strategic planning for business during covid 19

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Strategic Planning in a Crisis

July 01, 2021

By: Keith Suchodolski

Technology has yet to provide us with a functional crystal ball, so no one can actually see the future. But for those of us who hold financial leadership roles, it’s imperative to consistently make the most educated guesses possible and to be correct much more often than not. This is never more critical than during a large-scale crisis.

As the COVID-19 pandemic that first swept the globe in 2020 has taught us, an organization’s capacity for planning strategically, and adjusting as needed to changes in the external landscape, can mean the difference between prosperity and failure. Effective strategic planning is essential to every organization, regardless of industry, and whether or not it’s charged with turning a profit.

Analyzing current conditions and then assessing what those conditions mean for the future is of particular importance to those of us in the strategic finance function. Given the need for financial managers to always operate with a forward-looking strategy in mind—and that the need is even more urgent in times of crisis—let’s consider how best to make plans when even the near-term future seems uncertain or threatening.

WHERE TO START

In this scenario, organizations should focus on asking a series of initial, essential questions. Exactly what type of crisis are we facing? Will circumstances continue to worsen, or are we already on the upswing? When will there be a recovery, and what type of recovery will it be?

Then, after getting a handle on these basics, it’s necessary to focus on the financial particulars unique to the current environment. What do we project for the economic and interest-rate environment? Will there be any form of government relief or stimulus to help soften the blow? How do we expect other companies—either like or unlike our own—to weather the storm?

When it comes to planning strategically, during a crisis or otherwise, organizations focused on sustainable growth are typically quite adept. The reason for this is simple: You don’t keep expanding without having carefully charted a course that you regularly review and, as needed, reassess.

Any strategic plan needs to include a few essentials, with an emphasis on the evaluation of strengths, weaknesses, opportunities, and threats (SWOT). The tried-and-true SWOT analysis, appropriately customized to address the specific circumstances at hand, may seem like a simple undertaking, but even the savviest of business leaders can struggle to identify—or perhaps admit to—key weaknesses and threats with the potential to impede a strategic initiative.

This highlights the fact that to be truly effective, a plan must not gloss over or fail to acknowledge unpleasant realities. It needs to be brutally honest—even, if need be, at the expense of individual egos. This is even more important during challenging times, when a strategic plan will likely need to take effect immediately. If it includes “gaps” to spare someone’s feelings, it not only is likely to fail, but it may do so with disastrous results for the company that implemented it.

A company can’t successfully execute a large-scale corporate initiative, like a merger for example, without substantial advance planning. These are remarkably complicated endeavors that require extensive evaluation and analysis, as well as the creation of a comprehensive plan that will likely change over the course of time.

Kearny Bank, for which I serve as CFO, was recently named by Fortune as one of the world’s fastest-growing companies, and as a result, I have a distinct perspective on this. Our strong commitment to advance planning prepared us to make plans when times got tough.

Early in 2020, we were in the midst of a merger transaction. Negotiations were completed, and we had made a public announcement. There was every reason to believe this was going to be little different than the many other mergers we had completed in the past.

Then the pandemic struck. Almost immediately, we were contending with challenges that we had never previously encountered, including two entirely remote workforces, a floundering and uncertain economy, and interest rate and credit environments that were, at best, unpredictable. Yet, despite this multitude of serious issues, we still bore the responsibility of ensuring the successful completion of the transaction.

It was a challenging situation, but one to which we were able to bring an extraordinary amount of forethought and planning. And in the end, everything worked out. This was the case, in large part, because we had been willing to be candid, not simply about the difficulties that confronted us, but also about what, at least at the time, we didn’t entirely know.

If there’s one thing more dangerous than a flawed or inaccurate strategic plan, it’s having no plan at all. Even the most routine of corporate actions need to be driven by careful, advance planning. Otherwise, they almost certainly won’t succeed. And what’s the point of moving forward with an initiative, even one of limited scope, if it isn’t your intention to be successful? To use a crude analogy, leading an organization without a strategic plan is like driving across the country without using navigation. You may eventually arrive at your intended destination, but you’ll make a host of wrong turns, end up lost more than once, and invariably be very, very late.

WHAT NOT TO DO

When thinking about flawed strategic plans, one example that comes to mind is that of now-defunct Green Tree Financial. In the 1990s, Green Tree executed a strategy of providing borrowers with long-term mortgages on mobile and manufactured homes, which were then securitized into asset-backed securities. At the time, this approach was applauded, and Green Tree raked in sizable profits from origination fees.

But mobile homes are much like cars in that they depreciate quickly, and many borrowers found themselves owing much more than the asset was actually worth. Inevitably, this led to a barrage of defaults. At its peak, Green Tree was providing financing in all 50 states while controlling more than 40% of the mobile and manufactured home financing market. But by 1998, the company was acquired by Conseco Inc., and, shortly thereafter, Conseco began taking annual write-downs that ultimately totaled in the billions.

Regardless of the quality, or lack thereof, of an organization’s strategic plan, there comes a time when that plan must be executed. In the midst of challenge and uncertainty, there’s rarely a shortage of risk-averse leaders whose inclinations tend toward taking a wait-and-see approach.

Unfortunately, in more than a few cases, “wait and see” is actually a euphemism for being paralyzed by worry or fear. There’s a very fine line between pragmatic caution and failure-inducing indecision.

Whether in business or day-to-day life, every situation presents a trio of options—do nothing, do something, or do something more. Undoubtedly, “do nothing” may be an entirely appropriate initial strategy. But the tipping point comes if the crisis at hand continues to worsen. In that case, an effective leader will be willing to change course and try something different, while an inadequate leader will be overwhelmed by irresolution, to the detriment of the entire organization.

ACTION IS ESSENTIAL

There are times when pausing to assess current conditions can be a wise move, particularly if there’s a reasonable possibility that circumstances may improve on their own. More often, delaying implementation of a response enables chaos—or outside players or parties—to seize control of the situation and dictate the future.

In 2008, in the midst of what would become known as the Great Recession, I was working for a small start-up. During the earliest stages of this crisis, the company’s finance team was almost exclusively focused on immediate concerns like short-term liquidity management. Long-term strategic considerations needed to be placed on the back burner.

At one point during this period, the commercial paper market had frozen, which was where a portion of the company’s short-term investment dollars were placed. It was a frightening scenario, since initial indications were that redeeming those securities for cash in a timely manner would be nearly impossible. Eventually, the U.S. Department of the Treasury and the Federal Reserve would step in to support that market, but we had no way to know that in the initial days. In order to solidify our liquidity position, we needed to act rapidly to apply unrelenting pressure on our counterparties to ensure the dollar-for-dollar redemption of those securities.

While I wouldn’t want to have an experience like that again, it’s an effective illustration of how there’s no room to hesitate or be timid when an immediate and forceful response is necessary.

STICK TO THE MISSION

During challenging times, how can companies leverage their strategic plan to help them weather the figurative storm? It should always begin with staying focused on long-term goals and not overreacting to current conditions. And that means being aware of or refamiliarizing yourself with your company’s mission and vision statements. These speak to where a company desires to go, and they remain its guiding principles regardless of how difficult circumstances may be.

