Here is an excerpt from an article written by Michael Watkins for the HBR Blog Network. To read the complete article, check out the wealth of free resources, and sign up for a subscription to HBR email alerts, please click here.

* * *

The morning after a hard-fought campaign is the time to savor the sweet taste of victory. And what a campaign it has been, scaling new political heights and plumbing new lows. So enjoy the morning after Mr. President, because that’s really all the time you can afford.

You lead a nation divided, depleted and at a cross-roads. You have four more years to make a difference. The first 100 days of your second (and last) administration will set the tone for all that follows. You need to move boldly to create momentum by securing some early wins in both domestic and international spheres. At the same time you need to avoid some classic transition traps, in particular trying to do too much too fast. Focus unquestionably is the key to success.

In the domestic realm, your overarching priority is to sustain and accelerate the economic recovery. Here are three things you need to do:

Talk Congress down off the ledge. We are not on a fiscal cliff. Rather, Congress has taken the nation high up on a narrow ledge and is threatening to push us off. Unless the budget stalemate is resolved by the end of the year, crippling tax increases and draconian spending cuts automatically will take effect. More than 25 million middle-class households will face the Alternative Minimum Tax for the first time, which would add an average of $3,700 onto taxpayers’ bills. Income reductions will sharply curtain consumer spending; a new recession is the likely outcome. Everyone from the country’s best economists to the CEOs of our leading companies agree the answer lies in a “grand bargain” combining some increases in tax revenue with substantial cuts in spending. Your first priority is to force the lame-duck Congress to confront reality.

Stimulate more job growth. The economy remains on a fitful path to recovery. The tools of monetary policy — interest rates cuts and quantitative easing — have been deployed to their maximum potential. The housing market is stabilizing and jobs are being created, but not at a rate that will bring unemployment down to acceptable levels fast enough. Although the idea of spending more to generate economic growth is anathema in some circles, targeted investment in our aging infrastructure remains the single best thing to do to stimulate the economy. Unless growth soon picks up dramatically, your next priority is to push the new Congress to enact a substantial infrastructure investment bill. Yes, it will increase the deficit in the short run, and yes we need to address the structural issues with entitlements, but this is not the time for too much austerity.

Make America more attractive for business, large and small. The United States has one of the highest corporate tax rates in the world. It also has a byzantine tax code riddled with loop holes. The net result is that large companies keep profits off-shore and structure their domestic operations to take maximum advantage of the exceptions — with the net result that many pay little U.S. tax. At the same time, small businesses, which generate the majority of new jobs, are overly weighed down by regulation, hampered by inadequate access to capital, and effectively penalized by being taxed at personal rather than corporate rates. You need to lead the effort to reduce tax rates for companies and streamline the corporate tax regime. You also need to initiate a comprehensive review of how regulation impacts small business, and lead the effort to substantially reduce the burden.

* * *

To read the complete article, please click here.

Michael Watkins is Chairman of Genesis Advisers. He is the author of many books, including The First 90 Days and Your Next Move. To read more of his HBR articles, please click here.