At first glance, uncertainty and business planning would seem to be natural enemies.
It's true that with global uncertainty at an all-time high, businesses are finding it more difficult to commit to planning and strategy initiatives. But even though nothing is for sure these days, the implementation of carefully crafted business strategies is still the logical on-ramp to long-term business success.
To accommodate volatile markets and a constantly shifting global landscape, businesses need to take a tactical approach to planning and strategy implementation. The days when companies could depend on a baseline of stability are over; the businesses that survive will be the ones that are most capable of adapting their strategy to unexpected changes in the marketplace.
Developing a new strategy at the drop of a hat is complicated, but implementing that strategy in a short timeframe can be even more difficult – especially since the business environment could potentially experience a sudden shift before the new strategy has been fully implemented.
- Evaluate your risk environment. Uncertainty is a given in business. But that doesn't mean uncertainty is uniform. Different business environments are subject to different levels of risk and need to be evaluated accordingly. Conduct a thorough assessment of your risk environment, tailoring your strategy to accommodate the possibility of multiple outcomes in the context of your specific risk level.
- Assess previous planning processes. Previous planning processes can provide an indication of how well your strategies fare in the face of adversity. If previous strategy implementations demonstrated an ability to adapt to changing market conditions, then you're doing something right. Identify the strengths of your approach and stick with them.
- Plan for multiple scenarios. Clearly your business strategy should include contingencies for a worse case scenario. But it should also address scenarios for multiple levels of uncertainty and various events that can influence the implementation process.
- Incorporate fast response mechanisms. An effective business strategy should include fast response mechanisms during the implementation stage. Mechanisms that promote frequent monitoring, assessment, and strategy modifications are your best defense against uncertainty.
- Shorter planning timeframes. Business uncertainty doesn't appear to be going away anytime soon. If your current corporate culture calls for annual strategy reviews, you'll need to shorten your timeframes to incorporate quarterly or even monthly strategy reviews and restructuring initiatives.