“It’s strange,” Byron said. “A couple of years ago, we were on top of the world. We were the industry leader, now, with COVID and supply chain issues, things are tightening. You just never know.”
“So, this was not predictable?” I asked.
“No, our growth curves just showed, no turning back. I mean, it wasn’t hockey stick growth, but continued growth just the same. We just didn’t think we would ever have to pull in our horns.”
“So, Byron, what’s the purpose for a forest fire?”
“What do you mean? How can a forest fire have a purpose?”
“From an ecological sense?”
Byron thought for a minute. “I have heard that when a forest becomes choked with undergrowth, a fire can clear it out. Though it appears devastating, that’s what brings on new growth.”
“What could that tell us about business cycles?” I probed.
“Sometimes the market gets overgrown and has to be cleared out?” Byron tested.
“Yes, in fact, if you look at macro economic climates, you will see very distinct cycles. Occasionally, there has to be a clearing of the undergrowth. So, what if you looked at your own internal business cycles, within your own company. What do you now see?”
Byron pondered. “I see that, as we grew, some of the things we created weren’t good for the long term health of the company. They seemed like a good idea at the time, but, perhaps, we were just creating undergrowth.”