How Should Entrepreneurs Prepare for an Election Disaster?
It’s less than a week until one of the most anticipated presidential elections in U.S. history. However, are you and your enterprise prepared for the possibility of a disastrous outcome?
It’s not nearly as impossible as you might think. Politicians and political experts closely watching the run-up to Nov. 3 have astutely voiced concern over legal issues that may be on the horizon and could lead to the counting dragging on for weeks, which may trigger widespread civil disturbances, economic turmoil and even a Constitutional crisis.
If your gut is telling you that if it’s never happened before, it probably won’t happen this time, I advise you to think back not only to the contested 2000 presidential election, but back to last spring. Many businesses were unprepared for the slew of problems that Covid dumped on us, and this is because our brains have a tendency to gloss over “black swans,” which are low-probability/high-impact events.
This tendency is deeply rooted in dangerous judgment errors that researchers in behavioral economics and cognitive neuroscience refer to as cognitive biases. These mental blindspots have a strong impact on all areas of our life, shaping our decisions regarding our health, politics and even shopping.
Cognitive Biases and Election Risk
Essentially, three cognitive biases are the culprit for potential unwillingness to face up to the truth that an election disaster is possible. The normalcy bias goads our brain into thinking things will stay as they are, encouraging us to plan for the near-term future based on short-term past experience. The result? We unwisely underestimate the possibility and impact of a widespread disruption, such as a Constitutional crisis.
Then, there’s the confirmation bias, which entices us to choose data that supports our pre-existing beliefs and what our gut tells us, while dismissing information that goes against it. In this case, confirmation bias encourages us to deny the possibility of an election disaster.
Finally, there’s the planning fallacy, a mental blindspot that causes us to make plans while assuming that the future will go as planned, only for things to go sideways because we’re not prepared for unexpected events. This dangerous judgment error fits right in with black swan-type scenarios like an election disaster.
Fortunately, there’s an effective way to confront these cognitive biases head on. But first, you need to assign a probability to each election-disaster scenario. For instance, what’s the probability that legal issues and civil disturbances will cause the counting of mail-in ballots to drag on until the Electoral College votes on December 14? Given that leaders from both parties have extensively prepared for post-election vote counting, I would say the probability is no less than 30 percent (but go ahead and assign your own number if you want).
Next, what’s the probability that the Electoral College will vote inconclusively due to legal problems? I would estimate this to be at 15 percent. At that juncture, the House of Representatives will have to pick a winner. Take note, however, that both parties have the means to cause a stalemate, which could then lead to a Constitutional crisis too complex to resolve quickly. I would say the chances that this could happen is at 10 percent.
Stepping Up Your Disaster Game Plan
Now, imagine how the future would look like if the civil disturbance and legal problems continued only until the Electoral College vote. You'll need to anticipate the problems you’re bound to encounter and come up with appropriate solutions. Review your business-continuity plan ASAP. Most companies that were gravely unprepared for the pandemic didn’t revise their plan quickly. If you haven’t fully transitioned your business to a remote-work model yet, now would be a good time to prepare for it. If this isn’t possible, get extra security for your office to be ready for possible civil disturbances.
Inform your employees that an election disaster might happen and ask them to prepare themselves as early as possible. If available, don’t forget to remind them about access to mental-health resources provided by the company, such as through an Employee Assistance Program. Be prepared for reduced productivity in case some of your employees suffer disruptions in their work. Ensure that the more critical roles are covered by assigning employees cross-trained for the positions as back-ups.
If you manufacture products, assess where you’ll need to make changes to protect your supply chains. If you’re a service provider, reach out to clients and assure them that you are taking appropriate measures to avoid interruptions.
Next, identify how many resources you need to prepare for the expected problems. Add them up, multiply the sum by 30 percent, and those will be the resources at your disposal in case of a disruption.
After that, think about the problems you might encounter in case the Electoral College fails to deliver a decisive vote and the chaos continues until early January. Identify the resources you’ll need to solve the problems and multiply them by 15 percent.
Finally, identify the problems and corresponding resources you’ll need if the House voting results in a stalemate that causes a Constitutional crisis. Multiply the resources by 10 percent.
By using this approach, you’ll be able to distribute your problem-solving and efficiently allocate resources across different scenarios according to your chosen evaluations. Think of it as buying yourself election insurance so that you and your company will be safe from any disruptions caused by whatever gets set in motion next Tuesday night.