Unemployment is officially at 9.1%. If you include people who have given up looking for work, it is actually much worse - around 16.2%. The United States economy has not created any net new jobs in 9 months, and the poverty rate has increased to the highest level (15%) since 1993. A total of 46.2 million people are officially living below the poverty level - the highest number since the Census Bureau began measuring this statistic over 50 years ago. Meanwhile, investors are not investing, banks are not lending, and consumers are not spending. Most economists say things will probably not get much better for at least a year or two.

So is the best strategy to just hold your breath, wait this out, and then come up for air when things improve?

NO.

While things do seem pretty grim, time has not stopped. The earth is still spinning, and the sun still rises in the east each and every day. China is building infrastructure and technology at a dizzying pace. Brazil is growing stronger by the minute, and India is also gaining ground. New technologies, inventions, processes, products, and services are being developed around the world, even here in the United States. The only reason you don't hear about them is because doom and gloom dominate the media. But don't fool yourself: if you do not adapt and innovate, you will slowly fall behind your competitors. And even if your current competition is asleep, new competitors will soon appear.

Pick an industry, any industry. How about news media? The conventional wisdom is that news media is dying. A few years ago some experts even predicted the extinction of investigative journalism. But while the mainstream newspapers have lost circulation, lost advertising power, and lost money, others have rushed in to fill the vacuum. Huffington Post, Politico, Talking Points Memo, and dozens of others have grown from almost nothing into real players.

Other, older organizations such as Mother Jones, The Nation, and Rolling Stone used to be considered second tier. But lately they have been scooping the New York Times, the Wall Street Journal, and the Washington Post. Not only have they gained market share, they have gained respectability by uncovering stories that others assumed could not be uncovered, or didn't even exist.

There is an "opportunity cost" to not moving forward, not trying new things, and not sticking your neck out once in a while. This is one of the basic tenets of planning - when considering the advantages and disadvantages of Option A, you should also consider the advantages and disadvantages of Options B and C. In our current economic stalemate, most businesses seem content to avoid "taking risk." But by not taking an apparent risk, they are nevertheless taking a real risk - the risk of being left behind.

Consider another example: the construction industry. While the media focus on the huge downward spiral in residential and commercial construction over the past five years, everybody has not lost out. In fact, while there are many losers, there are also some small (and big) winners.

I recently spoke to owners at three small construction firms in Chicago. All of them have grown substantially in the past 12 to 18 months, and now they have the enviable problem of trying to manage their growth so it doesn't spiral out of control.  

Each took a different approach, but none of them sat on their hands hoping for better days. One embraced the world of LEED construction and sustainability. They partnered with like-minded architects and other professionals. Their clear value proposition and single-minded focus helped them grow while the surrounding market shrank. Another firm embraced small projects just to get their foot in the door. Their use of social media combined with truly superior customer service led to much larger projects.  

The third firm hired my company, Ground Floor Partners, before the downturn, and, partly because of our help, they not only survived the past few years, but now they are thriving. Their "secret" was to strip away unprofitable and distracting services and to strengthen their core offering, remodeling. They focused like a laser on the neighborhoods they know best, and they avoided capitulating on price. Many of their competitors have now gone out of business. My client is now gaining market share at the expense of their competitors. When the local construction market turns around, they will be able to grow even faster.