your confidence
  • spark new ideas
  • change your perspective
  • pay it forward

What new skills or competencies do YOU need to build to get to your next level?

With love, Savannah

I would like to thank and acknowledge the following individuals for their blogs that have provided great insight and depth.


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