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Peacetime and Wartime in Business

In my career, I can now say that I've survived and thrived in three economic cycles - 2001,

2008, and now 2022. With each cycle, the teams I work with experience whiplash, panic, fear, and general angst that the hard-won years are over and will never return. Add in a pandemic and a war to make a special plate of shit sandwich. I've got good news, it's going to be ok.

One of the most enduring mentors in my life is Ben Horowitz from a16z. During this time of macroeconomic cycles, it is imperative to change your leadership style to match the events unfolding in the market and your company. Teaching agility, resilience, and a sense of calm in the chaos is one of the most important gifts you can give your teams. There are three must-reads that I require all of my teams to read to prepare them for the journey of building a business and being leaders.

All three articles/books above provide the real day-to-day account of becoming an "overnight" success in business and the reality of finding your true grit and perspective to keep going until you win. Ben's article on Peacetime/Wartime is so good, that I'm shamelessly copying excerpts here because it needs no commentary to enrich or improve its impact on the reader.

...Peacetime in business means those times when a company has a large advantage vs. the competition in its core market, and its market is growing. In times of peace, the company can focus on expanding the market and reinforcing the company’s strengths.
In wartime, a company is fending off an imminent existential threat. Such a threat can come from a wide range of sources including competition, dramatic macro economic change, market change, supply chain change, and so forth. The great wartime CEO Andy Grove marvelously describes the forces that can take a company from peacetime to wartime in his book Only The Paranoid Survive...

The question then becomes, when does your leadership style need to mold with the environment you are in and how do you need to lead based on that environment. Straight from the Horowitz playbook...

Peacetime CEO/Wartime CEO

  • Peacetime CEO knows that proper protocol leads to winning. Wartime CEO violates protocol in order to win.

  • Peacetime CEO focuses on the big picture and empowers her people to make detailed decisions. Wartime CEO cares about a speck of dust on a gnat’s ass if it interferes with the prime directive.

  • Peacetime CEO builds scalable, high-volume recruiting machines. Wartime CEO does that but also builds HR organizations that can execute layoffs.

  • Peacetime CEO spends time defining the culture. Wartime CEO lets the war define the culture.

  • Peacetime CEO always has a contingency plan. Wartime CEO knows that sometimes you gotta roll a hard six.

  • Peacetime CEO knows what to do with a big advantage. Wartime CEO is paranoid.

  • Peacetime CEO strives not to use profanity. Wartime CEO sometimes uses profanity purposefully.

  • Peacetime CEO thinks of the competition as other ships in a big ocean that may never engage. Wartime CEO thinks the competition is sneaking into her house and trying to kidnap her children.

  • Peacetime CEO aims to expand the market. Wartime CEO aims to win the market.

  • Peacetime CEO strives to tolerate deviations from the plan when coupled with effort and creativity. Wartime CEO is completely intolerant.

  • Peacetime CEO does not raise her voice. Wartime CEO rarely speaks in a normal tone.

  • Peacetime CEO works to minimize conflict. Wartime CEO heightens the contradictions.

  • Peacetime CEO strives for broad-based buy-in. Wartime CEO neither indulges in consensus-building nor tolerates disagreements.

  • Peacetime CEO sets big, hairy audacious goals. Wartime CEO is too busy fighting the enemy to read management books written by consultants who have never managed a fruit stand.

  • Peacetime CEO trains her employees to ensure satisfaction and career development. Wartime CEO trains her employees so they don’t get their asses shot off in the battle.

  • Peacetime CEO has rules like “we’re going to exit all businesses where we’re not number 1 or 2.” Wartime CEO often has no businesses that are number 1 or 2 and therefore does not have the luxury of following that rule.

In this current macroeconomic environment, take advantage by shifting your leadership and your team to match the times. And as Scott Belsky would say, your fucking job! Build a company that is resilient and knows what to do in peacetime AND wartime or get your ass shot off in the next market shift.

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