Unfortunately, it takes a significant act of nature or a condition with a big impact on the bottom line to change many mental models. Lee Iacocca writes with great emotion about coming to grips with the mass firings at Chrysler. “At one point in April 1980, we cut our white-collar ranks by 7,000 people, a move that saved us over $200 million a year. A few months earlier, we had laid off 8,500 salaried workers. These two moves alone cut out $500 million in annual costs.” While it was painful to Iacocca it was also necessary because of the bad mental models in place at Chrysler over an extended period of time. If you are going to plan for change, make it a big change, and then make it bigger. Don’t wait for events to force change. Do a preemptive strike on the problem before it becomes a problem.
Not all contingency plans are for bad conditions and bad times. There needs to be thought given to what happens if you exceed your targets. Too much growth can kill you more quickly than slow growth. With the latter case you just hang on until eventually your business dies. With excessive growth the demise is much quicker. Rapid growth has significant implications when it comes to resources. Where will you get the resources to fill all the new orders or the one large order that came from nowhere? Your contingency plan may include giving up some work to save the company. One example of fast growth challenging a company is AOL’s trouble scaling its servers for all kinds of new users in the mid-1990s.