Learning Business Finance from the Game of Thrones
After going through all the carnage, today’s leading businesses in the financial world have raised to their rightful top position. So what exactly can we learn from their financial success?
Game of Thrones is arguably one of the most popular TV shows ever with millions of followers across the world. The show dominates the headlines whenever a new episode airs and for many diehard fans it is considered as the peak of entertainment.
But, why are we talking about Game of Thrones while discussing business finance? It is just an entertainment show, right?
(Even though it is a fictional world, the land of Westeros (as termed in the TV show) is believed to have firm establishment on being realistic). Whether it is politics or business finance, the lives portrayed in G.R.R Martin’s fantasy has a noticeable correspondence with the real-world. In other words, it means that underneath the famous swords and sorcery, one can learn various real-world tactics from the show.
In the real-world, entrepreneurs are said to gain their wisdom from the failures they face. These failures eventually help them and their business to succeed and keep progressing.
Here are some takeaways from the popular show that can be linked to business finance.
Pay your Debts. Always!
As seen in the most recent season, the famous sass Queen Cersei reminds the Iron Bank that Lannisters always pays their debts. The constant repetition of this statement from the Lannisters can be annoying but these famous words can actually be considered very sound business finance advice.
It shows that the famous House of Lannister has built its reputation by paying back the money they owe. Because of this reason, the House Lannister never faces any issues while raising funds from the Iron Bank and making deals with other strong allies. Moreover, this reputation of Lannisters has even saved them big time on certain occasions.
If you are a keen observer and a true fan of the series, you might have noticed that other houses in the Westeros are not so trusted for business finance, especially when it comes to repayments (which has moved on to cost them a lot). As we saw, Stannis Baratheon’s army of 2000 sellswords abandoned him on the battlefield. Reason being, they did not trust their king would appreciate their efforts, if the war was won.
If the House of Lannisters did not have a reputation of being trustworthy debtors, Tyrion Lannister would not have survived this far. As a matter of fact, in the real-world, your business will not survive either, if you don’t build a similar reputation.
Reputation and the credit score of a business are the two essential factors in the financial world. Keeping these on the top will help your business gain trust of the investors as well as the suppliers.
Once the trust is gained, it becomes easy for a business to secure funds. There are various alternative finance options provided by funding companies to businesses in need only because they trust them.
If your business fails to acquire trust and has a negative reputation in the financial world, you will find that the market ignores you exactly the way the Iron Bank ignores other houses in the Westeros.
A smart company is prepared to pivot
All these years, the gold beneath Casterly Rock kept the Lannisters extremely wealthy. But just like ‘Valar Morghulis’, all financial resources might dry (up). In the show The Great Lord Tywin Lannister admits to his dearest daughter Cersei that the family is officially out of gold.
Despite this, the House Lannister has managed to successfully maintain the greatest fortune in the lands of Westeros. How?
Perhaps, Lord Tywin Lannister is the greatest business finance mind in the show. He ensures that his House follows a well-structured business model because of which he can manage the greatest of financial achievements; a complete business pivot.
In the business world, when the primary approach of income fails, many a time it leads to the downfall of the business as a result. But, lord Tywin did not let the scarcity of gold send his famously strong House hurtling into obscurity. As a matter of fact, he made efforts to invest his resources in searching for new ways of making money. The House of Lannister no longer relies on gold mines for its wealth. Instead it relies on taxation and the spoils of war.
Taking Lord Tywin as an example, businesses need to ensure that they do not fail when one source of income dries up. A business should invest its resources in finding other sources of income for continuing their daily operations. Just like the way Lannisters use their influence and power to back a rebellion and claim the Iron Throne.
If your business is facing a somewhat similar situation as Lord Tywin, it might not be possible to earn a new income through war but you can instead look for ways to make some money, right?
Winter is coming!
Isn’t this familiar?
It took an entire year for the winter to finally arrive and it is going to take two more years to see how it ends. We have no idea what unexpected turn of events it will bring or what will happen in the end. But something is surely arriving and is bound to change everything.
These kinds of situations place a lot of pressure on us, especially something that arrives without a prior warning or something that is impossible to overcome. In terms of Game of Thrones, these situations sound more like the winter projected by our very own Jon Snow.
However, in the context of the business world, it is more likely to be a financial obstruction caused by events such as a market crash or a shift in consumer demand.
Just like the remaining characters in the series, the only way to survive this financial winter is by preparing yourself. As you see in the show, the Winterfell is preparing for the winter by gathering food supplies, making their defences stronger and by training their army for what is to come.
Unlike other Houses, those are mainly focused on their current situation (winning the Iron Throne). This means that when winter finally does come the other houses are all unprepared and slaughtered to death.
Similarly, when businesses avoid potential financial problems that they might face, they are in no state to overcome these problems when it finally hits them. When a financial crisis comes upon, many businesses fail as they did not prepare for the crisis. Businesses that make it through this storm are the ones who were able to adapt and were prepared to meet such an eventuality.