Why Planning Matters: The What If’s
Business clarity has been severely reduced for many organizations. Most owners were counting on a gradual business recovery beginning about now. As different parts of the country were given the signal to restart their business activity in the wake of the global pandemic, those same regions are now also affected by social unrests. While the strength of most businesses will see them through these issues, they should proceed with their eyes wide open.
Managing the business and making strategic decisions become nearly impossible without some level of clarity in the future of your revenue stream, even as unpredictable as that might be. The structure of their business analytics and the quality of the incoming data are key factors that owners rely on to get things right. I get a chance to see customer insights from several different companies each week and they range from extremely detailed to vague and virtually non-existent. Part of this spectrum is based on the culture of an organization, business management, expectations, tolerations, as well as the different markets that they may be in.
Why It All Matters
Decisions need to be made in regard to staffing, capital investments, financial obligations, M&A and restructuring options, and cash management. These decisions are even more important as the recovery begins and opportunities begin to unfold.
Your Market Elasticity – Will It Rebound
What information are you relying on to gauge how quickly your markets will recover? Who are you talking to, what are you reading, what and who is on your calendar? There are many economic views of whether the recovery will be a U or V shape or some variation of the two. You can assume that not all regions of the country and vertical markets will behave the same. Having some intelligence from your customers relative to their recovery model and anticipated timeframes can certainly help in your planning.
Steps You Can Take
Start building your revenue models, and try to anticipate the what if’s. Gather the relative information on your customers and on the verticals you are in and incorporate that into your probabilities. Based on the top line, what level of staff will you need? Will the anticipated revenue model be enough to cover your fixed costs? Whether you end up downsizing, maintaining, or growing, you’ll have to plan accordingly. To capture any and all good opportunities going forward, you’ll need to be as proactive as you can be; don’t be caught resting on your heels.
If you have questions or insight into this topic, please comment below or reach out to me directly.
Mike Philie can help validate what’s working and what may need to change in your business. Changing the trajectory of a business is difficult to do while simultaneously operating the core competencies. Mike provides strategy and insight to owners and CEOs in the Graphic Communications Industry by providing direct and realistic advice, not being afraid to voice the unpopular opinion and helping leaders navigate change through a common sense and practical approach. Learn more at philiegroup.com, LinkedIn or email at email@example.com.