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Uncertainty can be a concern for every business, but it’s also a concern for your competitors. Can you make it your competitive advantage?
It's said that when nothing is sure, everything is possible. But a growing range of increasingly interconnected global pressures means uncertainty is becoming more of a constant than an exceptional state in business.
While risk entails ‘known knowns’, where the spectrum of scenarios can be mapped out even if their probability can’t always be easily forecast, uncertainty relates to circumstances that many would not have predicted in their most outlandish imaginings.
Crystal balls and cappuccinos
But while a crystal ball remains frustratingly elusive, companies that take the right steps to protect themselves and prepare as best they can for the unexpected can help shockproof themselves.
It’s even been said that the greatest potential for profitability lies in uncertainty: after all, many of us queuing up for a daily £3 cappuccino would have years ago dismissed such a purchase as inconceivable. Threats to businesses from uncertainty can be complex and from a variety of sources, but there are solutions that can give you that competitive edge.
Provide a positive experience in a negative environment
How do you handle changes in your sector, and evolving consumer expectations? Human nature’s fondness for the path of least resistance dictates that a strategy of increasing convenience for customers is a bet offering strong odds.
The explosion in online retail, for example, has tapped into this and an increasingly time-poor society, leaving in its wake a trail of high-profile names unable to compete.
In 2015, more than 80 per cent of the UK population aged 16 to 74 made an online purchase. Any retailer with a physical presence needs to ensure it factors digital in its business plan, as a threat, or opportunity, or even both.
However, perhaps reassuringly, research has shown that multi-channel retailers are experiencing stronger online sales growth than those operating in just one stream.
The right to click
John Lewis, with over 30 retail outlets and nudging confidently towards its first century in business, is a prime example of a traditional bricks-and-mortar retailer embracing digital. They’ve invested large amounts of capital into this part of its business, offering features likes its ‘Click & collect’ service.
The retailer shows just how much digital has become an integral part of daily life, with internet access cited by some as a right on a par with water and electricity. With firms of all sectors now hiring developers to nurture and grow their digital development, you simply can’t afford not to keep pace to maintain your brand relevance.
Innovation is not a department
Innovation is of utmost importance to compete. In the motoring sector, for example, industry giants are pursuing hefty investment in electric and driverless cars, showing robust confidence in a technology that still requires a crucial leap of faith from the general public. Will they catch newcomers such as Tesla, Apple, Google and Faraday Future? Time, and sales, will tell.
Additionally, the financial crisis led to a real sea change in sentiment towards traditional banks, leaving the floor open for new entrants to take market share. Many of these challengers have prioritised a more attentive and personalised customer-service experience, and come with the added bonus of being unburdened by the legacy issues and negative perceptions affecting many incumbents.
A calm sea never made a skilled sailor
Burnt by the manifold and unpredictable consequences of the financial crisis, it’s understandable for firms to be terrified into inaction, for example postponing investment in the absence of the reassurance and reliability financial indicators once provided.
But planning for a comprehensive range of scenarios — a list that doesn’t need to be exhaustive but does include the more extreme ends of the spectrum — gives you the opportunity not just to prepare tangible plans of action, but really nail down your company’s mindset regarding how it would like to behave and be perceived in such circumstances.
Preparation is the stage at which you can determine attitude, with flexibility and openness to change among the most valuable assets, and ensure you have the means in place to communicate with the rest of your business.
Smaller companies will perhaps find it easier to involve their whole management team and even the whole organisation with any decided strategy, and be nimbler to act.
Larger firms will be able to draw on a broader range of viewpoints and experiences of handling difficult experiences, and potentially tap into a larger pool of resources.
Additionally, research has found that providing staff with some training on how to better make predictions, helping shake off preconceptions that can alter the interpretation of information, for example, can make a tangible improvement that can translate into increased company longevity and resilience.
One area that has grown in risk is cybersecurity, and experts have advised that it is now highly advisable, especially in the light of data-leak scandals, to prioritise this part of your business as much as, say, legal functions.
And just as the attitude of management is key, so too is maintaining great relationships with customers and suppliers. Their support and trust that you have fostered can guide you through uncertain times, while regular conversations with those buying your product will stop you committing the fatal mistake of losing touch, and may even provide you with signposts to forthcoming trends.
Stick or twist: deciding when to play your hand
In business, uncertainty has become one of precious few certainties. You can turn what could be a threat into a real advantage by harnessing your organisation’s strengths, catalysing your brand and revenue to well and truly break away from the pack.
One thing’s for sure, when change is affecting your business, it’s affecting your competitors as well. What they’re doing might give you some clues but don’t always assume it’s the route you too must follow.
As Steve Jobs once rightly said, ‘Don’t let the noise of other’s opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition’.
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