THE PRINCIPLE OF SECURITY:

Never permit the enemy to acquire an unexpected advantage.
Proper security implies that a commander prevents surprise
of his own forces, maintains his freedom of action, avoids
annoyance by the enemy, and denies information to the
enemy.

Since risk is inherent in war, application of the principle
of security does not imply undue caution and the avoidance
of calculated risk. Security can often be enhanced by the
seizure and retention of the initiative.

The Principle of Security in Business
The primary job of the executive is to assure the survival of the
enterprise. Since all business operations are uncertain and
have no guarantee of success, the executive must be continually
thinking in terms of survival as well as success.

Sometimes the very best defense is a good offense, as in the
case of Robert E. Lee at Chancellorsville. Often the best way to
assure your own security is to be aggressively moving ahead,
attacking, taking and retaining the initiative, making specific decisions
and taking specific actions to assure that you achieve your
business objectives and maintain your position in the market.

Putting aside reserves and providing for your financial
security always requires both thought and sacrifice. Often,
some immediate advantage must be given up to assure longerterm
success and survival.

The best leaders are those who take nothing for granted.
No matter how successful they are, they remain alert. They
guard against the unexpected. They take whatever steps are
necessary to guard against a reversal or setbacks. They practice
the principle of security.

The Key Question for Security
The principle of security in business requires that you always
ask yourself “What is the worst possible thing that could happen
in this situation?”

The Principle of Security—Cover All Your Bases
If there are several things that could go wrong, you ask, “Of
all the things that could go wrong, what is the worst possible
single event that could occur to hurt my business or career?”
Excellent leaders practice “crisis anticipation” as a part of
daily life. They think continually about the future. They look as
far as possible down the road ahead. They continually imagine
the various things that could go wrong and think about what
they would do to ensure that those things do not happen.

Your ability to achieve and maintain security for yourself
and your business is a key leadership quality. It is a vital and
active way of thinking and the guarantor against costly setbacks
and disappointments. Planning for security can give you the
winning edge in a close situation.

Secure Your Competitive Advantage
In business, you identify your most important products and
services and the competitive advantage that you have in those
products and services over your competitors. The best business
leaders are adamant about maintaining their positions in
the marketplace. They continuously improve the quality of
their products and services to ensure that their competitors
cannot get ahead of them.

The best companies spend more time and money on
research and development of new products and processes
than average companies do. They continually upgrade their
management information systems and their internal operations.
They are determined to stay ahead of their rivals. They
leave nothing to chance. They know that their competitors are
thinking day and night about taking away their customers and
putting them out of business, and they are determined to
make sure that that does not happen.

Identify Your Most Vital Customers
The principle of security in business refers, among other
things, to sales and cash flow. You must therefore safeguard
and protect against the loss of your top customers in every way
possible. Once you have made a sale and captured a customer,
you must do everything possible to ensure that you keep that
customer indefinitely. The cost of acquiring a new customer is
ten to fifteen times as much as the cost of servicing an existing
customer. Repeat sales from your existing customers have the
lowest cost of acquisition and represent the highest profit per
sale of any business that you do.

Make it a policy to do everything possible to secure against
the loss or disloyalty of your best customers. Many individuals
and organizations spend an enormous amount of time and
energy to get a customer for the first time, but then they just
assume that the customer will stay around. They spend less
and less time and energy to keep that customer loyal.

The natural tendency in all relationships is toward entropy,
a running down of energy and increased disorder. Entropy in
sales and marketing refers to the tendency to take your customers
for granted once you have acquired them. This can be
fatal.

Many companies have actually gone out of business as
the result of losing a major customer, or customer group, that
they stopped paying attention to.

You should spend a full third of your advertising and promotional
expenses on your most recent customers. These are the
ones who are the most likely to buy again and to tell their friends.