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June 1, 2020

The urgency of setting financial business priorities

The urgency of setting financial business priorities

The difficult economic environment as a result of the COVID-19 outbreak is exceptional by any standard, and it comes with extreme scope and levels of uncertainty. Management teams and entrepreneurs are having to do scenario planning and then often re-planning on a continuous basis. This while keeping the well-being of their people and their organisations front of mind, and rightly so.

In the midst of all the uncertainty that surrounds the current position, and with experts predicting a cure or vaccine to take between 18 to 24 months to be distributed internationally, it is of paramount importance that organisations set clear priorities and principles to guide their actions in this period.

Here are five actions you can take as business leader to safeguard your business resilience, in order to withstand what lies ahead:

  1. Review your why, how and what

Simon Sinek coined the phrase: “start with the why”. His TED talk on the subject has been widely quoted. Make sure to remind yourself why your organisation exists.

Whether you refer to books such as Built to Last by Jim Collins and Jerry Porras, or to studies such as the neurological levels of change, identifying the values you want your company to be known for will have a lasting effect on behaviour in your organisation – the “how”.

As far as the “what” is concerned, make sure you identify and focus on your core business. Trying to be everything to everyone is a recipe for failure.

  1. Review workforce locations, travel and leave conditions

Navigating the regulations and health recommendations will be key to continue with business operations.

Clear policies and direction need to be in place to regulate items such as:

  1. remote working arrangements;
  2. policies for working parents where no childcare is available or where homeschooling is required;
  3. absence from work due to sickness, or caring for relatives; and
  4. protocol around workers returning to the office, including adherence to health guidance.

Be prepared to continuously refresh and update these policies as circumstances evolve, and keep your workforce informed and updated.

  1. Identify potential points of failure

Who are the teams and individuals on whom critical processes or services depend, and do you have substitutes to step into these roles if and when required? We have already seen that infections at food retailers, banks and police stations have resulted in shutdowns. How can you restructure your workforce to ensure that your business can continue to function – whether that means shadow workers, staggered shifts or remote working?

  1. Perform financial scenario analysis

With the impact to organisations expected to continue for an extended period and with uncertainty rife, scenario planning is critical to ensure businesses can cope with best-case and worst-case scenarios. During this process, make sure you identify, monitor and manage critical sensitivities unique to your organisation.

  1. Don’t lose sight of other risks

In the presence of a threat as potentially overwhelming as COVID-19, it is possible that organisations can be left vulnerable to other business risks. Risks that your business has faced to date prior to the pandemic, have not diminished. Remember that with digital transformation rapidly accelerating over the last few months, cybersecurity needs to be top of mind.

Just as your organisation needs to monitor your in-house vulnerabilities,  it will also be important to monitor the effect of the pandemic on your customers, suppliers and partners.

We are all in this together. There are a lot of variables affecting the future at the moment, and at the same time, there is an overwhelming degree of uncertainty attached to each one of these variables[i].

The agility of business leaders and their decision making will be tested in the months to follow.

Take comfort in the fact that “Any action is better than no action.” – Eckhard Tolle

[i] Direct quote from https://cherryflava.com/why-your-business-should-be-doing-scenario-planning-right-now/