At Kearny Bank, for example, our mission statement emphasizes a focus on people, performance, and relationships. These particular points of emphasis are hardly unique to a bank. But when a crisis occurs and everyone is scrambling to manage the situation at hand, this mission statement is a valuable reminder to focus on the aspects of the business that provide long-term stability and value.

Kearny Bank was established in 1884, when the United States was a very different place. So different in fact that, at the time, the country was comprised of only 38 states. In order to survive, and thrive, across the better part of 15 decades, it has been essential for the bank to remain true to its core competencies, like issuing well-underwritten loans to qualified borrowers and providing appropriately designed deposit products to our clients.

Sticking to these key tenets of our business model, which are in direct alignment with our mission statement, has enabled the bank to navigate a host of adverse business environments, including the Great Depression, two World Wars, the financial crisis of 2008-2009, and a wide variety of other social, economic, and military crises.

With the importance of mission and vision statements in mind, it’s imperative, as part of any strategic planning process but particularly during difficult times, to keep in mind exactly what the company does well—ideally, what it does better than its competitors. This is best determined via a careful assessment by senior decision makers, who then must reach a consensus about strategic direction and organizational competencies. Companies do many different things, and the larger the company, the more it’s likely to do. But by focusing on and emphasizing a few key areas of excellence, an organization puts itself in the best possible position to overcome short-term challenges.

It’s then essential to identify all of the immediate risks, with an understanding that there will be more than usual because of the crisis at hand. But risk always comes with the potential for reward, so it’s also imperative to consider opportunities for growth that may be unique to the current environment.

Once all of this is done—once leadership agrees on what makes the company strong, what its core direction is, and what risks and opportunities exist—then it’s time to directly engage with key stakeholders such as clients, stockholders, employees, lenders, regulators, and the communities that the company serves. These groups all have a vested interest in the success of the company, and their perspectives—though they may differ from those of senior management, or perhaps specifically because of that difference—are invaluable. This expert intelligence, refined by the natural self-interest of each stakeholder when merged with conventional market intelligence gathered via various channels, creates a knowledge resource that must be an essential component of the planning and decision-making process.

Along with other members of Kearny Bank’s management team, I spend a significant amount of time interacting with key stakeholders. Whether through in-person exchanges, phone conversations, or online sessions, we gather opinions about how the company can continue to evolve. In addition to helping us determine how well we’re addressing the needs of essential constituents, the information we collect quite often provides our management team with valuable insight that influences the process of tactical and strategic decision making.

Engaging with stakeholders can be a complex and time-consuming process, but it’s invaluable, and it often provides a level of intelligence that simply isn’t available elsewhere. And because it comes from those who have a distinct interest in the ongoing success of the company, it provides an unmatched degree of credibility.

TAKE THE LEAD

When discussing strategic planning and decision making, there remains one final consideration. Despite the time and effort put into the planning process, the amount of intelligence gathered, and how committed key stakeholders are to supporting an organization’s future, when times are at their most challenging, there is one factor that will often determine success or failure. That factor is leadership. Without a leader or a leadership team taking in all available information, providing expert analysis, and then making confident decisions, success is likely to be fleeting.

Consider the example of Paul Volcker, economist and chair of the Federal Reserve from 1979 to 1987. He was an exceptional leader due in part to his successful resolution of the extended period of runaway inflation in the 1970s. At the time, his decisions were often criticized, and he was blamed for plunging the U.S. into a recession.

His actions were so unpopular that, in 1980, public protests erupted in the streets of Washington, D.C. Yet Volcker didn’t shy away from making the difficult decisions that he believed to be right. He understood intrinsically that successful leadership was ultimately measured by accomplishment, not popularity. And now, years later and with the benefit of hindsight, his actions are widely considered to have been the key to stabilizing the economy and leading the U.S. into long-term economic prosperity.

While leadership is always critical, it’s even more so during challenging times. It’s in these periods when the quality of leadership will ultimately determine whether an organization becomes a casualty of circumstances or is able to continue on into better, more prosperous times.

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Strategic Planning During COVID-19 Pandemic: Business Planning for 2023

By Jessica Wishart

• Strategies for Growth

Annual & Quarterly Planning

There are a range of possibilities for the future which are currently unknowable. How long until the spread of the virus slows? When is there going to be a vaccine? Will there be another round of shut downs? Will there be additional support for individuals and businesses from the government? How long until consumers can resume their old routines, and what will their new routines look like? How long until business travel ramps back up? These aren’t questions any of us can answer right now.

While you don’t know the future, you can project with reasonable certainty a few possible scenarios for your company and evaluate the risk of following the status quo and taking wait-and-see type strategy vs. making an investment in something new and bold. Here is some advice from a Harvard Business Review on managing uncertainty:

"First, develop only a limited number of alternative scenarios—the complexity of juggling more than four or five tends to hinder decision making. Second, avoid developing redundant scenarios that have no unique implications for strategic decision making; make sure each scenario offers a distinct picture of the industry’s structure, conduct, and performance. Third, develop a set of scenarios that collectively account for the probable range of future outcomes and not necessarily the entire possible range."

As you are thinking about the possible scenarios that could play out and impact your strategic decision-making for 2023, here are some sample scenarios to consider:

• Supply chain disruptions - Are any of your key suppliers at risk? If they were to go out of business or be unable to fulfill your needs, do you have a Plan B? Have you identified other possible vendors so you don’t end up with a disruption in your supply chain? Or, can you form a partnership, make an acquisition or find another way to control more of your supply chain, yourself?
• Absence of key employees - Many schools across the country are not returning in-person in the fall, meaning childcare concerns could have a considerable impact on your workforce. Additionally, the longer we go without successfully containing the pandemic, the more likely it becomes that members of your team will be exposed to the virus and need to quarantine, take time to recover, or care for family members who are ill. You need to ensure you have redundancy built into your team so that no one person is the only person who can complete key tasks, and you need to ensure you have a plan to keep your team safe, healthy and productive.
• Impact on customers - Even if you are able to successfully pivot your product or service to fit the current environment—delivering goods to customers’ doors, switching entirely to remote offerings, or putting safety protocols in place—if your customer can’t afford your products or services, you will still not succeed. If your customer is at risk financially or is concerned and cutting expenses, how can you keep your business going? Can you shift to a new market of customers, can you discount or delay collecting payments for existing customers who are impacted? How can you mitigate the risk so your customers still buy from you, or make your product or service indispensable to them so they don’t consider leaving you?
• 2023 Recession - Usually, unemployment increases during recessions. Unemployment increased from 4 percent to 10 percent during the Great Recession (see article on annual planning for a 2023 recession ). If you're wondering why unemployment is growing, it's because companies aren't hiring. They're laying off workers and reducing their hours because they've lost market share or their margins have decreased. When business owners feel less confident about the economic climate, they tend to slow down their investment plans. Companies often reduce their capital expenditures by cutting back on new factory construction and replacing old machinery. Cutting back on investment reduces revenues, which decreases profits. Profits fall, so companies lay off employees.

If you are worried about your customers and the uncertainty surrounding their future behavior and buying patterns, you are not alone. An article from EY cites a poll sharing, "77% said that changes in customer behavior were the key risk for their company when it comes to forecasting, significantly more than those who identified liquidity and capital restraints (the next most frequent answer).”

