While the ongoing pandemic has certainly thrown a spanner in the engine of many a business, some businesses have managed to get by or even flourish.
The effect of lockdown and the pandemic on businesses has varied wildly though, this is to be expected given every business is unique.
Unfortunately, we are far from out of the woods just yet and the impact of COVID-19 and the lockdown we still find ourselves in will surely have long lasting impact.
“The question for most business owners now is, how do I effectively manage my business out of this current crisis and, as importantly, ensure that it isn’t impacted in the same massive way by any future crises?,” asks head of SME development at FNB, Yolande Steyn.
“Of course, there’s no simple answer to that question because crisis management is different for every business. That said, COVID-19 has certainly reminded us that there are a few fundamentals that every strategic crisis response plan must include,” says Steyn.
One of those fundamentals is scenario-based planning.
Adopted by the US military in 1945, scenario-based planning is where one looks at data and plans for a range of possible scenarios that might occur within a business.
Of course, this sounds a bit like trying to look into a crystal ball to predict what the lottery numbers will be for a given day but in this instance you have access to data which can be used to inform decisions.
What makes scenario based planning most important however is being able to put yourself in the right frame of mind to make the hard decisions. This is important because during a crisis one might not be in the right frame of mine. Having a plan to fall back on then will help navigate turbulent times.
“Importantly, to be fully effective, such a scenario planning exercise shouldn’t only focus on external or environmental possibilities. It also needs to consider the various revenue, operational, staffing, cost-cutting and asset management scenarios that the business would need to implement, should one of the possible external situations become a reality,” says Steyn.
Generally speaking, this sort of planning is best done with a diverse set of people
“These needn’t be as extensive as your primary business plan, but they do require careful consideration, by all in management roles, of the actions or reactions that would be required under each possible scenario,” the head of SME development adds.
The good news is that this isn’t an especially complex exercise but you should be making moves to implement scenario-based planning before it’s too late.[Image – CC 0 Pixabay]