29th August 2023 Posted by - Alexander Accountancy
Rethinking business resilience
Being resilient by choice is critical for both survival and for strategic advantage in an era where disruption is the norm. The threats businesses face today are complex and becoming more frequent than in previous times. We have seen a pandemic, an ongoing war in Europe with supply chain issues, a cost of living crisis, extreme weather and frequent ongoing cyber-attacks.
These events are more interconnected than before the Pandemic, and resilience is now critical for maintaining consumer and stakeholder trust. Many leading businesses are now making resilience a strategic aim to look at how they make the right investments in technology, talent and data.
Here are some practical thoughts that may help you think about resilience in a more strategic way:
- Think about a 360-degree view of risk and look for trouble before it finds you. Look ahead and assess future scenarios, perform sensitivity analysis or “What if” situations on your budgets or projections and examine changes in costs and customer behaviours.
- Use Generative AI (such as ChatGPT) to examine the effect of a change on your projections and let it outline future risks in your industry and play out scenarios in your business. Using your insight, advanced data analytics can help you identify early warnings of issues and opportunities.
- Know what areas you want to succeed in and where you cannot afford to lose. This involves understanding why you want your business to be resilient and will help target any investment to what is critical to your success.
- Ask yourself “When does a problem go from being a nuisance to unbearable?” What would wreck your business? If you accept that interruptions are more common in the last few years and that they will continue, then look at the risk from a customer, reputational, and financial viewpoint. This will help you develop contingency plans for realistic worst-case scenarios and help you get a clear sense of purpose.
- You cannot prevent external events happening, but you can plan for the worst across the risks your business has identified.
- Get everyone in your business involved in the strategy for building resilience. Discuss scenarios and canvass opinions. Ensure everyone knows their roles and responsibilities so they can act decisively during a crisis.
Our most successful clients are redesigning how they look at risk and using new predictive technology to play out scenarios to remain resilient in the future.
Please talk to us about the practical steps you can take, such as real time information, preparing budgets and “What if” analysis. See: Guide to building business resilience (british-business-bank.co.uk)
