Is your business strategically resilient?
By Ann-Marie Kellaway
In my opinion, one of the biggest “business” takeaways from 2020 and the COVID pandemic is the need to ensure your organization’s adaptability. I believe the financial impact of 2020 will be felt for years to come so it’s imperative that you build strategic resilience into your business. Not only to weather the current storm, but the many unknown storms which lie ahead.
What does strategic resilience mean? It means focusing on 3 things as a starting point.
Strategic clarity – In times of uncertainty, be clear on your mission, your vision and your customer value proposition. Remember you are selling a feeling and meeting a need. Really hone-in on this and stay focused.
Business model agility – this means being flexible in the way we do business. Conduct business across different channels, diversify your products and services, connect with customers in different ways and support a location-independent workforce. Having clear, documented processes and procedures is imperative for business continuity and uncertainty. These are just some of the ways we can maintain flexibility. We were forced down this path during COVID. Let’s fine tune and make it part of our regular business model.
Financial flexibility – this means effective working capital and cash flow management. Create elastic cost structures where possible to enable you to weather the storm more quickly. Keep cost commitments flexible, for example using contractors instead of employees to fill the productivity gaps. Avoid long term contracts and limit unnecessary spend. It also means ensuring we are collecting money in a timely manner and are making use of the available “free” credit we get from suppliers in some cases. We need to build up the cash reserves to see us through the tough times in both our business and personal lives. This helps us sleep more easily at night. It is the first step towards financial freedom.