​U.S. Naval Aviation Survival Techniques and Your Business

Mike Quinlan CDR, USN (Ret) | Certified Exit Planner
Brightworth Business Exit and Transitions (BETS) Team

 

During my career as a Naval Flight Officer, I logged over 3,000 hours of flight time in various models of the land-based P-3 Orion and the aircraft carrier-based S-3A Viking.  Both aircraft were designed for anti-submarine and anti-surface warfare.  Our typical mission was to fly over the open ocean, descend to between 200 and 300 feet above the water and search, locate and prosecute hostile submarines.  In the P-3, those missions usually lasted 8-12 hours and were flown hundreds of miles away from the nearest land mass.  Often, they were conducted at night and unfortunately, many times, were conducted in bad weather. 

Due to the remote environment in which we operated; we were trained to survive a situation where the aircraft had to be ditched at sea. The training we received prepared us for the impact and egress, an extended water or land survival phase followed by rescue and recovery.  Many of those lessons are directly relatable to our current national health crisis and its impact to the economy and our businesses.

On January 21st, 2020 COVID-19 transitioned from a China and Rest-of-World problem to become a U.S. problem, as the first case on U.S. soil was reported.  Most business owners were slow to recognize the issues they were going to be faced with…..In aviation terms, the number one engine was running rough.

On February 29th, 2020 COVID-19 had claimed its first U.S. victim. Business owners were returning from winter ski trips or planning for the upcoming spring break……Now, the number one engine oil and temperature indications were fluctuating. 

On March 13th, 2020 President Trump declares a National emergency and the DOW Jones Industrial Average hits 22,767, down 23% from 29,568….The number one engine explodes.  The number 4 blade of the propeller is thrown through the fuselage severing control, fuel and hydraulic lines.  We are going in the water!!

March 23rd, IMPACT! – The DOW Jones Industrial Average bottoms out at 18,591 and President Trump signs a $2 trillion dollar stimulus bill, all while State Governors are signing stay at home orders and shuttering non-essential businesses.  Most business owners are in shock from the impact.  So how do you survive and ultimately thrive and grow stronger coming out of the crisis?

The first phase of ditching at sea is surviving the impact, getting into the life raft and administering lifesaving first aid.  As you read this article, you’ve been in the water for a month, have survived impact, and have likely administered lifesaving first aid by virtue of accessing the SBA Disaster Relief Loan and/or the Paycheck Protection Program.  Now comes the hard part.  How do you and your company “thrive” during this period of economic dislocation?  The answer is always to rely on your training.  In the Navy, we were trained to deal with survival situations and you, as a business owner were “trained” by virtue of conceptualizing and building a successful company. You learned how to make innovative products and services, sell, manage processes and lead people.

The second phase of survival is adapting to your new environment and utilizing your resources to improve your situation.  The first step is to take inventory of your resources.  Use the I.M.G.O.O.D.™ checklist as a framework as it is a key driver to the enterprise value of your business.  During this inventory process you will likely look at:

  • I – Increasing/maintaining cash flow
  • M - Management and human capital
  • G – Growth through current sales and innovative opportunities
  • O – Optimizing financials including cost control, supply chain, cash cycle (A/R, A/P), PPP accounting, balance sheet and optimizing terms and access to capital
  • O - Operational processes and procedures, insurance, legal, regulatory compliance and HR
  • D – Diversity of customers

As you and your management team take inventory of your resources, it will provide clarity and a platform for innovation and creativity.  Your inventory will help you and your team avoid panic and rash decision making. 

Once the inventory is complete, it is time to get to work on activities that yield cash flow or are directly improving elements of the I.M.G.O.O.D.™ checklist.  This is a time to attack the work with a positive attitude and mental toughness.  In the life raft, the ones who don’t make it are typically the ones who focus on the negatives of their situation, become morose and lose the will to survive.  This is portrayed well in the life raft scenes from the 2014 film Unbroken, where Louis Zamperini, his pilot and his crew chief survived a crash at sea and were adrift for 2000nm and 47 days.  The otherwise young and healthy crew chief perished not from injuries, but from a loss of his will to live.  Your business is the exact same way.  If you are looking at the negatives of the COVID-19 pandemic and the effect on your business, how can you unlock creativity and innovation?  How can you survive and thrive?

The press is full of reports detailing how the world is going to look after the pandemic is over.  They opine on duration of the recovery, consumer behavior and spending patterns.  The proliferation of negative news can shape or stifle your ability to create and innovate within your industry.  During the writing of this article, Governor Kemp eased restrictions on Georgia’s stay-at-home order.  The Governors of Tennessee and South Carolina also are relaxing restrictions.  Realize this is not likely a one and done scenario and people’s perceptions and emotions around the health crisis will linger for a period of time.  Challenge yourself and your team to sit down in a quiet space and write down 10 ways the COVID-19 pandemic may change your behaviors over the next 12 to 36 months.  Then, sit down with your team and discuss what you have written.  It is likely, you and your team will generate insights leading to ways you can GROW – ADAPT – AND OVERCOME.  It is a valuable exercise.

You may be lucky and be in a business that is not greatly impacted by stay-at-home orders.  Internet retailers are doing well.  Delivery and shipping businesses are doing well.  Supply chains are holding up, with the exception of toilet paper!  Some businesses are impacted primarily by physical limitations put on their customers.  Other businesses are impacted not by the physical limitations on their customers but by economic conditions which impact sales of products commonly purchased with discretionary dollars.  Regardless of your business model, analyzing your resources and being proactive will give you a better chance for success.  Here are examples of two companies who have taken action to “thrive” vs. “survive”.

  1. The first business is a Georgia based maker of specialty health and beauty consumer products.  The nature of the product is highly discretionary, and demand is impacted by economic down turns.  The management team utilized the I.M.G.O.O.D.™ checklist as a framework to inventory resources for their business.  They focused on modification of their operational capability to transition to production of pharmaceutical grade hand sanitizers for hospitals and medical facilities.  The team resisted the temptation to broaden the offering to retail customers and focused on the higher margin specialty product.  The company utilized current and new vendors to diversify their supply chain and mitigate any supply disruptions.  The sales manager and operations manager were empowered to manage their personnel to new production and sales schedules.  The President and CFO completed detailed financial pro-forma calculations for the new line of business and scenarios for re-engaging in the core production processes.  The company has not lost sight of their core strategic plan and will use this cash flow to grow their core business.
  2. The second business is an Atlanta-based restaurant forced to only take-out or delivery service.  They've inventoried their resources and devised a support model for local health care workers.  They combined their customer’s desire to help those on the front lines of the health crisis with their delicious food offering by selling meals and requesting a cash donation to provide meals to hospital employees.  They deliver meals daily to the hospital and communicate back to their customers how their donation helped.  Everyone is contributing, the business is thriving, and their newly acquired brand recognition is off the charts.  They are going to be in a very strong position to gain market share as the crisis subsides.

The third phase of survival is rescue and re-integration.  After the rescue, the most successful survivors use what they have learned from the experience and flourish.  In a business context, they would aggressively pursue growth.  Using I.M.G.O.O.D.™, they would identify weaknesses in their business and use the strength of their management team to make changes to better weather the next crisis and bolster long-term enterprise value.

Be upbeat and positive; stay mentally tough; motivate your team and take care of your people; use their brilliance; inventory your resources; create and innovate; EXECUTE!

The mission of the Brightworth Business Exit and Transition Services Team is to prepare business owners for transition by increasing the probability and value of their exit in alignment with their personal definition of Success.  For additional information please contact us at 404-760-9000.

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