The people in your business are key because they make your business work. They are the main drivers of relationship. If you accept that business is a set of commercial relationships between people and the products or services you sell, then maintaining that relationship is critical.
In times of hardship it is imperative that you align people alongside your systems and processes and identify those that are critical to face to face delivery of your product or service and those that are critical to delivery internally.
Those that are not critical in the short term, once identified you can then tailor resource to the demand. For example, in the NHS, specialist doctors are being redeployed to more mainstream care even though they are actually not trained to do so. (Better than you or me doing it though!).
Where there's no face to face requirement people can be asked to work from home. Where operational, these can be resourced according to demand, again with a significant proportion remaining at home. Splitting the operational workforce into teams can mean some are at home whilst others run alternating skeleton services internally. Of the face to face staff then clearly this provides a challenge. Today’s technology can really help here but before diving straight into that - ask your buyers first.
It’s all very well moving to Zoom and Teams but if the buyer is not competent in these areas, then investment in training your end may well be pointless. And if all else fails then applying social distancing government guidelines on how to deal with face to face is the best option.
No matter how good your product or service, the thing that kills an organisation is lack of cash. When you get to a certain size with proven cash flow, you can always approach government and seek a bailout, a tax-payer backed loan that is a better use of tax than adding thousands of people to unemployment entitlement.
Furlough keeps skills in the workforce and that money continues to circulate in the economy. When you are smaller, as 99.9% of all businesses are, then such a handout from Boris is not as easy. If there are grants ,they won’t make it easy. So pay attention and get on to it straight away it really is first come first served. Seek help from those that can e.g. your accountant should be able to help.
You have to watch the cash like a hawk.
Identify the inflow and the outflow with a level of due diligence that is probably at a level of minutiae you’ve never experienced before. Kill all ‘nice to haves’ immediately, reduce costs wherever you can and delay payments wherever you can, especially with those that might be able to withstand your hit, e.g. VAT, Corporation tax, mortgage payments, utilities, landlords etc. Talk to everyone about how they might be able to help.
Try and keep payments up to the small guys like you. Cash musical chairs is no fun, i.e. when the cash stops the company who didn’t get paid goes bust. Maybe ‘it won’t be us‘ is fair enough but when we all fire up again the loss of trusted suppliers will have a serious drag on the ability for your business to accelerate again.Talk to everyone about where they are. Those that are more resilient should try and help you. And if you can help others then do so. This becomes a true community effort.
Put in place active cash collection. Get invoices out and, if you can, incentivise payment with perhaps early payment discounts. The more cash at hand the more resilient you become. Holding out for the “right” payment may be good for your pride but you can’t pay too many people on a promise.Get your debtor days down whilst extending your creditor days if you can.
Cancel all blue skies, new product development, recruitment, training projects with immediate effect.You’ll note I have not included marketing. Now I am biased but research undertaken during recessions always shows the same thing. Those that maintain a presence in the market during a recessionary period come out of it significantly faster than those that go quiet and start out once the good times appear to be returning.
Notwithstanding people still need stuff during the recession too and it is more cost-effective to go to those who are active in the recession than those who are struggling. I am also a realist and I would only spend on maintenance of presence and not on speculative market generating campaigns. Pay as little as you can get away with. Find new suppliers, potentially talk to your staff about what minimum they can survive on – they will appreciate continuous employment over and above you going out of business.
Now, this may be a strange one but recessionary thinking is really useful for a business. If you sell your time for money then use your time to make money. Find new ways to do what you do more efficiently, repurpose what you do using new technology, create new ways of buying from you. This may have a cost but the returns might be better than what you do now.
And if all this fails, borrow money from anyone who will lend it. Especially if you have an asset like a property or machinery. One of the most effective ways to boost cash flow is to take out a loan and inject the cash straight into your business. If you don’t have an asset then don’t give up. Forget going to your bank, their need to adhere to BASEL 3 financial rules means they’ll throw you a line but then remove it at the end. And that usually takes about 10 weeks! Go for the alternative lending sector like Funding Circle, Just Cashflow, Starling, there are many others. Sure, they might cost a little more but they can do deals in a matter of days and might give you enough to survive a downturn.
You have built a business around something you are good at and now is the time to share that with everyone and anyone.The trouble is that in building your business you have probably purposefully hidden all the good stuff that made you go into business in the first place. Now is the time to dig back into what got you here and code it into your personal vault of intellect.
Every business has subject matter expertise and in times of need, people could really do with what you know.
Now is the time to sock it to them right between the eyes.And that’s the key. Where are the eyes right now? By capturing all your IP in one place you can focus on finding new distribution channels for that IP: Video, Podcast, Webinar, Email, Website, Masterminds, Forums, Speaking Platforms, Online training and so on.
By dovetailing different delivery channels together, you can start to build new business models that build relationships and can then be commercialised.People will pay for your know-how, your expertise, your dedication to your craft. And they are looking for you too. Right now. Seeking the best source of information to help them navigate their own challenges.Now is a great time to max out your IP.
In truth, the successful businesses are those that follow a level of rigour that only systems and processes provide. Without these, time and money is simply wasted doing the same thing over and over again in a different way.
The key to resilience is to be in the know about how your business is performing. The only way to do this is to have defined business systems supported by defined processes.
You have to map the whole journey for your buyers to make sure that they are receiving maximum value and put what you can on a rinse and repeat programme. If you provide a bespoke service or product every time, then you will never know if you are getting it right. Customer satisfaction is not a reflection on the efficiency or effectiveness of your business, it is a take out by your buyer and is more a reflection of where they are rather than where you are.
To build resilience, you have to flat pack everything you do and then monitor it to ensure it remains fit for purpose, making adjustments when it no longer delivers to your intended standards of buyer satisfaction.
Eat the operation elephant one bite at a time and once a process is built, move to the next part of the operation and so on until you reach a point where the business is one which needs monitoring rather than constant development.
If you get this far then there is a good chance you are working on your business and not in it and you have every chance of survival in tough times or the ability to scale once tough times have passed.Map everything, document the way you do things. Do it as if you were explaining it to a 16-year-old. It’s hard but each thing you capture is one less thing to think about going forward so it frees you up to concentrate on more pressing challenges.
In tough times you need to be extremely mindful of your source materials.No good having state of the art machines, the top people, plenty of cash if the basic raw materials are not there.
You need to ring-fence the right amount of raw material to ensure your business can work. Marketing is often one overlooked raw material or, put another way – leads.
Whatever you are selling, you have to generate leads otherwise you cannot feed the machine that is your business.In just the same way you need a sheet of metal to make things, you need leads to drive your business.
But only get what you need.
Too much and you’ll be overstretched or leave money on the table because you cannot serve everyone. Too few and you overproduce your products or you are over resourced to provide the service.
This really is lean business thinking, input equals output. No more no less.
This has to be another focal point to ensure resilience.
Well, I hadn’t intended writing so much. Yet this only scratches the surface.It is time for the leaders to step up and with support, enable us all to survive unprecedented times and keep our communities safe and well. We may have pressed a reset button but with resilience, the fittest will be the survivors.