What can you do? Talk to your customers: find out what they are worried about, what their concerns are, and what they are willing to spend money on right now and what they are excited to spend money on in the future. Get an idea of what aspects of your products or service they value most and what the pain points are.

As you are identifying scenarios and contingency plans and evaluating whether to hunker down on existing strategies or double down on something new, how will you know when to pull the trigger? What are some leading indicators you should be tracking? How can you identify early warning signs that you can watch to let you know whether to put your contingency plans in place? Develop some KPIs to monitor and help you react quickly to changes in data, and come up with a regular cadence of hearing directly from customers or the people who are working with your customers in sales or service so you have the qualitative data and lessons from the field to better understand when you need to pivot.

Strategic planning in the midst of these unprecedented times is a real challenge. Having an outside perspective to facilitate your session and prompt your thinking with the right questions could be invaluable. If you need help planning for 2022 or making adjustments to your existing strategy, our expert consultants can help.

Additional Virtual Strategic Planning Session Information:

10 Questions to Determine if Your Team Needs a Virtual Planning Sessions

How to Prepare for Virtual Strategic Planning

Virtual Strategic Planning Meetings: 7 Tips for a Great Strategic Planning Sessions

Keep Your Company Out of Trouble with a Lesson from Virtual Planning

How to Facilitate a Strategic Planning Session in 2022 (Even Virtual)

Learn About Our Expert Planning Facilitators for a Virtual Planning Session

Photo Credit:   iStock  by Getty Images

Jessica Wishart

Photo Credit: iStock by Getty Images

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Strategic resilience during the COVID-19 crisis

As we approach the one-year mark of the global coronavirus crisis, it is heartening to see that many organizations have stepped up to the challenge, adapting their businesses both to protect their employees and to continue serving their customers and communities. In a recent survey, 80 percent of executives told us they believe their organizations have responded effectively to the pandemic.

Nevertheless, some companies have proven to be more resilient than others, rapidly adapting their strategies to address both the challenges and the opportunities created by the crisis. What did they do that others did not?

To answer the question, we surveyed approximately 300 senior executives in Europe to understand their organizations’ responses in more detail. Three major findings stood out in our analysis of the survey responses. First, roughly half of executives reported that the crisis exposed weaknesses in their companies’ strategic resilience, which we define as the extent to which an organization’s business model and competitive position prove resistant to disruption. Second, business-model innovation was by far the most important strategic lever in addressing the crisis, with three-quarters of respondents reporting such initiatives—including almost 90 percent of those who felt their company’s response to be very effective. Finally, 60 percent of the executives polled said they expect these innovations to persist beyond the crisis, with more projects to come.

The critical importance of business-model innovation highlighted by the survey aligns with our earlier research. In a recent article , we demonstrated how the disruption caused by the COVID-19 pandemic has led to a rapid acceleration of trends that were present before the crisis. The study additionally found a widening gap between the best- and worst-performing companies as organizations with future-ready business models pull away from the pack. As companies start to prepare for a postpandemic world , those that have fallen behind more resilient players will need to take fast, bold action to make up for lost ground.

Testing your strategic resilience

The COVID-19 pandemic has put businesses through rigorous strategic-resilience tests. For many, it was a rude awakening. In our survey, an average of 42 percent of respondents report that the crisis weakened their companies’ competitive position, compared with an average of 28 percent who say their companies increased their competitive edge. We found that these “antifragile” organizations (to use author Nassim Taleb’s term for entities that become stronger when exposed to stressors) relied primarily on proprietary technology or a strong brand to thrive amid widespread economic shocks (Exhibit 1).

Business-model innovation emerged as the key differentiator for those that have gained ground during the pandemic. In fact, the survey respondents who said their companies addressed the crisis very effectively were 1.5 times more likely to report undertaking business-model innovations than those who thought their organizations’ responses were not effective.

Those who adopted new business models have tended to focus on five areas:

• New digital experiences, products, and services in response to changes in customer behaviors and needs. For example, many sports and entertainment venues have moved to fully digital experiences, while a technology provider has launched an on-demand fitness offering to capitalize on the category’s surging popularity.
• New partnerships, both within and outside of the industry. For example, an insurance group has partnered with a connectivity provider to set up a virtual clinic, and pharmaceutical companies have been teaming up directly with healthcare centers to accelerate vaccine development. Meanwhile, sports leagues have banded together with software companies to create virtual-reality experiences for sports enthusiasts.
• Supply-chain and operating-model adjustments to manage risk. Companies are trying to balance the need for just-in-time delivery with protection against delays or shutdowns by securing alternative sources of supply and ensuring that the labor force can continue to operate. Contact centers, for example, have moved to remote operations or split their teams into cohorts that can isolate in case of infection, allowing others to continue working.
• Sales-model changes. Many businesses have had to adapt the way they market and sell their offerings, from logistics companies that have introduced contactless delivery to restaurants shifting to home delivery and pick-up orders. Business-to-business sales have likewise largely moved to remote and digital models .
• Faster product development through more rapid iteration. For example, telecom companies, working with insurers and healthcare providers, quickly responded to the pandemic by creating telemedicine applications to assist in remote COVID-19 testing and diagnosis. Meanwhile, a consumer-packaging player transformed its product development and trial process into an immersive virtual experience.

On average, 42 percent of respondents say the COVID-19 crisis weakened their companies’ competitive position, compared with 28 percent who say their companies increased their competitive edge.

It is noteworthy that most of the innovations highlighted by survey respondents focused on the customer-facing parts of their businesses, such as launching new products and services to meet changing customer demand, adapting the sales and service models, and improving customer experience. By and large, cost and workforce reductions were mentioned only by executives in industries most severely affected by the crisis.

While the urgency of crisis response spurred or accelerated many of these innovations, they are here to stay in most cases. Sixty percent of the respondents expect their business-model changes to persist in the long term—and see more coming. Some retail banks, for example, are considering not reopening the branches they closed during the pandemic, and numerous organizations are planning for a future where employees work at least a few days a week from home. All of these reaffirm a well-tested maxim: in times of great disruption, there is also great opportunity.

Building up your strategic resilience

As the pace of change accelerates, the fastest and boldest movers are likely to pull further away from the pack. To keep pace, your strategic-planning process has to be flexible enough to deal with high uncertainty. Here are four ways you can adapt it to become more strategically resilient:

Set bold aspirations. Economic disruption serves as an opportunity to explore new business avenues. Many executives have realized that if ever there was a time to set bold aspirations and reset long-term strategy, it is now. To illustrate the size of the prize, our analysis of the 2007–2010 downturn  shows those companies that moved early and invested strongly ahead of the recovery increased their earnings before interest, taxes, depreciation, and amortization (EBITDA) by 10 percent on average, while their industry peers lost nearly 15 percent.

The accelerating trends and widening performance gap heighten the urgency to act. Many organizations managed to respond with unprecedented speed to the challenges the pandemic presented, doing in days or weeks what took months in the past. This is the time to reflect on the future role you want your organization to play—in customers’ lives, in your ecosystem, and in society.

• Develop scenarios, not forecasts. Scenarios are back in fashion but are frequently misused. They are not intended to serve as forecasting tools but rather as a means of bounding the uncertainty you confront. The goal is to understand the range of possible eventualities you may face so you can stress-test your portfolio of planned strategic moves against the extremes and ensure that your strategy can succeed in a range of future outcomes. Business leaders should develop scenarios together with finance and strategy functions to ensure they incorporate all relevant perspectives.

