Well the same advice applies to companies weathering the economic storm we face today. I gathered some helpful tips on preparing for hurricanes and the similarities are striking. In addition, the actions taken during the storm can position you for a move favorable recovery afterwards.
The bolded planning steps come from the National Hurricane Center, but I adapted them for companies facing our present economic situation:
Before and During the Storm
Discuss what hazards you might face
- Companies must be prepared for changes in the economic environment. Developing a plan for good and bad times will allow your firm to be better prepared than your competition.
- Companies must realize where they have particular strengths—market position, access to capital, a pipeline of talent. These all can be viewed as safe areas upon which to rely.
- Sometimes companies must change direction in order to survive. Downsizing workers, eliminating expenses, and focusing on core markets may be necessary.
- Having outside resources can provide support and expertise not available inside a company. Experts can provide solutions to the unique issues faced by a firm and to improve operations.
- Communicate, communicate, and communicate. This goes for shareholders, customers, vendors, and employees. Getting these interested parties to support and understand your needs and actions during challenging times will increase the chance of survival.
- Risk management on contracts, lending arrangements, future commitments, and ways to support the business after the storm must be evaluated.
- Human capital will get companies through tough economic conditions. Determining the right talent that must be retained in a time where layoffs may be required is critical. While the “war for talent” might be on hiatus, talent management should not be ignored. The remaining employees must be acknowledged as your greatest asset, but they can be damaged if left unsupported in this environment. Innovations and new product development in anticipation of the end of the storm also are never more important.
- Training and development focused on the right areas still must occur. Assessing your employees and developing their skills will position your company for any future adversity or opportunity. Succession planning remains a critical function during an economic downturn.
After the Storm
Avoid dangerous conditions
- Make ROI a priority. Examine business processes, cost structures, and organizational issues and use this information to improve. Lean on experts to provide ideas and resources. At the same time business instincts and judgment are essential at this phase.
- Gauge your financial strength, market opportunity, and talent. Reexamine your resources. Now is the time to focus on total rewards and talent management. Employee benefits saving opportunities should be exploited.
- Hire selectively. While hiring for need is often the default, companies should entertain adding more rounded “athletes” to provide the most flexibility.
- Communicate, communicate, communicate. Tell all the same constituents of your latest plans, direction, and goals. Reengaging and retaining shareholders, customers, employees, and vendors will require focus.
- Make decisions—and quickly. The biggest mistake is to wait for the perfect moment to act. At some point hunkering down no longer works, and companies run the risk of never cleaning up from the storm.
- Seize new business opportunities. Look for new markets, new products, and areas where competition was irreparably damaged by the economic hardships. The sales force must aggressively attack the market—give them the tools and support to win business.
