Five Areas to Consider as You Build Your COVID-19 Business Recovery Plan
We rarely receive advance notice that a disaster will strike. And even with lead time, every event has varied impact, effects and consequences.
That’s why it’s so important to have a process and framework for building a business recovery plan. In this article, we’re sharing five focus areas to help frame your thinking to develop your COVID-19 business recovery plan. While building and executing this plan will take intensive work, it has the potential to be a key driver for your business’ survival.
Define your view of your New Normal
As you set out to create your COVID-19 business recovery plan, you must first think about your “new normal.” Start by doing your research and defining how societal, industry, and consumer changes will impact your business. You should be reviewing this every couple of weeks with your team as you collect more information.
Think in 2-time frames
While the future may look uncertain, it’s important to use existing data and research to frame your thinking when building your recovery plan. You may have additional time frames to consider for your business but start simple by thinking about your plan pre-vaccine and post-vaccine.
First, look out over the next two to three months and outline a plan for operating while stay-at-home orders are lifted, and non-essential businesses begin to open their doors again. Take into consideration your plan for using your funding if you’ve received financial assistance for your business. Many considerations that go into your view will be conservatively held with a heightened focus on safety.
Second, look out further to when life will eventually return to more “normal” circumstances. Think through the aspects of your business that may be able to return to “normal,” and outline what will need to change. It’s important that you understand how changes in operations will impact your business model. And subsequently, that you have a plan for the aspects of your business that will not go back to the way they were. Here, identify whether the change is temporary or permanent so you can plan and allocate resources accordingly.
Identify adjustments to your business model
When thinking about making adjustments to your business model, there are two main factors to consider: revenue drivers and cost drivers.
First, consider your revenue drivers. These are the aspects of your business that create revenue streams such as your value proposition, customer segments served and your method for building customer relationships.
Next, consider your cost drivers. These are the things that create cost structure such as resources and materials, staff wages, and key partners needed.
By thinking through each one of these individually, you’ll identify several adjustments given your view of the new “normal.” We like to use the business model canvas created by Alexander Osterwalder and Yves Pigneur to assess and outline business model adjustments. This is a great framework for working through the various components of your revenue and cost structure and it adds structure to your thinking. We highly recommend you buy and read at least the first 45 pages of their book Business Model Generation in order to optimize this exercise, though you can participate regardless of whether you have read the book or not.
Think about investments to separate you from the pack
Given the current environment, what investments could you make to help separate your business from competitors? We encourage you to think like a contrarian in this regard. Consider how you may be able to invest in the following areas of your business:
- Capital expenditures
- Talent, both hiring great people and retaining your current team
- Inventory, by building your inventory and increasing production capabilities
- Customer retention
- Mergers, acquisitions and alliances.
Forecasting and managing the business cycle will help you determine the right time to make each investment.
Identify the what, who and when
Just like any planning exercise, recovery planning requires you bring clarity to your team and organization on what you’ll be doing. You’ll want to ensure that your team is aligned on the following priorities:
- What is it that must be done?
- Who is responsible for driving priorities?
- When does the task need to be completed and what is the time frame for getting it done?
Once you’ve aligned on priorities, you’ll want to set a series of progress review meetings to encourage accountability amongst your team.
Set Your Business Up for Survival and Success
A well-thought out and executed recovery plan can be the main driver for your business’ survival. Take the time to go through the exercise of creating your business recovery plan and gain peace of mind knowing you’re prepared to transition to your “new normal.”
Don’t hesitate to reach out with any questions you have about building your recovery plan, or if you need help facilitating your recovery plan more intensely. We’re here to help you succeed.