Less Talk, More Action: Shaping SME’s Future Business Strategies
In a world full of disruptions, the foundation of high-performance and sustainability within your SME is a dynamic and down-to-earth approach to strategy.
I call it “strategy-as-you-go”, and it’s not a catchy buzzword: it’s a tangible, strategic readiness to respond and adapt to a changing environment.
Strategy-As-You-Go And Business Of Resilience
Despite unprecedented challenges over the past two years, SMEs in the UK have shown remarkable resilience. They have not only survived the pandemic and the difficulties in its wake but are thriving. Virtually overnight, new business models emerged, new products and services were developed, and more efficient ways of doing business were employed.
What’s their secret?
Though the hard work, motivation, and optimism of company leaders and their staff certainly played a part, it’s not the whole story.
Such transformation will almost always depend on the strength of a company’s day-to-day business processes, internal and external connections and how leaders use business data to drive decisions. When these factors are in place, it is easier to achieve the operational efficiency and agility needed to pivot into entirely new product lines and business models.
Put another way, strategy-as-you-go means two things: watchfulness and constant, deliberate movement. You keep your finger on the pulse of environmental change, then cull available resources to take the most appropriate action in response to that change.
While that may not seem like an earth-shattering insight, it is a strong message that less talk and more action should shape your SME’s business strategy. Strategic planning, for instance, within an SME is a necessary process. However, many founders and CEOs mistake putting their insight and project ideas on the proverbial back burner as they focus on the daily challenges of running a business.
A survey of 500 senior executives revealed that 90% of businesses don’t accomplish many of their quarterly and yearly business objectives; another recent study of small business owners pins the amount at 95%. The gap between strategic thinking and strategic execution is where SMEs tend to stumble.
It is time to take inspiration from the companies that have used all the disruption and downtime to their advantage. Regardless of industry, size, or business model, resilient SMEs follow many of the same strategies. Most notably, they treated business data as an asset, reorganised for operational efficiency, accelerated digitisation, and focused on innovation.
Four Steps To Strategy-As-You-Go
Let’s look at each of these steps in greater detail:
Step 1: Treating business data as an asset
Your business is generating a tremendous amount of data at any given moment. For instance:
- User/customer data. It includes online and in-store customer behaviour, customer profile information, as well as direct customer feedback.
- Financial data.It includes traditional financial reports, such as cash flow statements, sales reports, and income statements.
- Operational data.It includes inventory reports, employee performance reviews, workflow records, and error rates.
SMEs can leverage these data points to guide business decisions. You will start to view data as a proprietary asset when this happens. After all, no other business has the relationships and professional network you and your company do. Your business’ connection to your customers, suppliers, business partners, and other third parties can be a source of valuable insight.
Moreover, how your SME collects data and uses it is also proprietary. You can choose the data sets that will influence marketing, operations, and the customer experience and reveal opportunities for future growth and development. In the end, this practice can give your SME a real competitive advantage over the competition.
Step 2: Reorganising for operational efficiency and agility
This step aims to find an operating model that will allow you to scale the business quickly and efficiently up and down as needed and to build agility into your business plan to make such pivoting doable. Sometimes there may be several models running in tandem; for instance, you may have an online sales model and an in-person service or location.
A critical part of your operational efficiency involves staff management. Some areas to pay attention to include:
- Balancing remote and in-person work schedules.Ensure appropriate spaces and tools and an environment conducive to getting work done. Also, analyse the effectiveness and flexibility of your work scheduling.
- Evaluating current employee training and development.Includes knowing where to upskill existing staff instead of hiring additional workers or outsourcing and collaborating with another party.
- Considering the workflow.What processes happen frequently, and where do bottlenecks and errors occur? What areas are not getting the time and attention they need?
Step 3: Accelerating digitisation
To actualise the two previous points, you need to be equipped with the right tools. Today that means an assortment of digital and mobile equipment and software apps, either hosted in-house or in the cloud. Many of these solutions are also powered by AI to enhance speed and decision making. Of course, the world of business has been moving to digital for a while. Cloud-based solutions, mobile communications, and online sales have become the norm.
However, during the pandemic, over 50% of businesses increased their or their employees’ digital skills in response, and a half brought in new technologies. Everything from how small businesses interact with customers, take and deliver orders, process payments, interact with their teams and organise their business has been forced to go digital wherever possible. But keep in mind that digitisation is not a holy grail, and it is most valuable only when integrated with the right people and processes.
Step 4: Focusing on innovation
For SMEs, proprietary data on customers’ experiences, supplier engagement, staff contributions, and local business networks are potent sources of new opportunities for growth and development. When strategic agility and business resilience are priorities, these opportunities naturally become visible. However, the next step is making sure there are the processes and systems in place to act on this insight and monitor the results as they happen.
In short, strategy-as-you-go is not only the foundation of a healthy SME, but it is critical to serving your customers quality experiences. It will also help you maintain your competitive advantage– both now and into the future.