Keep the Cash Coming!
Have you ever seen comments about how someone took an item to a business for adjustment, repairs or servicing but were turned away because they hadn’t purchased that product (or service) from that business (even though the business dealt in that very product/service)?
With COVID-19 throwing ever more challenges at the world, flexibility is proving to be key if business are to show the resilience needed to survive. Whereas in the past certain “policies” may have been easier to maintain, particularly in cases where warranty/guarantee or sole supplier agreement clauses may have been in force, the whole supply and service chain now needs a critical re-think of how it does things.
By refusing to provide services (for whatever reason) that they would if they had sold the product/service, businesses are effectively limiting cashflow. In “good times”, this may not have been a problem. In harder times, it could reduce a business’ chances for survival both by giving the impression that the business is “uncooperative” and from the negative publicity resulting therefrom.
It may also harm the brand for which said business may be a recognised outlet. Like it or not, if people see “our” brand name on a store, they associate it with us, so any poor service reflects directly on us. Trying to hide behind a “franchise” or “licensee” agreement cuts little ice with angry consumers and only gives the impression that we’re exploiting legal technicalities to avoid responsibility.
We’re all going to face decisions in this respect if we want to see our brands survive long-term. In some cases, it may mean providing the service; in others, explaining up front why we can’t and providing a workable solution.
I’ve 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 international financial services around the world running different operations and lending businesses, I started my own Consultancy to provide 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: Customer Care, Financial, Selling, Strategy
A New Normal?
I recently came across a fascinating article on bbc.com which discussed how attitudes to work may well have undergone a seismic shift in the face of social distancing regulations that many have brought in.
The conclusion was that our relationship with work has changed permanently. People are now thinking differently about their jobs “… as new data shows that remote working will probably become the norm – researchers from McKinsey predict that 20% of the global workforce could work from home three-to-five days a week. It’s unlikely that we’re going back to the ‘old’ way of doing things any time soon.”
Others are improving their skill set, acquiring new skills or even starting a new business. It’s an exciting time for all. Some are reporting less stress due to not having to commute every day (I can endorse this!). For some, just that daily commute made a job “unfulfilling”.
Thanks to the advances we’ve seen in technology, many jobs now lend themselves more to remote working than, say, 25 years ago. Businesses will find they don’t need as much office space (some have predicted they can operate with just 35% of their existing square footage), meaning that landlords will see a decline in rentals as businesses “downsize” offices or move out of larger urban centres to more remote locations, perhaps binging new jobs to areas that need them.
However, with the new Work From Home (WFH) ethos, other challenges are also presenting themselves, first amongst which is balancing home life and work life, particularly with young children. As some have already found, when working from home, neither clients nor younger children are great respecters of “boundaries”.
For all workers, whether “experienced” or just beginning on the career ladder, connecting with new/younger colleagues with prove more challenging (“Zoom” meetings don’t quite provide the same interaction as “face-to-face” interaction on a meeting room.
Building networks and careers will also need a new approach. It’s not as easy to “relate” to someone we see only on a computer screen as it is when working alongside them on a daily basis.
Whilst “technology” offers more possibilities to those who have access to it, some aren’t as fortunate as others. We may see a deepening of inequalities between the technological “haves” and “have-nots”.
Equally, some industries (e.g., manufacturing, assembly, packaging, hospitality) will still require people to work alongside each other. Often, it is these jobs that provide an introduction to many youngsters to the “working world”.
In short, both challenges AND rewards seem to be “major” and can’t be ignored. The key questions are now:
- How will employers respond?
- Will they allow remote working more often?
- Can they develop the policies and processes to facilitate WFH?
Employers will need to recognise that the need to attract and retain good staff will depend partly on their willingness and ability to see that workers may now expect WFH 3-5 days/week as a “right”
I’ve 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 international financial services around the world running different operations and lending businesses, I started my own Consultancy to provide 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: Leadership, Productivity, Strategy, Teamwork
Cash is King
If there’s one thing that the current COVID-19 pandemic has shown, it’s that cash (or “near-cash” is definitely king. Businesses with sufficient (let alone excess) cash or whose business doesn’t depend on customer footfall on premises (e.g. restaurants, hotels) have been able to ride out the current storm better than others.
What has this taught me? It’s that I need to have enough cash or “near cash” to run my business for a year at least.
If we take an example, look at the low-cost airline Flybe. This was a popular UK-based airline providing flights in smaller aircraft to various destinations in the UK and Europe. Unfortunately, rapid expansion and the accompanying debt service costs combined with COVID forcing passengers to stay at home took their toll and the airline went into receivership.
