What can small and medium enterprises do not only to cope, but emerge successful after a global crisis?
The Coronavirus pandemic has brought about the worst period of global economic uncertainty in decades. And in such difficult times, cutting down on operation costs is often a necessary evil. This need is even greater for smaller companies who do not enjoy the same resources and fallbacks as big organizations. To keep afloat during this crisis—and to succeed afterwards—, SMEs must thoroughly reassess and optimize your key assets.
Even without access to a team of data scientists or high-end analytics software, small organizations can still future proof their business with the following asset optimization strategies:
Remain grounded and informed
No matter how successful your business becomes, it is imperative that you regularly step back and check for any areas for improvement.
Every business will have its weak points, no matter how big or small. In times of uncertainty, it is especially important to account for these and address them as soon as possible. “Weak points” are not just damaged assets; they could also be underdeveloped areas in your business. Perhaps you have an asset network within your business but are unaware of its impact or value. You might have plans for optimizing your key assets in the long-term, but these are outdated, misplaced, or suboptimal.
Whatever the case, now is the perfect time to re-examine and update your business. During this coronavirus lockdown, many of us are fortunate to retain access to the internet, social media, and other telecommunication services. These are indispensable tools that can help you identify key assets, their various vulnerabilities, and your subsequent optimization options. The best part about this is that almost all these online resources and services are free or very inexpensive.
But just as you are on the lookout for your ship’s blind spots, it is important to also stay sharp when researching online. Avoid misinformation by limiting your searches only to reliable and credible sources. In some cases, the government, or other similar, reputable institutions provide these resources, such as the UK government’s free advice line. You can also consult with your peers, or refer to valid online reviews. Remember: credible information are always verifiable.
Continue to smartly manage risk
Economic uncertainty can, understandably, make SMEs more risk averse, but these complications are not always avoidable, especially when times are hard. Navigating the uncertain landscape, therefore, requires the smart management and coordination of risks.
Reducing long-term operational costs sometimes require large, but short-term investment. This strategy elevates a company’s upfront capital expenditure, but depending on your individual situation, the cost may be well worth it. For example, enlisting an asset management consultant to assist with tough investment decisions is a considerable expense. However, these experts will be able to tell you whether investing in optimizing a specific asset is still a profitable venture or if may end up costing you greatly in the long run, thereby saving you thousands down the line.
One way you can rationalize this dilemma is by looking at it as the price of keeping your business afloat not only during these difficult times, but in the aftermath as well. With the right tools, you will avoid making suboptimal and costly asset management decisions.
It all depends on what you learned from evaluating your business.
Receiving “satisfactory advice” is an extremely subjective concept. Some decision-makers may find it difficult to learn that their businesses require immediate investments to consolidate long term savings. Other business leaders may shy away from the idea of having to contract an asset management consultant to simply relay a need to remain with the status quo.
The truth is, there is utility in all advice. Realizing that your assets are already optimized is still useful information that can allow you to manage your business infrastructure more smartly and conservatively, as well as carefully balance your capital and operational expenditures.
Convert existing knowledge into insights
All organizations amass data and information that can become critical asset management insights, and SMEs have various ports of call to achieve this. Data can be pooled from various departments or key people in the organization, and can include quantifiable metrics like performance trackers and periodic costs breakdowns.
Harnessing data and converting them into actionable insights can be a resource-intensive endeavor, but an equally well-paying investment. Not all organizations have the option and resources to call upon asset management specialists. Fortunately, technology has made data analytics more accessible, and although this is not always a replacement for expert analysis, it can still significantly improve your operations—even on a budget.
One approach to minimize in-house analysis costs is to begin with a top-down strategy and to focus on easy wins. Breaking down monthly operational costs into granular subcategories may reveal layers of patterns. Operational costs may be skewed, for example, towards a group of departments that share certain operational characteristics. The right tools will not only show you these findings in simple terms, but they will also help visualize where there are inefficiencies in your system and easily point you to what steps you will need to take.
Identifying the inefficiencies in your operations is the first crucial step in optimizing your assets amid these difficult times. The next step now is to develop strong asset management solutions, tailor-fitted to your unique situation. Learn more how companies can navigate uncertainties particularly associated with the COVID-19 pandemic, and how you can digitize and future-proof yourself from this extensive report by Arcadis and Arcadis Gen.