In uncertain times like Brexit, when the road ahead can be unclear, an entrepreneur's or business owner’s leadership skills are more important than ever.
You need to demonstrate to your employees, suppliers and customers that you can face up to the challenges and make the right, sometimes tough, decisions that ensure your business survives and thrives.
Martin Brown, CEO of SME business growth advisor, Elephants Child, is convinced the worst thing a business leader can do in turbulent times is do nothing: “There is a tendency for people to sit on their hands and wait to see how things turn out. If you do that, your competitors and the market will pass you by.”
He believes that, given the cycles of an economy, every business will go through obstacles like a recession sooner or later, and so its leaders should be prepared. Here are his five tips for riding out the turbulence to smoother times ahead.
1. Understand and assess the risk
First, assess the risk. Some advice can be gleaned from expert advisers but a good approach is to pull together a risk register. You should think about the potential risks, the likelihood that they will come into play, what their impact will be and what you would do to mitigate against them. Martin explains: "With something as simple as a risk register, you will develop a detailed understanding of what the risks are and what you can do about them."
2. Build a budgeted plan with contingencies for change
“For me, this is the most important one,” says Martin. “Having done your risk register and analysis, put your business plan together, make sure it is budgeted and that it is contingent so it can adapt if events take a different course.” Many of your competitors will do nothing and wait, he adds, but if you get your plan right and it’s robust and agile, you can steal a march on them.
By definition there will be many unknowns in a changing economic environment, so it’s vital to adapt your business model to best fit both the challenges and the opportunities that arise. Martin says: “Think about those retail brands that are entrenched in bricks and mortar and the traditional high street. The fact they haven’t been able to adapt to online consumer habits has really been to their detriment. And conversely, there are the success stories of those retailers that are making a go of it.”
4. Commit to your plan
Once you have a plan, by all means refine it where you need to, but roll it out. Martin adds: “In volatile times there is an irony in putting down a plan because things can change, but you do need to have a sense of direction to stay on track.”
Make sure you are communicating the plan and bringing the rest of the business with you, and that you are delivering the promises you have made to your team and to suppliers, customers and stakeholders.
5. Embrace it
As a business owner or leader your journey can be lonely and it can take you through a range of emotions. So, your ability to remain a positive leader through that process is a critical one. “That might include leaning on advisors. But it’s also about your knowledge of how you handle yourself in challenging situations, and remaining authentic,” says Martin.
It’s important to recognise how things can affect you, and that you have a way of managing it so you can remain positive as a leader. Martin says: “Part of being a good leader is being a stress umbrella – in other words, you take the impact of that and don’t necessarily share it with the people you lead."
The opinions expressed by third parties are their own are not necessarily shared by St. James’s Place Wealth Management.