One of its main “hubs” – Southampton (Eastleigh) Airport, is now a “ghost airport” with hundreds of jobs lost.
So not only were jobs in the airline lost, but support jobs in airports also fell victim.
Flybe depended on people flying and, when this couldn’t happen, their business model collapsed. Other larger airlines are facing the same predicament.
Depending on your business, your buyers may not be able to pay you either, if they aren’t able to collect the cash needed. In this case, you have a list of people who owe you money but can’t pay you – possibly because they’re hoarding what little cash they have to keep themselves afloat…
Cash is king, but I also mentioned “near cash” which, for many, will be investments in bonds or equities which can be sold relatively quickly. Some businesses to which I used to lend in my banking days also had “contingency credit facilities”, i.e. overdraft facilities or other lines of credit on which they could draw when needed, but not as part of day-to-day business. Such facilities still have to be paid back though, so a long-term source of cash income is still needed. Small businesses are unlikely to have the balance sheet “heft” to support such facilities in any case.
In future, We’re going to have to think a lot more about how long our businesses can survive in the face of a “business drought” – particularly if our business depends on people actually being present.
I’ve 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 international financial services around the world running different operations and lending businesses, I started my own Consultancy to provide 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, Financial, Leadership, Risk, Strategy
Plan (for the Worst)
What can go wrong will go wrong – and at the worst possible moment.
Many people will have heard the above saying (known as “Murphy’s Law”) in some form or another. Fewer will have heard of Flannagan’s Law (“Murphy was an optimist”) …
The US Navy Special Forces have a number of guiding mottos:
- One is none - always have a backup (whether it's a gun, a helicopter or a plan).
- Everything that can go wrong will go wrong, and at the worst possible moment. Prepare for the unexpected. (Sound familiar?)
- The men must not only survive the plan, the plan must survive the blunders of men.
When we plan, we have a tendency to optimism – that things will go the way we planned. As many can testify, this is not always the case. Our word is becoming more complex, more information is available, and sudden disasters can upset things completely. As Field Marshall Helmuth von Moltke observed, “No battle plan ever survives first contact with the enemy.”
At this stage, people may ask, why bother to plan? The point is, we should expect things to happen and/or go wrong. Often, we’re planning with little time, information for a number of different scenarios. The key is to build in flexibility. This can be done in a number of ways:
Allow for things to change:
New information may come in as time passes, allowing us to change plans or re-direct efforts. We need to allow for this.
Expect Obstacles and Delays:
Plans are about general direction, not so much about the exact route to get there. Imagine you set off in your car to go somewhere and you encounter a traffic jam. If you can, you’ll turn off that road and go another way. You may reach your destination later, but you’ll still get there.
Build in Contingencies:
Accept you may need extra time/money/staff/equipment (or all four). Very few projects ever come in on time and on budget. If they do, what usually suffers is quality.
Planning for the worst means we can:
- Expect it;
- Deal with it;
- Overcome it.
As we gain experience in planning for the worst, it becomes “second nature”, easier to do and problems run less risk of escalating into crises.
I’ve 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 international financial services around the world running different operations and lending businesses, I started my own Consultancy to provide 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: Career, Crisis Management, Leadership, Productivity, Strategy
What Are You Planning?
I wonder how many of us planned for a pandemic that brought the global economy almost to a standstill. In the past, I’ve written about planning for epidemics, and feel that now is the time for us all to “dust off” anything we may have done in that past. Global pandemics will happen again. The question is, will governments react more quickly the next time, given the lessons learnt in 2020?
If we haven’t started allowing for something that forces us to:
- Close down our businesses temporarily
- Work from home for a period
- Practice social distancing and hygiene
Now is the time to think about it.
No business will have been left unscathed by the coronavirus pandemic. Anywhere that relies on people will have to think about safeguarding staff, premises and customers. For some businesses, depending on how they operate, some of this will come more easily than for others. Our own business had a number of strokes of luck in that:
- We operate in a small country that took the coronavirus seriously from the start;
- Our way of doing business lends itself to remote working;
- Our country experienced a very low incidence of infections thanks to the authorities’ prompt action and a population willing to comply with guidelines.
Not everyone else will be so lucky.
With luck, vaccines will be available in large numbers from mid-2021 which should get things going again. How will your business be affected?
I’ve 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 international financial services around the world running different operations and lending businesses, I started my own Consultancy to provide 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, Leadership, Strategy
