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Could your company be stranded on the hard shoulder?

Spare wheel in the boot? Breakdown membership? Mobile phone? Coat and first aid kit? Alternative routes? All measures you might take to help in the event of a problem on your car journey. What is unlikely is that you will have a second car with you. The reasons are obvious: cost, convenience and risk assessment.

How important is ‘business continuity’ for your business and therefore how much might you invest in contingency and protection? At one end of the spectrum some companies do have a ‘second car’. Call centres, data centres and trading floors are examples of facilities that some large organisations have on stand-by in the event of failure of their primary facility.

At the other end of the spectrum many businesses have no plans and have made little or no effort to protect themselves. Does this matter?

Thinking ahead

The easiest way to start an assessment is to ask yourself, “What would happen if….?” The scenarios can vary from IT failure, physical loss of office space, the loss of a key supplier or customer, resignation of critical team members, your own availability to the business, or failure to protect intellectual property or other assets.

The second part of the assessment is to review the costs of putting contingency or risk mitigation measures in place. Some of these are quick to do and incur little cost. Examples include writing business processes so that others can step in to do key roles in the event the primary role holder is unavailable, identifying alternative suppliers of key products and services and ensuring that functions that require specialist skills, such as IT, are supported by appropriate partners and not covered in-house by less capable people.

The extent you go to in identifying contingency measures will depend on the likelihood of a problem – which is sometimes difficult to assess – and the cost of the contingency. You might not buy a ‘back-up vehicle’ but having one available and ‘on-call’ can still be a cash drain.

What you should do

For the owners of small businesses, the pragmatic steps we recommend are:

  1. Focus on prevention. Have a session with your team to think through the ‘what ifs’ in your business and identify easy, quick measures.
  2. Recognise what quick steps you would take to recover if something does go wrong.
  3. Ensure you have good business processes that are up to date and documented.
  4. Look at the potential for back-up and spare capacity. For businesses that are heavily IT dependent (who isn’t…?) this is obvious, but look across your business for other areas where simple and inexpensive measures would be effective.
  5. Finally make sure you are appropriately insured. Insurance itself may not prevent a problem but will ease and speed your recovery.

Drive on!

To complete your business journey, you don’t need a spare car but some pragmatic plans and spares in the boot. Contact us and we can talk you through the route ahead and even help by providing a co-driver.

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Testimonials

We have talked to other business owners and they are taken aback that we forecast our revenues, costs and cash flow

Meret Maynard
Outspoken Projects

Downloads

We’ve written a number of guides on selected business subjects that will set you and your business in good stead for whatever future you may choose.

These are free for you to download and to make use of in your business, so please help yourself.