5 strategies I advise my clients to adopt as they start the new year
As we start the new year, many business leaders will be pondering over the challenges they will face in 2021. A year ago not many people would have predicted the devastating effect of COVID 19 on human lives and the economy. Without a vaccine, 2021 would have been gloomy to say the least. Economists are now forecasting a recovery by the end of 2021. Though there are still uncertainties linked to mutations of the virus and the efficacy of the vaccines, we still need to look ahead. We cannot change the cards that we have been dealt but we can change how we play the hand.
2020 was a very challenging year for many businesses. Just like in good years some businesses fold and go bankrupt despite a booming economy, so it is in bad years. Some businesses thrive and do very well despite the economy being in shambles. Last year, I was exposed to both types, those that have done exceptionally well and even thrived, and those that have not managed to make it and sadly, have had to close down.
Here are some strategies to adopt in 2021 to mitigate the impact of the economic situation and weather the storm until the sun shines again. In fact, these are strategies to adopt in all economic situations, good or bad. They are the basic requirement for sustainability of a business. Yet, it is surprising to see how many businesses fail to put these in practice.
- Remember Aesop's fable about the Ant and the Grasshopper? Create a Plan!
The fable goes something like this. "An Ant was spending a fine winter’s day drying grain collected in the summertime. A Grasshopper, dying from hunger, passed by and earnestly begged for a little food.
The Ant asked him, “Why did you not store up food during the summer?”
He replied, “I didn’t have enough time. I passed the days in singing.”
And the Ant retorted: “If you were foolish enough to sing all the summer, you must dance supperless to bed in the winter.”
Moral: Plan ahead or don’t be surprised when things don’t work out."
Many believe that a plan is only required when one starts a business or when one applies for a loan. A plan is actually a necessity if you want to ensure that you reach your destination. If you were to start a ten hour journey, you would most likely devise a plan addressing issues like which route you would like to take, where you would stop for refueling and eating, where you are likely to be delayed or get stuck in traffic and what you would do to avoid these challenges, who you could bring along with you to make the ride enjoyable, what resources you would need etc. Many of us would even prepare a small checklist the day before if not much earlier. A ten hour journey requires a minimum level of planning. Now imagine what an 8000 hour journey would require (Yes, there are more than 8000 hours in a year)!
Your plan does not have to be a twenty page document. It could just as easily be a one or two pager. As the wise saying goes "Failing to plan is Planning to fail". As a minimum you would need to have the objectives you are setting for your business, the challenges that you could face, the resources that you would need and the actions that you would take for each of your objectives. This would provide you with an opportunity to reflect on the journey you have ahead and on how you would know when you reach your destination.
Many businesses think that they will do just fine by winging it. After all, their logic goes, this is how they got to where they are. They however do not realise that had they been better at planning they could have gotten faster or easier to where they are.
"Give me six hours to chop down a tree and I will spend the first four sharpening the axe" - Abraham Lincoln
2. Communicate the plan and get buy-in. Ninety percent of plans fail at the execution level.
No one has ever achieved anything worthy singlehandedly. If one cares to look closely enough or dig a little, one will always find that there are at least one more person who has helped along the way, be it a parent, a spouse, a relative, a teacher, a sibling, disciples, a team, employees or an army.
To ensure success of your plan, share it with your team and all those upon whom you will rely to make it a success. You will need to clarify what the plan means and what is expected of each team member. Due to diversity, the same word could mean different things to different people. For example, a simple word “apple” could conjure different images for different people. Some might be thinking of a green one, others a red juicy one and yet others might be thinking of the technology company or their IMac or IPhone. Once I even had someone thinking of apple cider vinegar when I tried this exercise with the top team at one of my clients!
Successful leaders have realized that growth is not a project with start and finish lines. There are no quick fixes. They therefore need to be relentless in pursuing their vision and executing the plan. Together with disciplined execution they will need to hold their team accountable. This starts with ensuring that everyone knows what is expected, buys into the plan and commit to it. So communicating the plan is crucial to its success.