Create a hedged portfolio of big moves. According to our research , companies that make big strategic moves—be they portfolio-related, such as M&A, capital spending, or resource reallocation; or be they performance-oriented, such as productivity and differentiation improvements—materially increase their likelihood of outperforming the market. Such moves are especially effective in times of economic upheaval when your competitors are often paralyzed by uncertainty. The organizations we surveyed plan to explore multiple opportunities in the next six months, with the largest focus falling on cost structure and customer-experience improvements and developing new products or business models (Exhibit 2).

But even as you move boldly, it is important to hedge your bets. That could mean only triggering the move once you are confident that a favorable scenario will unfold or combining big new initiatives with no-regret moves that would deliver benefits under all scenarios (digitizing processes, for example, or improving customer experience). Another route is to make small investments that you can later expand, such as taking a minority stake in a company with an option to increase that stake.

• Adapt your strategy dynamically. Dramatic shifts are happening too quickly for companies to continue the traditional annual strategic-planning exercise. In fact, almost half the executives in our survey expect to implement a process that allows for faster iteration on their plans. Some companies have shifted to monthly strategy meetings to review their portfolios of planned strategic moves and update them as new opportunities arise or changes in the external context render some obsolete.

The level of innovation in response to this crisis has been truly impressive at many organizations. But all signs point to more months of uncertainty and change as the pandemic’s impact continues to evolve. To ensure your company is strategically resilient for whatever the future brings, start by establishing dynamic planning processes that will enable you to unlock the big moves required to come out on top while being flexible enough to change direction if needed.

Dago Diedrich is a senior partner in McKinsey’s Düsseldorf office, Nicholas Northcote is a director of strategy and corporate finance in the Brussels office, Tido Röder is an associate partner in the Munich office, and Karolina Sauer-Sidor is a partner in the Vienna office.

The authors wish to thank Alina Blos, Livia Boerner, Franziska Galie, Florian Hillenbrand, Ronja Hoffacker, Johannes Kerst, Philipp Rädle, and Patricia Vicinanza for their contributions to this article.

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Reset your business strategy in covid-19 recovery.

January 27, 2021

Contributor: Chris Howard

As the phases of the COVID-19 pandemic progress, invest your lessons learned back into the enterprise to reset strategy and build resilience.

We’ve all changed the way we operate during the COVID-19 crisis. Some changes were forced on us; others represent the height of innovation in a crisis. There’s been a reset of the workforce and work itself, a reset of the employer/employee relationship and a reset of the business ecosystem. For most, the business impact of the pandemic has been negative; for some, positive. 

Learn More:  Download the Framework for Post-Pandemic Business Planning

The pandemic may have wiped your strategy slate clean (or at least it feels that way), but you’ve also garnered invaluable experience. Now it’s time to bring together your executive team and use those lessons to reconfigure your business and operating models for a new reality. 

From here, each enterprise will take its own path. Different parts of the same enterprise may veer off from one another. Some could reduce or retire specific activities. Others could rescale or reinvent themselves. Yet more could essentially return to their pre-pandemic baselines. 

As we shift from response to recovery, the key for senior leaders is to make strategic decisions that will lead them to a renewed future state, however paralyzing the uncertain outlook may seem.

Respond, recover, renew

Gartner sees the pandemic response in three phases. The duration of each phase will vary by country, industry and enterprise — and even by business unit, product or service. The phases are defined primarily by what’s happening at each stage:

Immediate actions focused on keeping people safe and essential business functions operating. This relatively short period is marked by high effort and potentially chaotic activity. Key activities:

• Temporary fixes to stop the bleeding.

More organized/coordinated effort to stabilize operations. Medium duration. Key activities:

• Create a plan to restore a scalable state.
• Identify capabilities you need to strengthen, refactor, reopen, rehire, rebudget, resupply.

Extended period marked by strategic, durable execution across the organization. Key activities:

• Learn to conduct operations processes and workflows in new, repeatable, scalable ways.
• Use lessons learned and emergent patterns from prior phases to coalesce around a new foundation and way forward.

What it takes to lead the renewal phase

Why aren’t the phases sequential? That’s a question I’m often asked when I share this reset framework. In particular, I’m asked: “How can the renew phase overlap with the response?”

It’s an important question — and the answer highlights the importance of deliberately leading the organization to a plausible and sustainable future.

During highly disruptive times, it is possible to think about renewal as you grapple with your triage response and recovery. In fact, if you are an executive leader, it’s not just possible — it’s essential. 

I saw this mindset in progressive leaders from the earliest moments of the crisis. By the time the coronavirus outbreak became the COVID-19 pandemic, I was already talking with some corporate directors about how to reimagine their organizations’ futures. These executives didn’t relish the disruption; they knew they must seize the day and look for better ways to operate and reimagine their objectives.

A range of Gartner research, including our CIO Agenda 2020 , has shown over time that this kind of agile decision making and strategy setting results in outsized performance — and establishes a lead over the competition that sustains long after the initial disruption. In these unprecedented times, it pays to have this type of dexterous executive committee.

Read more: Create a Resilient Business Model in the Face of COVID-19

Build resilience

Dexterous resets also build organizational resilience. As you weed out weaknesses in your business and operating models, you’re better positioned to weather the next disruption.

That's especially important now. 

In the absence of a vaccine or cure for COVID-19, any rebound in business activity could easily be followed by another round of response, recover, renew, so the imperative is to absorb lessons learned quickly and build sustainable changes into business and operating models.

But first, you need to determine exactly where and how the crisis has stretched and broken your existing models — and where the risks and opportunities lie as a result. 

Coalesce senior and functional leaders around a scenario-planning protocol they can use to identify significant uncertainties and evaluate them in terms of their importance to the future of the enterprise. 

And given the highly disrupted environment, create a minimum viable strategy and use adaptive strategy tools and techniques to iterate as your new normal emerges. Make strategic planning a continual activity so it can respond quickly to the inevitable changes in business context.

Reset for a sustainable future 

As I said, it’s in the renew phase that wise leaders take the opportunity to reset or rebuild their business models and operations for a new reality. 

Gartner outlines the plausible post-pandemic pathways as rescale, reinvent, return, reduce and retire — although many of those pathways aren’t direct. 

For some, the pandemic has stressed business and operating models to the point of breaking. Organizations will ultimately reduce or retire those activities permanently. This could include moving some business capabilities out into the ecosystem (e.g., SaaS) or removing a product or service entirely. In some cases, retirement is long overdue.

Some organizations may reset by reinventing themselves for the long term. Likely examples are manufacturers that have switched production facilities to create new product suites, or retailers that have found new ways and new ecosystems in which to reach customers who can’t visit their physical locations. 

Others could reinvent themselves by refocusing their capacity. Think of government service centers that have been forced to offer their services remotely. They may be able to retire some of their physical centers and instead focus on their newfound digital capabilities. Yet others, such as digitalized parts of an organization, might rescale permanently. 

Yours may be one of the businesses that resettles toward the pre-pandemic baseline, but it won’t have been a straight path. Producers of nonperishable consumer goods are a good example. They initially experienced surging demand, but could easily see demand sink as the crisis-driven overstocking corrects. But that phase, too, will pass, returning demand toward pre-pandemic levels.

