When operating a business, we often find ourselves living “within” the organization on a daily basis, and we can sometimes forget to look “outside” to see what external events could have an impact on our operations or even the viability of our business.
There are always going to be circumstances that are beyond our control that can have direct or indirect impacts on a business. While it is nearly impossible to predict every potential scenario, it is crucial to think about some of the “what if’s” and develop strategies to prepare for any situation.
This is what is called contingency planning. Contingency planning can take on many elements of a business from sales and marketing to financing and operations. It is a process that can help a business or organization properly prepare for a variety of outcomes so that they can respond efficiently to an unplanned event.
There are a lot of ways that a business can help prepare for potential crisis. Take look at your business and think of any external forces that could affect your operation. You can do this by:
- Checking the media for trends or events
- Keeping an eye on your competition
- Brainstorming some potential crisis situations
- Monitoring for new technologies or funding opportunities
A simple methodology for proper contingency planning is to look at segments of your business independently and to focus on one element at a time.
Some examples could be:
- Sales: Are there any new rules or regulations on soliciting business that are being talked about in the media?
- Finances: Are there any new financial instruments available in the future, changes in interest rates?
- Operations: Are there any emerging technologies or changes that could be implemented for efficiencies?
Once you have come up with some potential scenarios, think about what you would do in the event that change is implemented and come up with a plan. We may not be able to catch every potential change, but if we stop and take a look outside, we can often see issues that may be coming our way. This is contingency planning and is a great tool to keep on top of external factors.
For more information on all the services offered by the Halton Region Small Business Centre, please visit our website http://www.haltonsmallbusiness.ca.