Prepare your business for potential collisions — or pay price

Hey there, time traveller!
This article was published 05/10/2024 (378 days ago), so information in it may no longer be current.

Fall means football to me, and is my favourite time of the year. While many people refer to football as a contact sport, I believe it is also a collision sport.

Fortunately, the science and quality of equipment used to protect players is always improving. So, too, is the training and development of players and overall team preparation.

However, factors out of your control, such as the physical characteristics of the competition, adverse field condition and plain bad luck, can impact your on-field success. It is the sudden and unexpected nature of collisions that cause the damage.

There is certainly a similarity between football and business.

While leading companies create annual plans to guide activities to achieve business objectives, unexpected collisions can occur.

For example: financial (sudden bankruptcy of a key supplier), personnel (wildcat strike), competition (merger of two main competitors, creating a super competitor) or natural disaster (a volcano in Iceland causing havoc with airline flights worldwide), to name a few.

Leading companies prepare for these collisions through training, planning and ongoing monitoring of key factors affecting their business and overall operating climate. While the suddenness of a collision is always jarring, having a plan on how to react is the answer.

Therefore, a key question to consider in an annual planning exercise is how to prepare your business for business collisions. The following process provides a foundation you can build upon, depending on the level of complexity in your business.

First, know the source of potential collisions.

The concept of scenario planning is one approach to consider. Begin by looking at substantive “what if” events that could significantly and immediately disrupt your business. Determine the likelihood of the worst case scenario and then rank the possibilities so you know the top three or five.

Second, determine a strategy for how you will handle each potential collision.

Every leading company has a core strategy it operates within. This strategy should be driven by the concept of avoiding collisions or, at least, minimizing damage. Who wants to face a sudden and unexpected business incident that can cause irreparable harm to your company?

As a follow-up to the identification of the various scenarios in Step 1, if you are unable to avoid the collision, you must determine how you want to respond to each of the scenarios identified to limit the damage.

You may choose to adjust your existing strategy or you may be confident it can carry you through the situation. If you believe a new strategy is required in response, then you need to prepare it. This includes ensuring an understanding of the overall impact on your business and the total response that would be required. You should also consider if the cure is worse than the collision.

Prioritize these responses, because not every one could occur and the collision damage should be estimated and/or anticipated.

Third, collision responses need to include an implementation plan, with specific tactics to absorb what you can and change what is necessary.

Execution is the key. Develop specific action plans that you will deploy in case a collision occurs based on the specific scenarios and the response strategies you developed in Step 2. Your detailed implementation tactics describe who will be responsible for specific tasks according to a pre-set time line.

Preparing employees and developing tactics can be achieved through training programs and mock disaster planning sessions to see where gaps may exist in the initial response. When you know how you will respond to certain collisions, you can confidently keep moving forward throughout the event.

As famed German philosopher Arthur Schopenhauer said: “Talent hits a target no one else can hit; genius hits a target no one else can see.”

Adopting this mindset may help you minimize the damage from a potential business collision or avoid it altogether. This is how champions play the game.

Tim’s bits: There is an old business adage: “Failure to prepare is preparing to fail.” While things “might” happen to impact your business, you are better served to consider these possibilities and prepare a response in your winning game plan so the potential collision and impact on your business is minimized at worst or eliminated at best.

Tim Kist is a certified management consultant, authorized by law, and a Fellow of the Institute of Certified Management Consultants of Manitoba.

tim@tk3consulting.ca