Are you ready for the challenges of 2021?
The business landscape was tipped on its head in 2020, it’s time to hit the reset button and ask yourself, “Are you ready for the challenges of 2021?
Making sure that you have the fundamentals of your business right will help you prepare and allow you to be proactive rather than reactive when the effects begin to be felt; and most importantly, allow you to be in a position to take advantage of the opportunities that 2021 will provide. When you are looking at fine-tuning your business for 2021, there are three steps to help guide you:
- Get Perspective: How has your business been impacted? What have you done in response? What systems have you put in place? What have you set up already to be prepared for 2021?
- Get Prepared: What is going to be required next year? How might you be able to do things better in 2021?
- Take Action - engage the support and help you need.
Getting Perspective on the Fundamentals
What cost base can your business sustain? Don’t wait until the end of the financial year to find out what the reality of your numbers are. Review the short, medium, and long-term trends and consider whether these are likely to hold up. There’s a false sense of security, even in the media, that economic activity has bounced back. It has bounced back some, but it’s still worse than it was before. Compare how the trends are tracking now compared to where they were last year. If this spike of activity is temporary, does your cashflow hold up? And if it doesn't, then what is sustainable from an expenditure perspective? If your business has changed, do you have the right skills to operate effectively? For businesses in the middle of migrating to more online services, there is often a realignment of skill sets required to remove duplication. The urgency around fixing things that you may have just let lie for a while will start to ramp up in 2021. Of course, a lot of it will come down to what's affordable given your cost base. What about your customers? If you haven’t already, take a look at how your customers and suppliers are doing. Look up and down the supply chain and ask, “What sort of condition are my customers or suppliers likely to be in? Are they likely to be more stressed or less stressed than I am going through this? What are the implications of that?
Getting Prepared
Do you need to be doing things a little bit differently? In the new year, a lot of organisations will be going through the process of getting advice to see if their current structure is sustainable or looking at how they can tweak it. Are there opportunities for you to expand and if there is, how do you go about buying a business and integrating that into your network of companies? So there will be upside opportunities for some businesses and for others, it's going to be if I have to exit, how do I do that, or what can I do to avoid having to exit. There are always winners and losers. It's not necessarily going to be carnage everywhere, but you do need to be ready. For some businesses, it might mean they need to make radical changes, and for others, it will just be minor changes. Be proactive, not reactive If you start acting now and getting ready for what is coming, you can gain more control. It gives you the ability to make proactive decisions while you've still got options available to yourself. One of the areas you want to be proactive is your people. If you're going to need to hire talent because you're reshaping your business, the sooner you do it, the better as well. It doesn't matter what's going on in the economy, there's always a battle for the really good people.
Taking Action
Don’t put off thinking about it, don't delay taking action any further. If you have or will be affected by any of these challenges, the sooner you engage and talk to people about it the better. The longer you keep your head in the sand, the worse it’s going to get. Think about doing something about it rather than just waiting to see what happens. What support or help do you need to make sure that your business is fine-tuned, or well-tuned, for what's going to happen in 2021?
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