AlbuonStrategy – May 2020 Newsletter

Website Link: https://albu-strategymanagement.com/2020/05/short-term-long-term-strategic-choices/

Short-Term/Long-Term Strategic Choices

From our vantage point, we cannot honestly say that anyone has all the answers at this moment in time.  Uncertainty about the future continues, and crisis management in the near term is consuming everyone’s attention.  According to a survey by Alera Group, titled Covid-19 Employer Pulse Survey, “over 80% of respondents across all sizes, regions and industries feel that Covid-19 will have a negative impact on their business in the next 12 months…and the biggest impact will be uncertainty and loss of revenue.”

What to do?  Are we on a path to recovery? Are we making the right choices?  When will this crisis be behind us?  As we speak with our current and past clients and a host of very smart network of advisors, we are hearing how business owners are weathering the storm, and some better than others. 

As we shared with you in past newsletters  there are a number of steps to consider to deal with the pressing needs of the business (Five Steps to Manage a Downturn).  We are confident that you are already implementing many of these steps to resolve immediate challenges.  As businesses move from crisis mode to preparing for the “new normal”, here are some strategic decisions to consider right now to help your business be better positioned for life beyond the pandemic. 

·         Lead with your core business – Leverage your core capabilities which will strengthen your competitive advantages now and into the future. 

·         Take complexity out of the business – This is an excellent opportunity to eliminate non-profitable sacred cows including products, services, clients, and geographies.

·         Seek greater business resilience – What changes should you start making now to areas such as supply chain and customer facing activities to improve your economic sustainability?  These moves will ensure you can quickly recover from this and future setbacks.

As you look to the future, or what might be called “looking over the wall” to the other side of the pandemic, how would you reimagine the future of your business?  How will your industry, customers, competitors, vendors change?  These are important questions that need to be discussed now.  We recommend creating a small team of senior managers to focus on defining the challenges and opportunities 2- to 3-years out.  Consider using multiple scenarios of the future state, which will help your business become more agile.  It will provide you with a broader view of the external landscape and the possibilities for success. This future state committee can address questions like:

·         What is the future of our industry? 

·         How will our supply chain change? 

·         How will the competitive landscape be altered? 

·         How will we deliver exceptional customer experience? 

·         What are our new market opportunities?

A key responsibility of the future state committee is maintaining a deep understanding of multiple scenarios and offer strategies to mitigate risk and identify the triggers to initiate action on a strategic choice.  For more on long-term strategic planning, check out one of our recent article Strategic Thinking for a Post-Pandemic Era.

We have all been working through the Covid-19 pandemic for over two months now.  Leadership teams have been in crisis mode to survive.  Now is the time to begin to work on the next phase of planning to identify both short- and long-term strategic choices that will help you come out of this crisis stronger.  We would welcome an opportunity to discuss these and other ideas with you to help you thrive in the post-Covid era. Please share this blog with others as you see fit.

QUOTE

“The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday’s logic.”

Peter Drucker

Dick Albu is the founder and president of Albu consulting LLC, a strategy management consulting firm focused on engaging and energizing leadership teams of middle market private and family businesses. With offices in Stamford, CT, the firm is dedicated to helping its clients formulate robust business strategies and follow through on execution of key strategic initiatives. Dick Albu can be reached at 203-321-2147 or RAlbu@albuconsulting.com. Rob Krist, Managing Director can be reached at RKrist@albuconsulting.com.  Please visit Albu Consulting’s website for more information at www.albuconsulting.com.