What will your future be? This crisis has created an opportunity to reset some of your goals and ambitions; it’s time to ask: “As we recover from this crisis, do we want to be different — and if so, how?” 

Chris Howard is Gartner Chief of Research and leads the Senior Content Leadership Board at Gartner, where he regularly interacts with and advises CEOs, board members and other senior executives at the world's largest enterprises.

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Research shows that the COVID-19 pandemic has affected 76.2% of US businesses . COVID-19 impacted most of these businesses negatively, disrupting everything from their supply chains to their in-store sales. 

So if you're one of these business owners, how can you adjust your operation to thrive during lockdowns, stay open for customers, and keep staff engaged? 

In this article, you'll learn five COVID-19 involved business strategies to help small businesses survive the pandemic. 

#1. Redefine your business growth opportunities 

The COVID-19 crisis and subsequent lockdown measures have disrupted many significant industries, including the hospitality industry, retail industry, and entertainment industry. Naturally, companies in these fields have changed how they deliver their products and services to customers to continue growing.

But redefining your opportunities isn't just limited to companies directly affected by lockdowns. 

If you want to keep growing during the pandemic, you will need to seek out new ways to improve your profitability, including:

• Entering new markets 
• Taking out a bridge loan and investing in new projects
• Adjusting your marketing and sales approaches 
• Targeting new customers
• Redesigning old processes with new online business tools
• Forming new partnerships (especially with local suppliers)
• Finding new ways to improve your offerings for customers 

To identify the best opportunity for your brand, you must research potential options, identify the best ones, and formalize them with a new business plan. According to this guide to business plans , your business plan should include detailed product and service plans, a market analysis, a management plan, and a financial plan for each growth strategy. 

#2. Adapt your current business models

Experts predict that coronavirus will continue to spread around the world for the foreseeable future . 

Naturally, if your brand wants to survive this new normal, you'll need to crisis-proof your business so you can continue to operate in the current economic climate. To crisis-proof your business, you should:

• Measure the damage to your company regularly so you can adapt to potential problems before they arise 
• Back up your data and embrace digital solutions to help staff work from home
• Prioritize the health and safety of your employees with workplace safety measures like social distancing, hand sanitizer, and masks 
• Reduce your cash flow to only essential expenses 
• Adjust how you deliver products and services to customers to ensure their safety when shopping 
• Re-organize your work processes to prioritize key functions (e.g. by redefining customer support )
• Establish contingency plans for further lockdowns and pandemic restrictions 

If you are self-employed or a small business owner, you could also take out a personal loan to keep your business's cash flow steady as you adjust your business models. 

#3. Rethink your financial structure

A 2020 study on 5,800 small businesses in the US found that the average brand with over $10,000 in expenses only had access to two weeks of cash at the start of the pandemic. Unsurprisingly, many of these companies had to adapt their spending habits to survive.

And the rest of us should learn from them. 

To keep your brand alive during the pandemic, you will need to establish an emergency fund to cover any unexpected events (like lockdowns). You can build an emergency fund by saving the money you would have spent on unnecessary expenses. 

To identify unnecessary expenses, sort your expenses into two key categories:

• Value-adding expenses that are crucial to running the business (i.e., expenses like supplier costs, inventory acquisition costs, online advertising, staff wages, and technology costs)
• Extra expenses that are not crucial to running the business (i e., additional office space, extra professional training, and food and drinks) 

Once you have sorted your expenses, identify expenses you can eliminate to reduce your operating budget and make cuts according to your priorities. 

#4. Retrain your workforce

While it may seem wise to fire non-essential staff and redirect their salaries into your emergency fund, this decision may hurt your business financially long term. Currently, it costs $4,425 to hire the average employee and weeks to train and acclimate them. To avoid incurring this cost later, retrain your workforce and adjust their duties to match your new business model. 

You should also consider ways to improve your employee's productivity (the quantity of their work) and efficiency (the quality of their work). Improving productivity and efficiency will increase your business's output, increasing your revenue and decreasing your expenses. 

To improve efficiency, you can use a productivity formula and calculate your current figures:

Productivity = Total Output / Total Input

Efficiency = (Standard Hours Spent On Task / Actual Amount of Time Spent on Task) x 100

Then, brainstorm business-specific ways to improve productivity and efficiency. 

#5. Build meaningful relationships 

Finally, you should prioritize maintaining good relationships with your customers. As research shows that the top 10% of customers spend three times more per transaction than the bottom 10%, maintaining a relationship with loyal customers will increase your revenue. 

To maintain a connection with customers, you could:

• Set up social media accounts and encourage customers to send you User-Generated Content (UGC)
• Establish a customer loyalty program to keep customers happy
• Improve your email marketing 
• Send digital 'thank-you' cards to customers 
• Offer special discounts to loyal customers 
• Improve your digital customer service practices 
• Convey your COVID-19 safety measures to customers with a poster (like in the example below!)

Source: National Institute of Health

New normal, business

Periods of economic crises are very stressful for companies, but they frequently result in long-term growth and new industry-wide trends. For example, people often credit the fast rise of eCommerce to the 2003 SARS outbreak in China or the rise in click-and-collect to the early months of COVID-19. 

If you follow the tips in this guide, your company can emerge from COVID-19 stronger and more profitable than ever before. 

Your New Post-Pandemic Business vs. Your Previous Career Did you start a small business during the pandemic. Use these three questions to determine if entrepreneurship is right for you.

Copyright © 2023 SCORE Association, SCORE.org

Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.

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If 2020 and the COVID-19 pandemic taught businesses anything, it was to expect the unexpected. COVID-19 disrupted businesses in every industry and of every size, bringing many strategic plans to a screeching halt as efforts were redirected to managing the crisis. The pandemic is a prime example of the effects a crisis can have on a business, but a crisis can be any unexpected event that makes an organization unstable. 

While you can’t anticipate every potential situation that might come your way, you can strategically plan for a crisis . A strong strategic plan can help you weather the storm and put yourself in a good position to reach your goals when the crisis is over.

In This Article

Strategic Crisis Management

• Define Your Recovery
• Evaluate Your Current Strategic Plan
• Create Your New Plan
• Rally the Troops
• Look to the Future
• Build a Repeatable Success Model
• Track Everything in the Cloud
• Keep Everyone Focused on Strategy
• Find A Way to Link Stand-Alone Projects to the Plan
• Get Creative When Using Your Resources

When Is the Best Time to Create a Crisis Strategy?

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Effectively managing a crisis depends on leveraging many different resources throughout your business. Coordinating these resources and making decisions in the middle of a situation that might be confusing or emotionally charged may not yield the best results. A strategic crisis plan provides an objective, pre-designed framework that guides your activities throughout the crisis, helping to ensure an effective response and an easy recovery. It incorporates your organization’s values, vision, and mission into a strategy built for meeting your goals.

