By Tim Williams

Times are indeed tough. Most of us have never experienced an economic recession of this magnitude. Virtually every agency – from the smallest independent to the largest multinational – has experienced a wave of layoffs. Some firms have implemented across-the-board pay reductions, furloughs, or cut the length of the work week. Many have suspended 401k contributions and reduced agency-funded insurance benefits.

There’s no doubt that cost cutting is an absolute necessity at a time when clients are reducing budgets, delaying projects, or just cancelling work altogether. Clients are paying later and banks are cutting or freezing agency credit lines, creating a dangerous and uneasy cash flow crunch for firms everywhere.

You only have so much time in the day.  How are you going to spend it?

This is a time when our problems – especially those of the financial variety – confront us squarely every day that we come to work. Our natural reaction to income and profit pressures is to keep pruning; no more discretionary travel, no more administrative help, no more free parking, and no more complimentary sodas in the fridge. But there comes a point where it’s simply no longer possible to save our way to success.

The danger is that we’re devoting so much time and attention to the problems that we’re failing to pursue the opportunities. Peter Drucker believed that far too much time is spent trying to fix problems at the expense of developing all the remarkable potential that surrounds us. His philosophy “Feed the opportunities and starve the problems” is arguably even more relevant when times are tough. Cutting expenses may be necessary, but it’s hardly a business strategy

Trading problems for opportunities

If you put all of your time and energy into squeezing more costs out of the system, there’s no time or energy left to work on the very things that could help pull your firm out of the situation it’s in. Yes, even the very best agencies have had to reduce their expenses; so has virtually every company in America. But the best agencies are also continuing to innovate, develop new services, and find better ways to get paid for the value they create.

Perhaps you’ve eliminated all magazine subscriptions; but have you invested time and energy in developing a new social media capability? You may have a plan to ask everyone to take a week’s unpaid vacation; but do you have a plan to develop an analytics function that could help prove the value of your work to clients? You have spent late nights and weekends poring over billable time reports; but have you devoted time to developing proactive, game-changing ideas for your clients?

The decision to invest in yourself isn’t made by your balance sheet. As economist Alan Weiss preaches, “Money is never a resource issue; it’s a priority issue.”

What will your business look like?

“Feed the opportunities and starve the problems.” - Peter Drucker

When the economic crisis is over, what do you think the agency business will look like? Most economists believe the business world will be changed forever. Do you really want to emerge from the crisis as the same agency, or do you believe there’s an opportunity to emerge as an even better agency, prepared to take advantage of new waves of spending and investment? Instead of hunkering down until the storm passes, see this as the opportunity you’ve been looking for to reinvent your agency.

The future success of your firm hinges on how you focus our energy right now. Avoid the trap of being so consumed by today that you neglect tomorrow. Problems contribute nothing to your firm’s success; opportunities contribute everything.