What Can't You Do Without?
I was recently in a situation where the house in which I was living had its power cut due to a severe winter storm. 2 ½ days later, when I left, power still hadn’t been restored; my host was embarrassed, the house was cold and no hot food could be cooked except for on a small camping stove.
As things go, I could put up with the discomfort this caused, although when I left it was for a long flight back to the Far East and I hadn’t been able to have a proper shower for 2 days. It showed me what I took for granted when making plans.
It made me think about what businesses also take for granted when planning their budgets, a new business venture or to introduce a major change. Things can and do go wrong. Disasters don’t come with advance warning.
Different businesses depend on different things happening a matter of course for their smooth day-to-day running. These can vary depending on country, legal system, infrastructure, weather and a host of other variables. In the UK commuter travel can often be disrupted by unseasonable weather conditions such as snow or (as in 2014) heavy rainfall. For businesses that depend on their staff being able to take a train from locations up to 2 hours away, this may mean the difference between staying open or not.
How do you set about identifying the critical support factors for your business, especially as they could vary depending on time of year, month or day? Some things are relatively easy to identify; for example electricity. Others (like failure of transport infrastructure) won’t be. To Provide a framework, try using this which looks at the basic stages of providing a product or service. Each stage depends on certain activities or events combining in the right sequence to allow you to move on.
Inputs
|
Payments
|
Processing
|
Outputs
|
Collections
|
Say, then, we start with “Inputs”. These will be in the form of raw materials, parts information or any number of items.
Examine what “inputs” you need to start the ball rolling. Include people/companies involved in delivering them (does your supplier use a third party haulage agency to make deliveries, for example?).
What information do you need about delivery dates, prices, etc (or is information part of your “input”)? Where does it come from (remember, it may come from inside the business as well as outside)?
Who is/are your supplier/suppliers? Where are they located in relation to your warehouse/factory/office?
How do they get goods to you (“delivery channels” - road/rail/air/sea)? Do deliveries from suppliers/to buyers depend on weather? Does you supplier have to send raw materials/parts by road/rail/sea which can be disrupted by unseasonable weather? Is the supplier’s warehouse located in an area prone to flooding?
Who is involved on your supplier’s side in getting things to you? How an they be contacted? Where are they based? Who is their deputy in case there’s an emergency?
What processes do they undertake to ensure delivery? Some consider this irrelevant, but if you don’t understand the potential pitfalls in your supplier’s operation, how can you safeguard yours?
What do you need in terms of power/water/gas/oil? How secure are your supplies? Do you need to have reserve gas tanks?
Which laws or regulations govern your suppliers, your business and customers? What happens if one of you is found to be in breach? Could they change suddenly, putting you, your suppliers or buyers at risk?
Environmental concerns are now playing an increasingly significant part in business. Could you, your suppliers or customers be unknowingly (or knowingly) in breach of regulations, which could cause a shut down?
What do you use in terms of technology in your business? How about your suppliers and customers? How robust are your systems (could they be attacked by a virus/malware)? Do you back up information regularly and store it securely? What happens if you lose your electronic records?
Inputs
|
Payments
|
Processing
|
Outputs
|
Collections
|
Raw Materials/parts
Information
Supplies/suppliers
Location
Delivery Channels
Weather
People
Processes
Utilities
Legal/Regulatory
Environment
Technology
|
Raw Materials/parts
Information
Supplies/suppliers
Location
Delivery Channels
Weather
People
Processes
Utilities
Legal/Regulatory
Environment
Technology
|
Raw Materials/parts
Information
Supplies/suppliers
Location
Delivery Channels
Weather
People
Processes
Utilities
Legal/Regulatory
Environment
Technology
|
Raw Materials/parts
Information
Supplies/suppliers
Location
Delivery Channels
Weather
People
Processes
Utilities
Legal/Regulatory
Environment
Technology
|
Raw Materials/parts
Information
Supplies/suppliers
Location
Delivery Channels
Weather
People
Processes
Utilities
Legal/Regulatory
Environment
Technology
|
Repeat this list for “Payments” (for goods delivered), “Processing” (where you turn raw materials, components or information into products or services for customers), “Outputs” (delivering your product/service to the customer) and “Collections” (getting payment from customers). You will change some of the headings that you search, or even delete them. The point is to find a framework and headings that work for you and help you anticipate and plan for the unexpected.
I have spent more than half my life delivering change in different world markets from the most developed to “emerging” economies. With more than 20 years in the world financial services industry running different service, operations and lending businesses, I started my own Performance Management Consultancy to offer solutions for improving performance, productivity and risk management. I work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by email . My website provides a full picture of my portfolio of services. For strategic questions that you should be asking yourself, follow me at @wkm610.
Labels: Crisis Management, Customer Care, Productivity, Risk, Strategy
posted by William Martin @ 09:39
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