How can small and medium enterprises overcome uncertainty
and still sustain growth? Is it possible to scale in the face of and ever
changing business environment? Two questions (both interlinked in some way)
which rankles every entrepreneur, start-up, family group and SME. The answer is
not simple but neither is the problem insurmountably complex.
Companies and entrepreneurs have to understand that he
starting point to solving this challenge is actually in accepting it. Though it
might sound like something from a psychiatry manual, the reality is many
companies do not recognize the enormity of the problem they are up against.
SMEs which are the grass-roots innovators and last mile socio-economic value
creators have struggled to adapt to change and in many cases have faded into
oblivion or inconsequence. So how do companies face this conundrum?
The answer can be devised through a three-stage framework to
ensure sustainability in the long run.
(Acknowledge
the sources of images that have been downloaded from the internet. Any
copyrighted image used is unintentional and regretted)
Strategic Vision –
Agile Execution
As a consultant we keep talking about strategy, long term
vision, planning and implementation. In a fast changing world, planning for 5
years and sticking to a well-laid out implementation plan itself can be a
recipe for disaster. Given the pace of change, what looked rosy at the outset
might actually vanish as an opportunity two years down the line making the 5
year plan redundant. One of the hallmarks of a small firm is being nimble. If
the process of vision implementation leads to rigidity of purpose then the
basic advantage of a small firm is destroyed.
The Solution
Define your vision but keep the execution dynamic. Instead
of working on one activity that spans a long time frame work on multiple
smaller activities that follow each other. This way the effort, time and costs
associated with vision implementation is managed, the ability to change is
higher and in the face of a game-changing disruption, the ability to reengineer
is not lost. The key to this lies in the following two points that are talked
about.
Human Capital
Development
People are the backbone of any organization, more so in the
case of a small enterprise. Many companies pride themselves on having people
that have been with them for ages and have grown with the firm. This is great
from a business continuity perspective but (unless managed well) could be
detrimental from a change management perspective. Employees in smaller enterprises
and start-ups are highly empowered as they don multiple hats and have a greater
visibility across the operational lifecycle. Being in the firm for a long time
or working towards a single goal could lead to tunnel vision. The ability to
embrace change and anticipate disruption is hampered.
The Solution
Empower your people and continuously challenge them.
Leverage your key employees to help create new ideas, foster innovation and
drive change. The agile implementation framework spoken of earlier, will keep
them challenged and their ability to see the result of their efforts (discussed
next in this article) will provide a sense of intellectual satisfaction. In
short, participative change and management will have to be practiced.
Digital
Transformation
This is probably the least understood, misunderstood and
most underestimated of the needs to make an enterprise future ready. When you
talk of digital transformation it is surely not about big data, fancy software
and high-tech control rooms. Digital transformation is the process of making
your data (any enterprise data) work for you. It is about how you collect,
store, analyse and utilize your data. Most companies have an ERP of some kind
and some form of CRM. But do decision-makers have continuous real-time visibility
of changes to the data, evolution of the metrics or coming red-flags? Does your
data help you with operational decision-making? Can your data be used to
simulate scenarios? Do you need someone to interpret your data for you or is it
visually self-explanatory? Answering these questions is the basis for digital
transformation.
The Solution
Ensure that your data is accurate, real-time and well linked
up with the long term goals and short-term KPIs. Use real-time dashboards
(rendered on your mobiles, tabs or laptops) to continuously stay abreast of the
organizational events. Empower your key staff by letting them track progress of
the company in general and initiatives in particular so that they can visually
see the results of their action. This also ensures that as an enterprise you
stay nimble and are able to react quicker to any changes.
These three elements are interconnected pieces of the same
puzzle and one does not work without the other. But in unison they would ensure
that an organization is well prepared to meet the future. Neither of these
requires any massive reengineering or commitment. There will be some investment
involved though, but what will be the key is a change of mind-set across the
firm to embrace and face change rather than be unprepared and worried.
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