A strategic crisis plan is one of the most valuable resources you can have when weathering a crisis. It outlines everything from communication tactics to the parties responsible for solving specific problems. A good plan can help with:

• Making decisions under pressure: Since it’s developed in stable times, a crisis plan can mitigate the subjectivity, stress, and confusion of the crisis. You get more peace of mind, knowing that you have a well-developed strategy in place made with plenty of consideration and planning.
• Minimizing the adverse effects of the crisis: A crisis plan includes strategies and steps for responding to the crisis effectively. For example, if one of your suppliers goes out of commission, your crisis plan might include alternative suppliers you’ve already vetted. Instead of losing precious time researching suppliers or panicking and paying a premium for subpar products, you have a dependable solution.
• Setting yourself up for a strong recovery: Many organizations throw their overall strategy out the window when a crisis appears. After the crisis, they must essentially start from scratch to meet their goals. With a strong plan, you can keep your goals front and center and put yourself in a good position for success after the crisis. Your plan also helps you maintain key relationships with partners and your reputation, so you have the resources you need for growth.
• Staying flexible during the crisis: Crises are unpredictable, and having reliable options and criteria in place supports flexibility. You may need to shift gears to succeed — a good plan leaves room for adjustments.

After the crisis has run its course, your plan should lead you to a point of stability. From here, you should be able to recover and get the business back to about the same level of performance as you had before the crisis.

5 Steps for Effective Strategic Planning During Crisis

As we approach a “new normal” and organizations begin to look to the future, refocusing on a strong strategic planning management process is crucial. Strategic planning is more important now than ever .

Follow these steps to make the strategic planning process more manageable, even amid all the uncertainty.

1. Define Your Recovery

At some point, your organization set a vision for the future. “This is what we will accomplish over the next year” is the intent behind any plan.

With many organizations upended in a crisis, you may find the business in a very different state from the one it was in when you made your strategic plan. It’s even more likely that things won’t feel normal in the continued future. For that reason, one of the first steps involves reimagining what the new ‘normal’ will look like.

In reimagining the new normal, define what recovery means for your organization.

What must happen for the business to remain both viable and competitive? What organizational and departmental targets will be mission-critical? What must occur for you to ensure that you can continue to serve and meet the needs of your clients?

Trevor Cartwright of Forbes suggests you begin the strategic planning process by establishing a small set of non-negotiable decision criteria. This will provide objective guidance for evaluating strategic moves you might make in the weeks and months ahead.

Collaboration will be a key component in defining recovery. Ensure that the right people are a part of the conversation at the onset of your strategic planning process. This will increase the likelihood of identifying the key initiatives for your organization’s recovery.

2. Evaluate Your Current Strategic Plan

After establishing your non-negotiable decision criteria and defined recovery, evaluate your current strategic plan . Leverage your new criteria to gauge the relevancy of your plan.

Deprioritize any goals, targets, and initiatives that don’t align with the mission-critical recovery plan.

If elements of your company’s strategic plan align with the decision criteria for recovery, evaluate the timeline for accuracy. Timelines will likely shift, and resource deployment will need adjustment.

Lastly, evaluate how current conditions are impacting results. In some cases, the crisis will not impact results at all. In others, it will impact results dramatically. Understanding the extent of the impact will help you determine how to move forward.

3. Create Your New Plan

With your decision criteria set and current plan evaluated, it’s time to develop your recovery plan based on your vision of “the new normal.”

The recovery plan you develop should detail both the “how” and the “why” with clear alignment.

With so much uncertainty and even more variables, it’s important to keep a few things in mind as you create your new plan:

• Plan short-term but think long-term. Your new plan will likely be shorter-term, to get you to a place of stability and recovery. But don’t forget that longer-term strategic thinking will help your future viability.
• Flexibility is imperative. Your non-negotiable targets may not change, but the ways in which you go about achieving them might.
• Build scenarios. Any approach to strategic planning process begins with assumptions and bets. Clearly identify those assumptions and create best-case scenarios, worst-case scenarios, and most-likely scenarios. This will lend itself to agility and realistic decision-making.

4. Rally the Troops

Let’s face it. Morale has probably taken a hit. Engagement might be at an all-time low as people collectively face unprecedented personal and professional challenges. This situation must be acknowledged.

Still, you may find an opportunity to shift the narrative and generate hope. As difficult as things are, you have started the process of recovering, which means that a recovery is still an option. Your organization can still recover from this crisis.

Communicate what will be required for the organization to successfully recover. Emphasize your commitment to doing so. This could include divestitures, investments, expense cuts, new technology and infrastructure, restricting, and new or modified roles.

5. Look to the Future

A rapid change of pace can leave leaders, organizations, and employees to engage in quick decision-making during the crisis. While it seems scary, it often has led to beneficial outcomes, like rapid learning.

How can your organization take the learnings from this experience and carry it forward? What can be done to ultimately make the organization better, more agile, and more prepared for the future?

During and after a crisis, you may find that your business resources dwindle to nothing. COVID-19, for instance, tanked tax revenues, caused furloughs and layoffs, and slashed budgets. As a business recovering from a crisis, how do you ensure plan execution with little to no resources?

Begin with these easy steps below as a starting point to keep your strategy a top priority.

1. Build a Repeatable Success Model

As you begin to execute strategy across your plans and initiatives, it is important to track all progress, updates, and any challenges you run across. Keeping good records can help you avoid reaching the end of the fiscal year without any understanding of your successes and failures.

Once you have direct visibility into how you achieved your success, you can build a repeatable success model for years to come. If you do have limited resources and staff for some time, you will still have a process in place that ensures your successful execution.

2. Track Everything in the Cloud

“The cloud” can be a scary phrase until you realize it can prevent you from losing all your work and progress in your plans and projects. Many in-state and local governments suffer from cumbersome processes that stem from an unwillingness to migrate to the cloud. Imagine how many employees were cut due to the pandemic. If they were tracking projects in disparate spreadsheets not backed up by the cloud, their work is now gone forever.

You never want your plans and initiatives to fall victim to bad timing. IT modernization allows your team to track their work, all while knowing it stays safe in the cloud. You know that their updates and progress will still be there even if they leave.

3. Keep Everyone Focused on Strategy

Not everyone goes to sleep at night thinking about strategy and progress like you do. Most employees have day-to-day tasks that must get completed and are assigned strategic tasks on top of that work. Keeping everyone focused on the strategic plan helps ensure items are completed on time, progress is being made, and your plan doesn’t sit dusty on the shelf.

To keep everyone focused, schedule a regular cadence of updates and team meetings. Everyone should know they are accountable for their parts of the plan.

4. Find A Way to Link Stand-Alone Projects to the Plan

With a dwindling budget, it is more important than ever to show the impact of projects across the organization. Stand-alone projects may seem like they cannot connect to your strategic plan, but try and find their area of impact anyways. If no direct impact is visible, you may end up with further budget decline and be unable to complete your project. This article provides more insights into the importance of connecting projects to strategic goals.

By building a repeatable success model, migrating to the cloud, keeping everyone focused, and connecting projects to strategic goals, you will help mitigate some of the risks associated with the current crisis at hand.

5. Get Creative When Using Your Resources

You might have access to more resources to achieve your goals than you think. Work with your project team to brainstorm new solutions and ways to leverage your team members’ skills. Some examples of limited resource planning might include pulling from other teams or outsourcing some tasks when you’re short-staffed.

Perhaps one of your employees used to work in another position and can use those skills to help you meet your goals. If someone in your administrative team wants to expand their career, you could add them to the project team. Combatting limited resources is never simple, but a good brainstorming session can help you maximize your existing resources and leverage your team’s diverse skills.

