As important is how we respond to a rapidly changing world where some experts are predicting that two thirds of the top 500 U.S. companies will be out of business in twenty years.
Address these 6 action plan items now
Long term strategy
It is vital that you have a sound long-term strategy in place. If you don’t know what you are aiming for, it is going to be extremely difficult to make successful adjustments.
Be outward looking
Keep close contact with customers and suppliers. Know what your competitors are doing and keep track of overseas trends. The sooner you know of potential threats, the better placed you are to react.
Align risk strategy
In disruptive times, risks increase. A fundamental risk all businesses face is reputational risk – see below under communications. In addition, needing to respond quickly to events inevitably involves heightened risk. Ensure you have appropriate risk parameters – for example, set management incentives based on your appetite for risk.
This is two-fold:
- Internal communications need to be in place to provide for effective communication down to your staff and from your staff to you. In many instances, staff will pick up potential changes in the business environment and need to communicate this upwards. In turn, you will need a speedy and appropriate response for the business to implement.
- External communications to shareholders, customers and other important stakeholders are important to get their trust and buy-in to any strategic changes you need to make.
A Social Media strategy is also significant. Reputations can be shredded by Social Media – being able to scan this media and respond quickly could help save your business.
It will be difficult to swiftly change strategy without an empowered staff. They need to be confident and motivated so they can communicate effectively and execute any changes to strategy. Key staff positions should be filled with people who have the talent to innovate.
The business needs to be flexible and agile in its business processes so that changes to strategy can be rapidly rolled out.
2016 and future years are going to be demanding. Make sure your business is equipped to handle this environment. Speak to your external accountant who will be seeing many organisations and will almost certainly be able to help you.
This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE).