Uncertainty
- Gina Hand
- Apr 11
- 2 min read
Navigating the Unpredictable: Lessons from Disaster and Resilience
The recent images of flooding in Kentucky serve as a stark reminder of the devastating impact of natural disasters. These events are not only heartbreaking but are also a painful reminder of similar challenges we faced when our home and business flooded in 2016. The damage was extensive, leading to significant disruption and a prolonged recovery period. It was the “100 year flood” and some even labeled it the “1,000 year flood.” Thousands of homes and businesses were impacted.
The business was closed for 3 weeks while we feverishly began making repairs. We reopened with tarps covering the bare walls where sheetrock once hung. It wasn’t pretty but like the other businesses and families, we did what we had to and started rebuilding. (I know more about floating and finishing sheetrock than I ever wanted to know!)
Two years later, my husband and I purchased the family business, optimistic about the future. However, a little over a year later in March 2020, the COVID-19 pandemic brought an entirely new set of challenges. The initial two-week closure to "slow the spread" extended to three months of zero revenue, followed by ongoing difficulties due to social distancing and capacity limitations. It was a long, painful road wondering if we would survive, praying we wouldn’t lose the business that had been in the family for 50 years. Fortunately, we were able to adapt and the business is now thriving.
These experiences have highlighted the concept of "Black Swan events"—unpredictable, catastrophic occurrences that defy conventional planning. We were not adequately prepared for either the catastrophic flooding or especially the chaos and financial loss from the pandemic. Normal business operations were disrupted and the false security in the financial future of the business quickly evaporated. Traditional risk management approaches proved insufficient, and we were compelled to pivot into uncharted territory.
To effectively prepare for such unforeseen events, businesses must prioritize resilience and flexibility in both financial planning and operational systems. Our recovery, particularly from the pandemic, was significantly aided by adopting more strategic financial and investment planning, alongside the development of adaptable operational systems. This response was not a result of some wise insight or vast knowledge we had. We were just trying to survive!
The adage "plan for the worst but hope for the best" is highly relevant for businesses. It prompts us to ask: Does your risk management plan account for Black Swan events? How would a natural disaster impact your operations? What are the potential effects of impending tariffs or a changing economy on your finances? Having a robust plan and a flexible mindset are essential for navigating a business through uncertain times. Hopefully, there won’t be a “next time” for us but if there is, we will be much more prepared!
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