The best time to build a crisis strategy is yesterday. The second-best time is now. A strategic crisis plan does you no good if you build it after the crisis appears. Instead, focus on creating a plan as soon as possible to protect your organization from the unexpected.

In a perfect world, this wouldn’t be a problem, but modern businesses have a lot on their plates. Building a plan will require time and money. However, the investment pays off in incalculable amounts when a crisis appears. It can be the difference between weathering the storm and going under.

While you may not need a complete plan immediately, you should decide on a timeframe for when you want it finished. As you get started developing your crisis plan, keep the following tips in mind:

• Consider possible worst-case scenarios: Start by coming up with a few hypothetical situations that reflect your worst-case scenarios. By working through these situations, you know you have a reliable plan for the most severe crises and can work backward to plan for less-severe ones.
• Outline the chain of command: If everyone thinks someone else is taking care of a task, it won’t get done. Establishing a chain of command should be one of the first steps in building a crisis plan and can help you delegate.
• Zero in on communication: Another important early step is figuring out your communication plan. In a crisis, being slow to respond or silent can reflect poorly on your organization. Build your communication plan thoroughly and identify responsible parties. Include employees, customers, partners, stakeholders, and anyone else involved.
• Practice your plan: Like fire drills and tornado drills, practice makes perfect when executing strategy. Run through the plan often and thoroughly to identify weak points, answer questions, and solve problems that may appear.
• Improve the plan: Your business is always evolving, so your crisis plan should evolve with it. Revisit your plan regularly and make changes as needed. If you need to use it, take note of any issues and problem-solve accordingly.

Even the best plans won’t go far without strong organization. AchieveIt is a comprehensive strategy management system that helps you build, visualize, manage, and improve upon your crisis plan and other projects. Use the planning methodology that you prefer, assign tasks to specific employees, and gain insights into the results. Whatever comes your way, AcheiveIt can help you protect your organization with our strategic planning software . 

Request a demo today to see AchieveIt in action and learn more about using it for your strategic crisis plan.

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5 business strategies for success during the pandemic

• Strategy and innovation

When the coronavirus pandemic led to lockdowns and restrictions that drastically slowed business and disrupted supply chains, many companies were forced to make financial cuts.

But every slash of the budget is not created equal, experts say, and companies that are making strategic decisions with their clients and customers in mind will likely fare better than others.

In some cases, this might be the time to invest in new opportunities.

Here is advice from experts on how companies can emerge from the pandemic intact — and maybe stronger than ever.

Make strategic cuts

Facing a crisis, it can be tempting for business leaders to take a “peanut butter approach” to cost-cutting, said Alexander Bant, vice-president of research in the finance department of Gartner, a global business advisory firm.

“Too often organisations take a blanket approach when they take costs down,” Bant said. “So they’ll say, ‘We’re going to take every budget down by 2%, or we’re going to take every region down by 5%.’”

Aubrey Joachim, FCMA, CGMA, a global trainer in finance, cautions against that kind of thinking. “To arbitrarily cut resources without looking at all the consequences is not the right thing to do,” he said.

Instead, Joachim said, companies need to make strategic cost-cutting decisions based on their customers’ changing needs. Airlines naturally laid off thousands of workers, he said, because it will likely take several years for the industry to rebound. But many other industries will come back sooner and don’t require a massive reduction in labour.

One reasonable area to cut is real estate, since many employees are working from home and companies have realised they can be just as successful remotely, Joachim said.

Continue innovating

Companies have so many opportunities now to try new things that will help them be more successful in the long run, Joachim said. “There are risks in continuing to do what you did.”

Cubewise, a global company that implements planning and budgeting software for clients, has taken on new projects during the pandemic, said Dave Heleu, director of the company’s Belgium office.

The company did not lay off workers despite a slowdown in business, Heleu said. It utilised workers who were “on the bench” and invested in building new solutions, leveraging existing experience around supply chain reporting and planning. Now, Cubewise has formed a new business unit and is giving presentations to potential clients.

“For the next three to six months, we are hopeful and positive about finding new customers in the supply chain area, thanks to that new investment, which we wouldn’t have had otherwise,” Heleu said.

Bant points to Chipotle as another example of innovation. The restaurant opened its first digital-only restaurant this month in which all customers must pre-order online instead of interacting with service line workers.

“They are funding the right people internally at Chipotle to think about innovation at a time when other companies in the restaurant space are just trying to get their costs under control,” Bant said.

Companies such as those working in design or pharmaceutical research should use the slowdown as a chance to upskill workers, Joachim said.

“You would see an opportunity of keeping them even if nothing is happening immediately,” he said. “You would use that opportunity to enhance the knowledge and competencies of those people. So when things turn around, they can be put to good use.”

Keep customers informed

Haycarb PLC, a publicly traded company based in Sri Lanka that accounts for about 16% of the global supply of coconut shell activated carbon, has not seen a decrease in demand, said Rajitha Kariyawasan, FCMA, CGMA, managing director of the company.

That’s partly because demand for activated carbon is generally recession proof. It is being used widely in the mining of gold, which has risen in price during the pandemic as investors rally behind the precious metal as a safer haven.

But disruptions in the supply chain have led to significant problems and rising operational costs for Haycarb, Kariyawasan said.

So the company raised its prices — but not before letting customers know about the increases in advance. Company leaders talked to customers quarterly to keep them in the loop.

“It was sometimes difficult, because customers said, ‘OK, everybody is suffering through COVID, so why are you increasing prices?’” Kariyawasan said.

The company explained the change was necessary to keep the supply chain intact moving forward. “Most of the customers were appreciative of the supply reliability during the pandemic,” he said.

Haycarb did not lay off or furlough workers, according to Kariyawasan, and only the chairman and managing director took a pay cut.

Streamline processes

When companies need to cut costs, a common reaction is to add more layers of bureaucracy, Bant said. They might introduce new pre-approval requirements for spending on travel or technology.

But such measures can slow things down unnecessarily, Bant said. “All these controls clamp down the ability of the organisation to move quickly. The organisations that are going to recover more quickly didn’t clamp down too far or too fast.”

Bant said companies should allow managers enough flexibility to do what they know is best.

Haycarb has switched to an electronic approval process, Kariyawasan said. Part of that decision was based on necessity — fewer people are in administrative offices — but it also allowed the company to move faster.

The company gave factory managers more power to spend quickly, he said, and urgent approvals can be handled via phone calls with the company’s chairman or board.

Bant said companies that introduce complicated and time-consuming processes are “placing an anchor on our ability to move as quickly as our competitors”.

Worry less and learn valuable lessons

When the pandemic began, Heleu said, Cubewise’s customers were caught off guard and many initiatives were shut down. That made him worry the most.

Looking back, he said, he wishes he could tell himself to worry less. He sees companies taking a different approach as COVID-19 cases spike again across much of the world.

“I notice businesses are reacting to it a lot more maturely. We’ve seen it before. We know what’s going to keep running. We know that we’re going to get through it,” he said. “So I see less of this wild cost-cutting.”

Organisations made similar budget mistakes during the global recession in 2007–2009, Joachim said. But some saw it as an opportunity “to pick up smart resources, smart people”.

“Despite the market downturn, they began hiring people,” he said. “So when the situation turned around, who was ahead of the curve?”

