“Climb if you will but remember that courage and strength are nought without prudence, and that a momentary negligence may destroy the happiness of a lifetime. Do nothing in haste; look well to each step; and from the beginning think what may be the end.” ― Edward Whymper
Every crisis, while deeply unsettling, also contains the seeds of new opportunity. When we face the dramatic crisis we do today, we need to remember three things:
How do we cope with this crisis now? This question is uppermost in people’s minds – as it should be. This is crisis management; what is required now to live to see tomorrow.
What opportunities does this crisis create?
What’s next? How do we transform, adapt and ascend what lies ahead?
No one knows with certainty what is going to happen next. Too many talk as if they do. A recession is certain, but it remains unclear how big and how long (U vs V recovery). A moderate recovery is a safer bet any time soon. Unfortunately, several businesses won’t make it. Some were in the wrong place at the wrong time and could not control their outcome. Others lacked the basic business discipline to fight on.
This discussion focuses on what we can control and how to redpoint (free-climb a route w/o falling). As we work to ascend to our best new normal, here are some sure-footed steps you need to take on your route (path up a specific climb-strategic plan) to the top and avoid being a Gumby (an inexperienced or unsafe climber).
Externally:
Define your Ideal Customers. This is even more of a necessity coming out of this crisis. Don’t’ try to be all things to all customers, focus proactively on developing open relationships with customer segments that value your current core competencies. Be an insatiable listener and learn what matters and what does not. Improve alignment to seamlessly and consistently deliver an excellent customer experience across all internal departments. Then work relentlessly to learn and deliver additional layers of compelling value to earn their long-term loyalty. It is recommended that a Customer Service Survey be performed at least twice a year, using the Net Promoter Score. Be aware or beware!
Develop a Comprehensive Marketing Plan. Develop messaging that is compelling and resonates to your ideal customer profile and deploy it across all media; website, social media and email. This is a marathon, not a sprint and you must stay consistent and authentic.
Build Supplier Partners: Perform a Pareto analysis on your key suppliers and look for areas of improvement; relationship, better quality, better pricing, better payment terms, better services, etc. Conduct a supplier audit of your key current suppliers and potential new suppliers annually to define gaps and risks.
Internally:
Business health checks. “Revenue is vanity, profit is sanity and cash is reality”. Positive cash flow – not revenue, profit, nor ‘retained earnings’ either – is the lifeblood of every successful enterprise. Timely and accurate financial reporting are a must in this environment to enable a measured response to events before it is too late. Routine forecasting with a good understanding of the revenue and cost drivers. Accelerating cash conversion is key. Cash flow projections for 4-8 weeks out and assigning someone to aggressively focus on reducing your days outstanding AR (i.e. invoice accuracy, collection persistence, partial payments, and tightening up on your payment terms on new contracts). Make sure you secure necessary working capital to cover any shortfalls in cash; line of credit and loans/grants.
First Who, Then What. Take stock in your talent! To adapt to our changing world, get the right people on the bus, in their best seats and the wrong people off now.
Build your ideal organizational design and culture with emphasis on agility, adaptability, and resilience to thrive as the country reopens. Create a fluid organizational structure, combining the talent, capabilities, and agility of your internal employees with a network of independent consultants, suppliers, industry collaborators, customers, and associations. This includes organizational culture, competencies, performance measures, and reward systems. Leveraging your network and creating the ideal organizational design are your superpowers to get to the top efficiently and effectively.
Re-examine your business model and operations. A crisis represents a huge opportunity to rethink everything you do. Are you doing the right things right? Look for ways to increase efficiency and profitable growth. Cash is king, so how can you generate more cash? There is a huge opportunity for cost savings by re-examining, and if needed reinventing, all aspects of operations, business models and revenue models. This includes infrastructure, processes, technology and facilities. Implement a continuous improvement culture that encourages innovation and looks for and eliminates waste throughout your delivery model (defects, waiting, underutilized talent, motion, transportation, inventory, extra-processing and over production). Incorporate digital enabling tools into your transformation.
Enhance employee engagement. As you create your lean organization, you must be highly focused on caring for those employees that remain. In the new normal you will probably have more people working remotely and regular and supportive “check-ins” are key. Additionally, an Employee Engagement Survey at least twice a year will help you continuously improve the work environment, culture, and employee commitment.
Courageous Leadership: Leaders must be willing to make decisions under uncertainty, experiment with new ideas and — above all, realize the urgency of the situation and act decisively and rapidly. Leaders must be compassionate about people, especially important because as you recreate an aligned organization, you need to maximize collaboration internally and externally and inspire co-creation with everyone involved. They must trust you to follow you to the top.
Avoid being a Gumby and follow these markers to the top. This may seem daunting, but “look well to each step; and from the beginning think what may be the end” and you will ascend further than ever before. Stay positive and optimistic as we leave the abyss behind.
If you unpack and employ these action items you will be on your way. If you are looking for an experienced guide to help prepare and execute your ascent back, please contact me.
To help you move forward with clarity and confidence, I am offering a FREE one-hour one-on-one call to review your business needs. Click here to contact us, call 978-697-5065 or email brianpost@verizon.net.
I would also encourage you to make a donation to the Business Equity COVID-19 Emergency Fund.
