Navigating out of the storm - this intensive course aimed at team leaders of all levels will guide you through a review of the impact of the crisis on your whole business - or key areas - and successfully emerging from it.
It is being widely predicted that the Covid 19 crisis will herald a new global restructuring of the economic order. Capital Economics have estimated that the world will suffer a 15% drop in output whilst other research groups have suggested the figure could be as high as 20%. The prospect of a deep global recession is extremely acute with the evaporation of global trade and consumer spending. There is no doubt that we are facing un-precedented times.
A recent survey by the Office of National Statistics (ONS) found that over 50% of UK businesses only have enough cash to last six months! Debt has become a lifeline, as sales have collapsed. High levels of borrowing could also end up sinking many companies. City UK, a financial lobby group, estimates that small to medium sized businesses will emerge from the crisis with some £105bn of additional debt!
Well before the current crisis, the business models of many companies were either in difficulty or failing. Beales, Carluccio’s, Carphone Warehouse, Debenhams, Flybe, Hertz, Laura Ashley and Virgin Atlantic are just a few that have demonstrated poor organisational and financial resilience. So, as other companies navigate out of the Covid-19 storm many will fail or sail perilously close to failure.
Regardless of the gloom and pessimism we know the business world will survive and move forward. The winning companies of the future will be those populated by leaders who responded to the future, rather than the past. This is a time for abandoning the known and looking to the unknown – it’s a time for powerful conversations!
The crisis provides enormous opportunities to rethink customer value propositions and business models. We know that within weeks of the crisis starting, companies were abandoning underlying assumptions that they had relied upon for decades. Businesses swiftly circumvented long-term resistance to home working. Long standing internal silos and functional barriers were discarded within weeks. Small businesses moved rapidly to new online delivery channels and models of working. Universities and business schools that zealously clung to traditional classroom learning moved overnight to Zoom lectures. Many businesses stepped up to offer innovative customer value propositions in rapid time. Large and complex businesses enabled their teams of technical experts to collaborate across industrial and market sectors to design and develop new and much needed ventilators for hospitals in record times.
Realising the learning and insights from the crisis to create a new and more agile organisation can only be delivered if leadership teams have the right mindset and behaviours. As ever it will be a combination of hard and soft thinking that will deliver lasting outcomes.
The crisis is already destroying many business models and, in some cases, posing an existential threat to entire industries! So, do you elect to adopt the classic strategy of retrenchment and focus on strong cost and asset containment that reduces your rate of cash burn? An approach that many companies are now taking as a means of survival! Or, do you look to radical opportunities to deconstruct and reshape your business model whilst at the same time exercising prudent and well-judged financial disciplines? In such unique times, the easy option is to simply cut costs, but in the longer term you run a real risk of developing organisational inertia and obsolescence. Our stimulating and challenging three-day programme advocates harnessing the benefits of “creative destruction” with a strong financial compass to help navigate a future course.
We aim to provide a highly interactive roadmap to help your teams identify and navigate their learnings and accelerate out of the crisis.
In the years ahead having a strong cash management position will become a critical sign of financial and organisational resilience. For many companies, profitability will have to take a back seat for the near future. In recent times, having a strong cash balance has often been a source of corporate embarrassment. Why can’t you use the cash for better things? What’s wrong with your leadership ambition that you have so much cash? However, in a post Covid world, cash on the Balance Sheet will no longer be seen as a sign of leadership complacency or inefficiency.
Financial resilience will also be based on ‘operational’ gearing rather than the traditional ‘debt gearing’ of
recent decades. Future winning organisations will major on ‘cost effectiveness’ rather than cost reduction. Indeed, avoiding the knee jerk reaction of “slash and burn” will be critical to navigating the medium and long-term path to success. A focus on the strength of the Balance Sheet and the ‘quality’ of cash will be mandatory – new Bond issues, fresh revolving credit facilities (RCF) etc will all
be easier to access in a low interest economy. At the same time there will be a new focus on “operational’ cash’ from trading rather than simply borrowing it! Raising fresh equity rather than increasing the debt pile will be another key strategic discussion point for business leaders.
We don't have any currently scheduled dates for this course but we can customise it to your requirements and deliver it on an in-house basis for any number of your staff or colleagues.
Contact our in-house training expert Aleksandra Beer to discuss your requirements: