Business leaders must become guardians of resilience

Guy Armstrong at Oracle argues that business leaders need to balance day to day firefighting with longer term attention to resiliency

 

A storm is brewing for business leaders. With the hope that we were coming out of the bleak times of the pandemic and moving into a brighter 2023, businesses find themselves facing the next major challenge all too soon – an incoming recession due by the end of the year.

 

Leaders who succeed will be those who balance day-to-day firefighting and staying afloat with investments to shore up their resiliency. That means supporting your people to use the masses of data available to make more informed decisions, more efficiently. With disruption and market uncertainty becoming the new normal, building business resiliency will be vital.

 

The real-world ingredients of business resilience

When McKinsey sought to define the true meaning of a resilient company during the last economic downturn, it analysed 1,100 publicly traded organisations and discovered that only 10% were ‘materially better’ than the crowd.

 

These resilient businesses had three aspects in common that ensured business continuity: empowerment of the finance function, proactive scenario planning, and opening up business potential whilst ensuring adequate cash flow.

 

Unlocking previously siloed data is central to driving success in these areas. Immediately accessible and relevant data helps business leaders to shape real-world strategic direction and share different values and perspectives across their organisation. It allows finance teams to test against a wide range of potential scenarios, striking the fine balance between historical (GAAP) analysis and in-depth evaluation of likely future disruption.

 

Gaining the full picture makes these organisations more agile, allowing them to manage cash flow and investments backed by real-time data and analytics.

 

It isn’t necessarily about looking at large transformational projects in periods of economic uncertainty, but looking at smaller changes that still make a large impact. As McKinsey advises, start small, start simple, and start now. It can be as simple as digitising your expense system and moving it to the cloud, or integrating a level of automation into your data analysis.

 

These are by no means trivial or inconsequential, but they are projects that can be done quickly, easily, and that have a profound impact on the way that your business operates.

 

Gaining wider business visibility, maintaining an accurate balance sheet, and unlocking new revenue streams will be vital as we move into this period of recession – and the enabler will be access to, and effective use of, data.

 

Get the full picture

Clear, actionable data visibility goes hand-in-hand with better business resilience. But this means more than staying afloat. Building better data visibility empowers the whole business to make proactive decisions and better investments.

 

For leaders to be able to balance data and human insight across the business, they should ask themselves some important questions. These might include asking how rapidly and cohesively your business can respond to fast-moving events, and what you can do to help empower your workforce to stay focused and motivated during challenging times.

 

You won’t have all the answers, but gaining a clear and extensive view across the enterprise will go a long way to solving these challenges. This will allow business leaders to dig deeper into more meaningful and relevant insights, identifying quick wins that will reinforce longer-term plans and goals.

 

Organisations need flexible cloud-based systems that can bring all data together and create a single source of truth. Enterprise resource planning (ERP) solutions incorporate financials and accounting, projects, HR, customer experience and supply chain data, fuelling connected planning and advanced analytics.

 

This integrated data can inform risk analysis, predictive forecasting, and scenario planning. It also opens the door for automation, identifying actionable insights to tackle ever-evolving challenges at pace. This is especially important for those navigating supply chain disruption, with visibility proving essential for effective planning and routing. If a “just-in-time supply chain” fails, your business is severely challenged.

 

The fine balance of efficiency and growth

In times of economic crisis, it’s more important than ever for business leaders to provide strategies that will increase efficiency. Business leaders must be able to predict, test and unlock new revenue streams, whilst maintaining an accurate balance sheet to back procurement decisions.

 

Increasingly, finance teams will play a vital role in supporting the implementation of continuity strategy throughout the back-office – using finance data to directly support at a business-process level, monitor cash flow, and ensure internal auditing. A combination of ERP technology, automation and human innovation will make the finance team more resilient and agile, and the benefits will extend throughout the organisation.

 

Balancing new external impacts whilst boosting efficiency, performance and purpose will be vital to see through this recession. By looking for ways to increase efficiency, it becomes even more important to be aware of performance, and these elements need to be balanced very carefully.

 

Even as leaders look to the future – making processes more streamlined, faster and simpler, it is imperative that performance is a regular checkpoint.

 

A cloud-based ERP platform that incorporates data from all functions of the business enables greater interconnectivity and visibility, allowing leaders to keep track of both efficiency and progress.

 

Add in artificial intelligence (AI) to automate processes and machine learning (ML) to filter broader datasets for predictive planning and forecasting, and leaders can spend more time building resiliency strategy, and less time analysing data.

 

Particularly now moving into a recession, it is not always about big, sweeping changes. It’s about looking at your business and understanding what you can practically do to meet current challenges and ensure success for the future.

 

Unlocking the power of your data will be essential to survive this recession and make your organisation more resilient to disruption going forward. 

 

---

 

Guy Armstrong is Senior Vice President of Applications, Oracle UK and Ireland

 

Main image courtesy of iStockPhoto.com