Recently, a few companies have asked me to help them navigate this tumultuous time for entrepreneurs. Candidly, no one understands the challenges of keeping a company afloat but a business owner who has skin in the game. Of course, that’s not to say that other people have zero input in keeping a business afloat. But entrepreneurs are typically the only ones who sweat every detail in the moment, such as in this current business environment. And what this has reinforced for me is how crucial business continuity planning is for any entrepreneur.
The Questions That Matter In Challenging Business Climates
I am unpacking the fact that there is a new normal evolving — every day — with other business owners. First, I’m not convinced that soon business will be like it was in prior months or even like the year before the novel coronavirus pandemic. Therefore, the messaging for marketing should be to reframe a company’s strategy to focus on the mentality of survival, caring for the consumer and creating business resilience.
For business continuity planning, operational resilience is also essential. I’m focusing on it within my brands and even as I consult. Operational resilience boils down to location and team resilience. It means asking what and who on the team is essential. And how can a business owner keep teams productive, with continuous measurements in place? Financial resilience is critical for working through the dynamics of engaging suppliers, credit and cash reserves. In moments like these, entrepreneurs should understand their cash flow plan fully, the amount of fuel in the tank and when the business could run low on money.
Further, what I’m also focusing on is cost resilience, which is also critical in business continuity planning. It starts with the question: What can you prune down? Can you downsize to a smaller space? What external services should you review and adjust? Of course, payroll cuts are tough but often necessary to keep costs in line with the new normal. In other words, to keep a company afloat, everyone — including workers — has to make sacrifices.
Finally, revenue resilience comes from sharpening the focus on being customer-centric. Entrepreneurs need customers to be healthy and engaged. Now is the time to stay close to your clients. In the process, you should pay attention to risk reversal because closing the sale before the current climate was different than doing it in the ever-evolving new normal. That means strategic consultation-based sales are the key — without an ask.
What Is Business Continuity Planning?
Business continuity planning (BCP) is a must-do, especially at present. It is an opportunity to manage strategic resilience and understand how to become a mile deep and an inch wide — versus the opposite. Business continuity planning is a process whereby leaders develop systems to prevent and recover from threats that exist. In other words, this is risk management in the middle of a changing and fluid environment.
Business continuity planning includes having a plan for all threats, which can range from economic to cyber-security threats. None of us know what the future holds, but as business development leaders explained in a recent article, planning is vital and essential for any successful business. Trust me: Knowing that we’re executing our BCP strategy eases the pressure, and that’s what every entrepreneur needs to be doing now. If they don’t have a BCP, they need to develop one as crises like the pandemic unfold.
Steps To Plan For Business Continuity
Once you complete it, you should evaluate your business continuity plan several times during the fiscal year of the company. As we know, the business environment shifts very fast in today’s world, and it’s vital to develop a plan, but also make sure it’s not outdated — especially as it relates to finance, technology and sales, for example.
• Assessment Of Risk And Impact Analysis
During this initial phase, you want to understand all the exposure risks for your company. This means you have to think of every possible kind of risk for your business. By doing a business impact analysis (BIA), you can gain clarity about every potential threat to your business.
The BIA will provide you with critical information, such as who your stakeholders are, your supply chain gaps, and your levels of resilience. It will also inform you about the core team that you should keep in place in the face of potential catastrophe.
• Business Continuity Plan Development
Once the team that is working with you on the creation of the business continuity plan has the information from the BIA and any gap analyses, it’s time to get started on the creation of the BCP. Initially, the team should create a draft document, and then they can present it to the senior executives who have to sign off on it.
The business continuity plan is essentially the answer to questions about how your business can continue with operations should there be any crisis or disaster. This plan should encompass every area of your business from the macro to the micro levels. Consideration and review should move through the entire company, including every division and into each department, role and function.
• Testing And Maintenance Of The BCP
As I mentioned earlier in this article, and as one CIO article explained, you should review and evaluate the business continuation plan regularly — and even more so now. For finance, operations, marketing and sales, my team and I continually work to understand what our minimum metrics must be for our businesses to continue.
I can’t emphasize this enough — preparation is critical, and at moments like the present, planning is happening daily. Ultimately, it’s all about coming out on top. Building relationships, having strategic discussions and developing clear messaging are key. It’s also important to reframe and refocus your operations, marketing and sales strategy to fuel your revenue generation and cash flow during difficult times. For more information about business continuity planning, you can visit the Small Business Administration website or even SCORE’s small business disaster preparedness resources.
By Wayne Elsey