Over the last 5-weeks or so I have been blogging about a range of challenges facing many small to medium businesses, as well as touching on what they can do about it. How they can plan a strategy to overcome it.
I have also had contact from some businesses asking for assistance and that is very much why I have completed this series, to bring awareness, and get Businesses thinking about some of the challenges and what they can do about it. So, I still have capacity to help many others with these challenges and we can set up some time to focus on you and your business so please get in touch.
This is the final week of the series, and I am going to look at how we Scan and Plan to Break Free, often I ask Businesses what they will do differently in the new year or what are their plans to get moving quickly after the Holidays. In the majority of cases, it is just a business-as-usual approach which is ok, but you must take the opportunity to scan the next year. Looking for the big challenges and then planning the next 90 days. Scanning and planning are two key actions we should always be doing.
Scanning
This for me is simply looking at the macro and microenvironments and considering how they will impact the business. Understanding what changes we will need to make to ensure we manage those impacts and also achieve the goals we have set out.
The challenges and headwinds coming into play in 2022 are already here and started to rear their ugly heads through 2021 and we need to be ready to tackle them. Are you ready to tackle them? After all what looks like a challenge is not always and could be an opportunity.
The key headwinds as I see them are
- Supply chain
- Inflation
- Interest rates
- Recruitment
- Working practices
Supply Chain – The massive impact of the supply chain issues really hit the headlines in the second half of the year, albeit there had been issues for quite a while before. Some challenges linked to Brexit, some to Covid and some to both have made it difficult to get goods to the desired place, in the required quantity at the right times. The goods themselves, manufacturing, shipping, transport and even driver numbers along with port and import concerns playing a big part. This has obviously impacted business’s ability to trade, manage cash flow and even at times cause credibility concerns.
Inflation – With the supply chain issues and increasing costs associated with manufacture and transport we will know doubt see the impact hitting retail prices as the economy starts to pick up and demand grows. This may well lead to inflation and the government has indicated we may see inflation up to 5% in 2022. For some, this will have a working capital impact as resources are squeezed. Some of it could be offset with good planning and execution to ensure adequate resources therefore making inflation less impactful for that specific process and temporary for the industry as a whole. So, working with trade bodies and being as much a part of finding the solutions could be especially important. I would say that with limited labour in many areas we may well see inflation in some areas that appears abnormal, like the labour markets, with increased salaries and at some points potentially reduced capability and outputs, again impacting cash flow and perhaps even forcing business to look at their organisational set up as well as pricing models to mitigate the downside.
Interest Rates – There is already a lot of debt within business coming from the various loan schemes the Governments have put in place worldwide. This will be added to as business really get a foothold back into their markets as working capital may be needed. Along with the need for upgraded equipment and technology that may have been postponed over Covid. With many variants of Covid coming forth, the stop start impact on businesses means borrowing may be more of a necessity than normal. We know that government often use Interest Rates to manage Inflation, so the chances of increased Interest rates are very possible. Accessing capital, and planning how you can do that more efficiently now may be key to ensuring some kind of success when through these variants of Covid.
Recruitment – I mentioned earlier about the issues around Transport as an example of the impacts we have seen so far, and this is an area that will have a big play in the 2022 success rates. Whether for your business directly or for contractors it could be a headache. Increasing salaries, more training, higher absences are all areas where you need to plan forward for and manage now to lessen any future impact.
Working practices – obviously, we have all heard about the drive for more people to work from home and whilst this is coming from the heroic efforts during Covid it is sticking, and that can be tough to manage. Thinking about how your business will manage this is key. Some staff members obviously cannot work from home, some can, and others may be able to do both depending on their role and/or circumstances. I challenge people to think more broadly than this though as even before Covid we had generationally different views on what they would like to do. For some they get that there may be no overtime, but could they still work their standard hours when they want to within the working week? Ultra-flexible approaches like this could be the difference between high morale and improved productivity or low morale and increasing absence and turnover of staff. Again, an area that needs planning. Final thoughts on working practices could be down to simple changes to how you work, what programmes fit best – as an example would Agile improve how you deliver your product or service?
In highlighting some areas like the above I am not presuming that is all of them, we have several other ones like Climate and Technology, and I am sure more relevant ones geographically or sectoral.
Planning
The opportunities can be maximised by breaking free. The next step, once we consider the above, is to start planning. I tend to consider, given the world we are in right now, that a medium-term view of 12 months is still quite a complicated process to commit to, however we must. It is vital to consider what we think the next 12 months will look like, set our goals accordingly and then plan how we will achieve them.
Depending on the size of your business and the goals you have set down you may have slightly different approaches. I would normally look at what you do, where you need to invest and with whom you will work. If you have ambitions to diversify then allocating funding across all products or services, plus considering the new marketplace is key. Resources will be stretched so looking horizontally across your business and vertically within your business is necessary in terms of planning, goal creation and resource management.
I always consider thinking in 90-day incremental plans, one after the other that build on each other allowing for changes in direction or tweaks in management actions.
So, Scanning and Planning, for me, are vital and processes that I am keen to support businesses on. Thinking big picture, focussing up to medium term and planning to mitigate and move forward, are all must dos for your new year resolution or indeed just ongoing. Getting into the habitual process of planning will and can boost your business. So, get in touch and let us talk about how I can help you.
STORM 7 COACHING 