The key to success will be to remain agile and adaptive.
This is especially true in a year that’s already been marred by sporadic outbreaks and lockdowns across the country.
Agility will set your business up to respond rapidly and flexibly to changes, including announcements of snap lockdowns — like the “billion-dollar lockdown” we saw in Melbourne this February. The lockdowns, in addition to changing travel regulations, border controls and vaccination rollouts, mean remaining flexible is the key to success.
Last year, we saw many organisations move to company-wide remote working with very little notice. While some had remote working procedures or business continuity plans in place, it was still an unprecedented and monumental task. While most of our clients did well in the face of this adversity, those that really excelled had a few things in common:
- A business model that could adapt to the change
- Strategic thinkers who could understand how to continue to service their customers given the changed environment
- Collaborative technology in programs such as Microsoft Teams, Google Hangouts and Zoom, with a workforce that were trained to use them
- Business continuity procedures
Innovation will also remain a key ingredient to success, as businesses that succeed will seek to stand out from their competitors.
Last year saw many businesses pivot to products and services needed in response to the pandemic, products that were in demand, or new opportunities that better suited supply-chain limitations.
Some of these organisations want to keep capitalising on their new-found success and innovate further to improve their new products. Others should recognise the importance of innovating, especially given the speed at which digitisation and automation sped up over the course of the pandemic.
This is where the Research and Development Tax Incentive (RDTI) can help. Prior to the 2020–21 budget, the industry had been lobbying against proposed amendments to the incentive that would have reduced the RDTI by $1.8 billion over four years. This didn’t go ahead. Instead, the government announced small improvements to the scheme in last year’s budget, including an increase of the R&D expenditure threshold from $100 million to $150 million per annum, meaning those businesses that improve the intensity of their research and development are the biggest winners. Innovation is key.
It might sound obvious, but another key to success is planning and setting the goals that you want to achieve. This could mean a tweak or a complete revamp of your current plan.
At William Buck, we ask our clients to consider what has worked for their business in 2020 then distinguish between what was temporary and related to survival in 2020 and what will continue to produce results into the future.
Regardless of what’s in your plan, the act of planning itself is critical. Take some time out to strategise, set SMART — Specific, Measurable, Attainable, Relevant, Time-based — goals, consider current conditions as well as what could happen in the medium to longer term, remember that cash flow is key, and even account for your exit plan. Having an end goal in mind will enable you to check whether your current strategy aligns with that goal and whether it’s achievable at all.
It’s advisable to develop a people strategy in your planning this year, depending, of course, on your business. A volatile 2020 resulted in new remote working procedures, employee wellbeing programs, and for many, a reduction in hours and pay. Consider how you can prioritise your people, ensure their mental and physical wellbeing while at the same time positioning your business for success.
Technology played a major role in business continuity last year, and it’s likely these technologies will have a long-lasting impact.
Contactless payments, improved work collaboration tools, telehealth tech and connected or “IoT” devices are just some of the technology trends that were sped up in terms of readiness and widely adopted during the pandemic.
Not only will these continue to boost efficiencies in a post-COVID-19 world, their preservation will improve the readiness of business in the event of another lockdown or economic crisis.
Social media has also had a significant impact on customer behaviour. With a few Facebook posts and some stress about COVID cases, you can drive people straight to the supermarkets to seek out key products — take #ToiletPaperGate, for example!
Government incentives and stimulus
With the government’s stimulus superstar, JobKeeper, set to end later this month, it’s time to look at the remaining incentives to boost cash flow and take advantage of tax breaks if you’re still in a less-than-ideal position. For example, the federal government’s SME Guarantee Scheme will be available for loans made by participating lenders until the end of the financial year and guarantees 50 pe cent of loans up to $250k for eligible businesses. Temporary full expensing rules are still in place, providing eligible businesses with an immediate deduction for the full cost of eligible depreciating assets. And JobMaker will free up $100–$200 in cash per week for eligible businesses if they hire qualifying young jobseekers.
The federal government’s business website, www.business.gov.au, has links to many of the federal and state government support measures and is a good place to start when you’re weighing up your options and assessing eligibility.
While this isn’t an exhaustive list of measures to foolproof your business from another downturn, it’s certainly a start.
Scott Harrington, director, William Buck