November 5, 2017

The Economy Needs a Human Touch

Bruce Yandle

Distinguished Adjunct Fellow
Summary

Businesses can counter a slowing economy by reaffirming their commitment to personnel and customers.

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The American economy is sleepwalking. With a plodding 2.3 to 2.5 percent real gross domestic product growth, we're not in full slumber, but not awake enough to move forward in full force. And thanks to similarly slow workforce and productivity growth, sleepwalking may be about all we can expect for the nation over the next 12 to 18 months.

But while the nation is trudging along, there is wide variation in what is happening across the 50 states. For example, the unemployment rate in October varied from a low of 2.4 percent in North Dakota to a high of 7.2 percent in Alaska. How one is doing depends partly on where one is living.

No matter where we live or how our particular ZIP code may be doing, we don't have to accept our place as small cogs in a sputtering machine. Business owners seeking to grow, hire and thrive face a double-barreled question: Will the U.S. economy somehow escape its current sleepwalking pace, and is there anything they can do to make things better?

On the one hand, the forces that determine our national economic activity are deep and wide, and there is little, if anything, that most single businesses – or even most groups of businesses – can do to affect the nation's economic destiny. The economy is like a self-driving car without a steering wheel – an emergent system that results from countless individual decisions and components, large and small, leaving us as passengers who don't come close to affecting the pace or direction of economic activity.

Of course, there are statutes, treaties, monetary policies – which act like software that guides human action – and a government with its hands on certain economic levers. But still, the economy has a mind of its own.

Current economic malaise notwithstanding, this is healthy. In a sort of wonderful way, there is no one is in charge of market-based economies. There is no Wizard of Oz.

On the other hand, while it's beyond the power of individual businesses to affect national economic trends, it is well within their power to decide if they will succumb to them. Whether to be a sleepwalking or an expanding business is a matter of choice, no matter what the larger economy might be doing.

But how? What can individual businesses, churches or other organizations do to counter the effects of a slow-running national economy?

First, we must remember the power of the mind. Napoleon Hill, author of the classic "Think and Grow Rich," insists that thoughts are tangible things and that what the mind can conceive and believe, it can achieve. Of course, believing is the hard part, but just being optimistic can make a positive difference.

Then, we must think about human interaction. Each day, business people and operators of other enterprises make contact with customers, clients and members. More contact leads eventually to more business.

Consider this. As you go about visiting clients and customers, after you make your last call each day, make one more. Generally speaking, sales people make eight to 10 calls on a good day. Making one more yields a 10 to 12 percent increase in potential activity.

Then, when things are getting quiet, take a few minutes to write notes – by hand – to good customers or to folks you wish were customers, wishing them well or thanking them for their patronage. Go a step further and think about colleagues or employees who are doing yet-to-be recognized good jobs. Send them a random note of appreciation, too.

However, by all means, don't mechanize the process with emails and text messages. Why? Not because they aren't useful –because they've become commonplace. Hand-written, human-to-human contact now stands out once again.

What else? Be positive and avoid pessimists like the plague. Optimism is contagious. Pessimism is, too.

Ultimately, people do business with people. Successful businesses recognize that, despite the sheer size and complexity of our economy, it's ultimately a collection of human beings. Taking steps to show real appreciation and concern for others can counter the slow forces of a sleepwalking national economy. And just maybe, they will stand out in a business world increasingly defined by technological change.

Whether sleepwalking or expanding, there's always an element of choice.