Updating Your Business Strategy For a New Reality

The last several years have been filled with challenges, especially for businesses. Business owners wonder if the problems or issues that they see will continue to be the case, or if things will settle down and go back to the way it was before. The thing is, when major components of the way business operate change so dramatically, it is difficult to have things go back to the way they were and sometimes, it isn’t always better.

It is apparent that the businesses that have thrived over the Covid shutdowns, as well as inflation and a possible recession (as some economists suggest that the economy is in) are the ones that accept the “new reality” and embrace the changes, looking for opportunities along the way. The businesses have changed and adapted their strategic plans to that reality, so they can still grow in this tumultuous environment.

Here are some of the major items that businesses have had to change or acknowledge are issues:

1. Supply Chain Issues – Looking back about five years or so, businesses had ample supplies. Many companies had sourced supply from China and had built in the lag time in their strategic plan that would be present in sourcing supplies from China. After covid, lockdowns in China, shipping issues from China to the U.S., it has become apparent that companies needed alternate sourcing. Some companies have set up relationships in other Asian countries, some in Latin America, Mexico. Many businesses are now looking for opportunities to set up sourcing in the U.S., using strategic alliances with other U.S. companies to use underperforming factories to source their supplies. This has been a major shift for small to mid-sized companies. Those that create these new relationships to open up supply to their businesses are the winners and will thrive as companies, despite the potential recession.

2. Customer Interaction – Businesses have adjusted their interaction with their customers to make it more of a win-win scenario. The businesses that thrive understand more about the customer than just what components they buy, how often and at what price. They find what is really valuable to their customer and become a real resource for them. For instance, if the customer is short of some material or parts that the business does not sell to them, the business takes the time to find a company who can provide it to them, and perhaps, sets up a strategic alliance with that company to provide the supply to this and other customers who are in a like situation.

3. Cash is King – The successful businesses must be cash-centric. This means shorter wait times or prepayment of purchases by their customers and managing their payables better. It also means looking at their company’s line of credit more carefully and comparing what other potential lenders can do, keeping a larger line than may be necessary to maintain a liquid enterprise, despite a potential recessionary period of time. The business may simply have outgrown its current lender and cannot provide the servicing that the business needs.

4. Remote Workers. In the manufacturing setting, a lot of workers who may have worked offsite have come back to the company’s location. This is not the case for service other types of businesses. When employees are used to working on their computers at home and joining team meetings online, it becomes difficult to totally remove that type of flexibility from the workers. The successful companies are revising their work schedules, so some days employees are on site and sometimes they work from home. Sometimes working from home is an incentive, once the worker shows that they know their job and can stick to the goals set for them. Companies acknowledge that remote working is not for every employee. Some businesses find it difficult to properly train employees or build a strong culture. Yet, many companies have found ways to build solid cultures with happier workforces through more flexibility and have increased productivity. However, if layoffs in some companies come to pass, the imbalance in the number of available workers may change and remote working will be less prevalent. Having a strategy and structure that can ebb and flow with the current situation is imperative.

5. Cyber Issues – Cyber issues have multiplied during this time frame. This includes phishing, but also more sophisticated ransomware attacks. Since there have been a lot of employees who have been working remotely, it is necessary to make sure that they are taught what to look for, what not to click on, and that the company technology is up to date on cyber protections. The successful businesses have managed that through their IT teams, have brought in the expertise to train their people, and have the proper cyber insurance to protect the businesses from these problems.

These are but a few of the issues that have faced businesses in the last several years. The best and most successful companies are those who can pivot their strategies to accommodate the changes that have occurred. Along with that, great companies have a great team to think through the obstacles and find the opportunities that allow their companies to thrive. Make sure you are reviewing your business plan to address all the latest issues that may hinder your success. Bring in the right people to advise you internally and externally. Be willing to change for the better and accept that with change you will see more success in reaching your goals and keeping your business healthy and prospering.

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Denice Gierach

Gierach Law Firm

Denice Gierach is an attorney, CPA, Northwestern University business master's graduate, and has owned several businesses from real estate to manufacturing. She is the lead attorney at Gierach Law Firm in the Chicago area. With more than 30 years of experience, she has been a respected and sought-after resource for businesses looking to grow, sell, solve problems, and succeed long term. Her insights across business areas gives a fuller lens to business issues and solutions, and helps businesses grow and succeed with less time spent on legal issues and other time-consuming problems.

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