Few businesses have come through the long months that started with the Covid-19 shutdowns in March 2020 completely unscathed. Some have weathered the crisis, while others have crumbled. Regardless of industry, the pandemic has had devastating consequences — especially for businesses without a crisis contingency plan.
While no one can fully predict the future, there are ways to better prepare yourself and your business for a crisis situation. To that end, 12 members of Business Journals Leadership Trust share their top insights for building a crisis-resistant enterprise.
1. Plan for the worst-case scenario.
You have to follow the old adage: “Hope for the best, but plan for the worst.” Having reserves set aside helped us ride the cash flow dip when Covid-19 struck and our clients began paying later or asking for payment plans. We are more proactive than reactive, and this brings our stress level down. We see clients that don’t take the proactive approach; the stress it causes is mind-boggling, and the reactive cost is usually much higher. – Jim Lane, Lane Technology Solutions
2. Conduct a PESTLE analysis.
A PESTLE analysis should be part of every company’s strategic management framework so they can identify the external factors that could impact their business. For example, every one of the six PESTLE factors (political, economic, sociological, technological, legal and environmental) is present in a pandemic. Awareness and preparation help build a crisis-resistant enterprise. – Mark Zinman, Zinman & Company
3. Be willing to change, cut and pivot.
I have been an entrepreneur for more than a decade. My experience has taught me that you need to find ways to survive in the short run to execute bigger strategies in the long run. To survive, you must be willing to change, cut and pivot. If you don’t know what to do, ask yourself this question: “What do I need to know now to take one step forward?” The answer will get you “unstuck” and moving. – Linda Bishop, Thought Transformation
4. Use crises as an opportunity to adapt and rebuild.
Never waste a good crisis! The collective feeling of crisis can introduce new malleability in the minds of your team members. Take advantage of this flexibility to rebuild the business structure into the ideal. Likely the crisis will not be as severe as feared, but the energy placed in rallying around a new and more effective vision can be powerful! – Jason Dunn, DACS Asphalt & Concrete
5. Anticipate and prepare for what could go wrong.
I don’t think it’s possible to build an organization that’s impervious to a crisis driven by external factors. The key is anticipating what could go wrong and preparing yourself and your organization so that your success is not dependent upon the best-case scenario and you can still move forward if less-optimal events occur. Having an amazing culture is also a critical part. – Jonathan Keyser, Keyser
6. Create a brand that stands apart from current trends.
Every brand and product should have a distinctive identity that supports and improves consumers’ lives. Try not to tie your brand to highly charged, macroeconomic current sentiments. Stay true to your identity instead of just reacting to the environment. – Jessica Hawthorne-Castro, Hawthorne Advertising
7. Build a strong leadership team.
One step for building a crisis-resistant enterprise is to promote the right people to leadership roles. Leaders are responsible for guiding the ship through rough waters. During a crisis, effective leadership is essential. In short, it is crucial to have a steady hand at the helm. A leader who projects timidity or dishonesty will sow distrust in the organization. – Mark Gibbens, Erudite Capital
8. Invest in your culture.
I think having a strong team of employees is what helps companies weather any storm. This starts with having the right culture, strong leadership and open lines of communication across all levels and teams. Companies that invest in building a strong culture will see differences in performance during more challenging times. – Tom Rourick, RSM US LLP
9. Take inventory of your entire organization.
During a crisis, an organization needs to really look at its overall inventory. During the Covid-19 crisis, we took the opportunity to streamline everything for maximum efficiency. We looked at our human capital and knowledge expertise, as well as every little thing that goes in or out, with a greater understanding of what is needed. Balance your inventory, from cash to people. – Gene Yoo, Resecurity, Inc.
10. Develop productive cash flow systems.
One step for building a crisis-resistant enterprise is building a positive cash flow. Not relying on clients that are waiting to be paid by the owner before you’re paid is a positive in running a successful business. Not holding on to unnecessary resources also has a positive impact on running a business. The Covid-19 pandemic should have provided an opportunity to shed unproductive activities and resources. – Jerry Ramos, Ramos Consulting, LLC
11. Focus on your strengths, and improve or outsource the rest.
We were spending too much time on administrative accounting tasks that were not adding value to our business. We found a great accounting firm that is able to do our bookkeeping better and at a lower cost than we could do it ourselves. Don’t take on what you can’t do well. – Jared Knisley, Fizen Technology
12. Manage to your vision, mission and core values.
We hire employees, vet clients and make strategic decisions by filtering them through our vision, mission and core values. The caveat is that your “purpose” as a business should be to do good versus purely pursuing profit. Profit-seeking is often the cause of crisis for corporations. – Kent Lewis, Anvil Media, Inc.