3. Invest in your people. No, REALLY!
I recently ran a survey about business strategies. Whilst the responses showed an overwhelming awareness of the high impact investment in people will have on an organisation, the situation on the ground seems to be in marked contradiction to this. All too often businesses see the resources they spend on their human capital as "expenditure" instead of as "investment". This could be as a result of them not seeing an actual figure on their balance sheet whilst they do see a figure for their investment in stock, equipment and technology etc. Could it also be because expenditures on human capital are generally allowed as immediate write offs against revenue whilst those on assets are capitalised and written off gradually? I wonder.
The fact remains that the biggest bang for your buck will be generated from your investment in your people. At the end of the day, without the people you will not be able to sweat your assets, usage of your equipment will not be optimised, your technological investment may not be properly deployed, implemented and operated whilst the investment you would have made in marketing would have gone to waste if the employees do not deliver on the brand promise and customer experience your marketing communications have promised.
The investment in human capital does not have to be solely on salaries. It could take the form of training, development, working conditions, tools and equipment and so on.
Most experts agree that investment in human capital development increase productivity and competitiveness for the organisation. Reports from international organisations like the World Bank, the OECD, International Labour Organisation as well from academic research supporting this view abound. You would gain a lot by revisiting the practices within your organisation and by placing emphasis during 2021 and beyond by developing and IMPLEMENTING a proper Human Capital Development Plan.
CFO: "What if we invest in our people and they leave?"
CEO: "What if we don't and they stay?"
4. Invest in Marketing
The first item that companies tend to cut down during difficult times is the expenditure on Marketing. This is exactly the contrary of what ought to be done during tough times.
Generally it is accountants, considered to be "left brainers", that are normally in the driving seat when it comes to cost rationalisation initiatives. No wonder many of them have difficulties understanding the creative right brainers normally found in the marketing function. This result in the proverbial fight between left and right brainers. As the hatchet normally is in the CFO's hand, guess who normally wins.
Marketing, if done correctly, will increase your visibility, brand awareness, bring in customers and drive revenue. Find yourself a good agency, get to work with them and reap the rewards.
Marketing does not have to be costly. Digital Marketing has proven to be effective and cheaper than traditional marketing. You should definitely have a marketing plan that comprises both. The weightage will depend on the size of your budget.
5 Seek help.
There are various reasons and ways of getting help. This may be in the form of reading a book or creating a mastermind team or hiring a consultant or finding a coach or a mentor. Very often, one does not possess the knowledge, resource or expertise required (though too many entrepreneurs and leaders think otherwise). At times, we are too close to the problems and the solutions, though staring at us directly in the face, are not clearly visible to us. At other times, we lack the objectivity required to take tough decisions. These are often the times when an external resource goes a long way. Don't be afraid to seek the assistance of others to help you reach your objectives. Putting your ego aside and getting the right support can make the difference between success and failure.
Small wins pave the way for bigger ones. Do not sit idle. Apply the knowledge that you have by accomplishing a little more everyday. No need to reach perfection. Keep moving one step at a time. As Gandhi said, "A thousand miles journey starts with a single step."
“Any action is often better than no action, .... If it is a mistake, at least you learn something, in which case it's no longer a mistake. If you remain stuck, you learn nothing.” Eckhart Tolle, The Power of Now: A Guide to Spiritual Enlightenment
Swadeck Taher OSK is a Chartered Accountant and Chartered Marketer running businesses and coaching/consulting/mentoring CEOs and entrepreneurs ranging from startups through family businesses to established top 100 companies in Mauritius. He is enjoying putting the expertise he developed over the last thirty years at senior leadership/directorship level at the disposal of his clients, business partners and other budding entrepreneurs.
Swadeck is also a GTD Practitioner and a Certified GTD Trainer. He helps others experience what the Productive Experience feels like and how they too can savour stress free productivity.
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