24th July 2020
By Sharmini Woodings, Managing Partner
We already knew that businesses needed to think differently and to behave differently as we entered the next decade. Agility had firmly taken its place on the boardroom agenda, even prior to the Covid-19 crisis which came as a huge side-swipe. This global pandemic – a ‘black swan event’ – is still unfolding and whose ultimate impact remains unknown.
So yes, time to think differently and for everyone to take a fundamental look at their business model. Also, the type of business that needs to emerge from this uncertainty. Time to learn from current events starting with examining the emerging themes as we all wrestle with the “new norm”.
Technology has been our saving grace. It is at the heart of all our businesses and now even more so. Covid-19 has forced all businesses, regardless of industry and size, to embrace remote working wherever possible; something unthinkable only six months ago.
We are seeing our colleagues who had previously resisted the use of capabilities like video conferencing becoming converts. People are valuing the time they save by not travelling or commuting. Homes have fast become somewhere to work as well as to live.
Given the ability to work from home at scale has aided many businesses, take a closer look at what has worked and what hasn’t. Question whether or not you have the right technology and the right level of IT support and expertise in place?
Part of our recovery will be building our business around these established technologies and new working habits, shoring up any weaknesses. Cyber security should be at the top of the list. This is because the number of criminal attacks continues to rise through exploitation of our new working arrangements.
Make sure your management information is up-to-date and readily accessible, regardless of location. Financial information, product information, and customer information all need to be at your finger-tips. This critical data all needs to be current, accurate and maintained securely in accordance with data protection legislation.
It is critical that your financial information is as precise as it can be. It will give you a realistic picture of your short- and long- term cash needs. The Government acted swiftly. With the onset of lockdown it launched a series of financial grants and schemes aimed at keeping business afloat. Those businesses, with the necessary management information to hand, were the ones to benefit the most quickly.
Reaching out and keeping in touch with customers and suppliers is also proving to be key. Again it was the strength of businesses’ data and communication technology which determined how successfully they could do this. Silence, a communication void, is not an option if you want to stay connected and in the front of people’s minds.
The continued need for physical offices ranks highly in the list of topics of conversation. As offices begin to re-open they may require significant reconfiguring to conform with social distancing requirements. Inevitably, we will increasingly look to technology to support our day-to-day working requirements. This may mean that the trip to the office or to see a customer or supplier becomes significantly less frequent.
This will lead to questions about how much space a business needs as well as the location of the office. Explore what your needs might be while taking into consideration social distancing requirements.
How have your customers fared? Poll their views and their experiences. Understand how they will inevitably change their business models and operations. How can you work with them to ensure both sides emerge from this experience positively?
The risks of onboarding new suppliers – and even over dependence on existing suppliers – must be explored. Is that new customer viable and in good standing?
Aim to understand how their behaviour may have or may still be changing as a result of the crisis. Factor this into the business relationship that you have with them. In particular consider whether buying patterns have altered. What are the new pressure points? How can you help? Do your services or products themselves need to change?
Whether it’s your staff, your customers or your suppliers, consider how you will maintain your interaction and engagement with them. This is particularly important as the way that we work has experienced a sudden and long-lasting change. For staff, consider what an effective remote working policy might be, while at the same time respecting data privacy legislation. Consider your staff’s skillset. What is their ability to cover one another’s roles and provide support in the case of illness and absence?
Review your contracts and ensure clauses such as Force Majeure or a pandemic reflect and support your commercial approach.
Covid-19 has been one of the most sudden and hard-hitting events of recent times. It’s time to see things differently and to learn valuable business lessons from it. The Wise & Co team are here and ready to support you, whether it’s for technical or practical advice or to act as your sounding board. Get in touch and share your experiences. Together we’ll learn and emerge stronger.
Sharmini is Wise & Co’s managing partner. She joined the firm in 1989 and became a tax partner in 1997. Sharmini specialises in providing owner managed businesses with strategic consultancy and tax advice. She is a first class communicator, which is essential to delivering the high quality service that Wise & Co prides itself on.