Learning valuable lessons during the pandemic is key, according to experts. At Haycarb, Kariyawasan said he wishes he had one or two more factories to increase surplus capacity in situations like these. Joachim said a common household item — toilet paper — is a prime example of pandemic miscalculations.

Toilet paper manufacturers ramped up production as people stockpiled ahead of lockdowns. And then there was too much toilet paper, much of it sold at discounted prices.

“Things happened that should not have happened,” Joachim said. “That’s perhaps because people weren’t really thinking through and modelling the consequences. I suppose this is where good finance professionals should have been at the forefront.”

— Sarah Nagem is a freelance writer based in the US. To comment on this article or to suggest an idea for another article, contact Neil Amato, an FM magazine senior editor, at [email protected] .

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• Coronavirus

Business Strategy During A Global Pandemic

14 July 2020

Anthony Boe, Business Growth Advisor at the Hub shares tips and tools available to help businesses redefine their strategy and develop an implementation plan to quickly respond to the changing economic environment.

When a business sets its strategy, it is normally based on the assumption it’s a piece of work that will sustain and inform their activities for several years, with business growth and success as a core goal. 

Under regular circumstances, strategic planning, when done well takes into account many factors including economic predictions, the future trading environment, competitor activity, technological advances, financial projections and changing customer needs. These insights then feed into a creative and coherent strategic plan that a company can use to move forward confidently.

As Louis Pasteur said: ‘fortune favours the prepared mind.’ If your company had done the necessary strategic thinking, then you will indeed be prepared and optimistic that the future holds great things for your firm.

That was until a global pandemic arrived - quickly, stealthily and with huge impact - leaving business strategies in a tailspin. The economy went into reverse, and even the most loyal of business clients had to socially distance themselves from anything but the most essential of purchases.

March 2020 saw a vast number of businesses close their premises, and huge numbers of staff were either furloughed or started to work from home. The government introduced unprecedented economic responses to help business and staff to weather the storm. As welcome as this support was, it won’t last forever.

COVID-19 has changed the business landscape for everyone. Few companies have not been affected by it in some way. While some of the changes may be temporary, some may present long-term challenges. We can be sure the future will remain in flux for quite some time yet as the business environment changes alongside our progress in combatting the virus.

Back To The Drawing Board

Charles Kettering said: ‘My interest is in the future because I am going to spend the rest of my life there.’ That effectively sums up where businesses find themselves in mid-2020. Re-planning for the future, adapting to the changes and looking for opportunities in a post COVID-19 world.

Some of these responses will necessarily be short-term in nature, just to keep things going. But many of these actions will be about adapting the business to a very different environment which may brim with new opportunities, innovations and ideas.

And that brings us back to strategy.  How can businesses quickly reconstruct their plans to meet the challenges ahead?  In a forest of well-worn business models which of them offers all the relevant content to enable the re-setting of strategy efficiently and flexibly? 

At the Business Growth Hub, we often use the VMOST framework.

What Is Business Strategy?

One of the pithiest definitions of business strategy comes from business giant Jack Welsh: ‘In real life, strategy is actually very straightforward. You pick a general direction and implement like hell’. That summarises how many businesses are operating under the shadow of COVID-19, irrespective of whether they’re struggling to survive or capitalising on unexpected opportunities.

A judicial and agile application of the VMOST framework developed by Rakesh Sondhi (Total Strategy1999) will undoubtedly help to define or redefine your strategy. So, let’s have a closer look.

This model is designed to help a business to review their overall direction of travel by breaking it down into its essential parts.  It would typically take some time and supplemented by other approaches like a SWOT and PESTEL analysis and maybe frameworks like the Ansoff matrix or Porter’s 7 Forces model. 

However, businesses responding quickly to changing circumstances can just as easily use the VMOST to formulate their ideas and move swiftly to implementation. At times like these being ‘fleet of foot’ is a useful business trait.

  The advantage of the model is it can be done quickly and helps you to build a strategy in a controlled, manageable way. It also allows for multiple changes in tack as the business environment changes. As we make our way through the COVID-19 crisis, we can assume the strategic horizon will move ever-further away. Before then, for those who have fervently grasped the strategy nettle some valuable and enduring insights and changes may have been achieved.

Tips For Strategy Development During A Pandemic

As you conduct your strategic planning, there are a few useful tips to add to your thinking. The following will make the process easier and simpler. It may also include some actions you wouldn’t usually have considered in a COVID-19 free world. But circumstances may need you to change your thinking, so an open mind is essential!

Leadership is key: If ever there were a time for effective leadership , it’s now. Employees will long-remember those who stepped up and displayed the right combination of strength, accountability and empathy in the COVID-19 crisis of 2020. Being a good communicator will certainly add value too. For those with the ‘right stuff’ the call to action has arrived, it’s time to make your mark.

Focus on People Instead Of processes: Under challenging times, it’s people who make a difference.  A team of skilled and motivated people with a remit to make a change is much more critical than doggedly following and developing processes. Get the right people involved with your strategy development and encourage their ideas and insights.

Be Flexible:   In such a dynamic situation, worrying about minutiae is futile. Your vision and ambition to strive or thrive are much more important than managing every last nuance. Set yourself up to respond to changes as they arrive and expect regular internal and external challenges to your assumptions and decisions. 

Collaborate:   If there was ever a time in business where collaboration is needed , it’s now. Going at it alone may not cut it. Look for cross-functional collaboration internally but also with suppliers, stakeholders, logistics providers or even competitors. Some of these approaches may only be temporary, but they could make all the difference.

Keep It Simple (KISS):  This is not a time for dense multi-page documents. The adage ‘keep it simple, stupid’ should always be in play. The agile approach of single-page documents that are action-oriented with crystal clear communications are the order of the day. It makes things easier to track and more straightforward to change. 

Strive And Thrive

Strategic planning is a vital activity for any business big or small, but it would be a very far-sighted firm who predicted COVID-19.

However, the same rules broadly apply—those of taking a systematic and considered approach to the response and being clear-sighted about the resulting actions. While the business environment may have changed radically, those firms who face down the issues head-on using models like the VMOST are most likely to make it through to the other side. 

Let’s finish with one last quote from business academic Michael Porter, one that sums up our theme perfectly: ‘The Company without a strategy is willing to try anything.’

Don’t let that be your firm.

For more information on redefining your Coronavirus strategy and other business issues,  call us on:  0161 237 4128  or email us at:  [email protected]

Anthony Boe, Business Growth Advisor

Anthony has over 25 years’ professional experience built within a number of blue chip and public organisations, which include, telecoms, banking and training organisations. 

He has extensive experience of project and programme management, quality management, process improvement and innovation development. He has worked as a volunteer director in the performing arts sector and built his business advisory skills working for Business Link and Pera Training.  In addition to having an MBA, Anthony is SFEDI accredited, qualified in Lean Six Sigma, is a Prince2 practitioner and has a diploma in Action Coaching.

The information provided is meant as a general guide only rather than advice or assurance. GC Business Growth Hub does not guarantee the accuracy or completeness of this information and professional guidance should be sought on all aspects of business planning and responses to the coronavirus. Use of this guide and toolkit are entirely at the risk of the user. Any hyperlinks from this document are to external resources not connected to the GC Business Growth Hub and The Growth Company is not responsible for the content within any hyperlinked site.