On Monday, as the stock markets were continuing to crash at warp speed, somebody asked me my thoughts.

I told them invite to the crash of 2011!

And while the 16% drop in 10 days is only the third time that has happened in 4 decades (also 1987 and 2008), this volatility maybe continues for a long time.

For two reasons:

1) An An Incorrect Measurement Tool-A GDP, gdp. A Currently we measure the success of our economy based on how much we increase our consumption. A When the US was the only country (mostly) doing this, we could generally get away with it. But with the whole world now attempting to do it, it is unsustainable.

2) A A Standard & Poors' Message- devaluing the US Federal government's ability to repay its debt.A While it isn't S&P's reason, the primary one from my viewpoint is # 1 (above). A This was magnified by the clear presentation this summer season of federal government's inability to operate as a unit.A The message ended up being painfully clear-- they do not have the very best interests of the country in mind.

Imagine running your company in this manner?

For example, let's state you have a business that sells handbags.A For years you have been succeeding. Your credibility and income has actually been the envy of the industry.

Then gradually the competition begins coming in.A They begin undercutting your rates and pursuing your most faithful customers.

As sales begin to slip, you increase your marketing budget to try and keep them at bay.

But they keep coming at you.

You cut your rates and work your staff members harder.A To cut costs, you utilize less costly labor and materials.

As a result, the quality of your handbags drop.A Consumers are less delighted with your brand.

Now you need more money to pay costs and increase your marketing, so you get more loans.

Meanwhile your staff members and managers, mostly stressed to the max, begin blaming each other for the errors and incorrect turns the company has been making.

Next you discover the banks have increased the rates of interest on the debts you owe them.

One day you wake up and ask yourself how you ever got into this mess.

How to manage the financial obligation crisis in YOUR service:

1) A A Great vs. Uncollectable Bill- "Excellent" is debt directly credited to generating cash for your service, via sales and reduced expenses.A When taking a look at borrowing, constantly ask yourself, "What is the ROI on this purchase?" A (ROI= Roi). A The response must be a multiple of what you bought it, like "10X". A For instance, when I borrow $100, it is good debt if it will generate a minimum of $1,000 in return.

2) A An Excessive vs. Correct Amount of Financial obligation- danger and capability to pay it back are needed here.A Danger = O * P, where O= possible outcome and P= the probability of that outcome.A The closer that number is to "1", the better.A There are risk assessment tools online to use.

3) A A Leveraging Debt- irregardless of your financial obligation position, use it as a chance to innovate and recreate your company's instructions it is heading. For instance, utilize the fact you have your debt to it to create seriousness for needing to discover new opportunities for your business to capitalize on.An Utilize it to develop more abundance of money and happiness in your life.

4) A An Increase the Team- focus on team effort and checks and balances. Ensure everyone is clear on the UnReasonable goals and difficulties ahead for the business.A And they are all in this together.A As a team.A This will probably include compromise.A For effective compromise, it is important to leaving the ego out.

5) A A Stay focused on the higher good- for all your stakeholders.A You will need to define this with your team.An Use it as a choice making process as you work your strategy forward.

6) A A Focus On Your Home- stakeholders are probably watching your movements. Whether it's your creditors or neighborhoods, social media can alter things for you on a dime.A Stay prepared, ready to respond and adjust when essential.

7) A A Redefine Success- and what it indicates to you.A Possibly the very best way to measure success is not on how much we buy, however how happy we are.A Now that's UnReasonable! Picture what that would do to who is # 1 in the world.A For instance, the United States would most likely be towards the bottom and Costa Rica towards the top of the list of "happiest" countries.

So, I believe the S&P downgrade was a good thing.A It is a wakeup call that our management group and top priorities are a bit out of whack.

And with the best focus and objectives, we will adjust our sails and move through these economic difficulties to more powerful, more grounded country and planet.

Action Steps For the Week:

When was the last time you assessed the state of your company's financial obligation?

Do you feel pressure or comfy about your money position?

If you feel comfy, review it to see how much you need to cover your fundamental nut (i.e. regular monthly costs). An Establish a plan to have 3-6 months as a cushion.

If Century Services you feel pressure, evaluate the actions above.A Determine where your financial obligation situation is from a danger vs. reward of spending your cash on specific investments in the company.A Determine it from three situations: low, medium and high likelihood in occurring.

Next, determine if it is mainly "good" of "bad". A Remember, if it is creating earnings for you, it is good.

Declare the answer to your group.

Use your formula for the ROI for any capital infusions (i.e. "10X").

Then get clear with your group and guarantee they work well together and will work together through the difficulties ahead.

As a group, define what "the greater great" means to your company.A Make sure the team stays focused on this.

Last but not least, make certain you incorporate the joy component.A What does this mean for you and how will you measure it going forward.

With all this in place, try to find methods to utilize this business instructions with your clients.

Doing these steps will most likely surprise you in how quickly and fun this will be for you.