Article
Lessons Learnt: SME Continuity Checklist
23 Nov 2020
4 Min Read

This article will cover some of the things SMEs faced as a result of the Pandemic and the things one should be prepared for in the event another pandemic hits us again.


The unprecedented circumstances of COVID-19 have seen many businesses faced with challenges the likes of which they have never faced before. For many SMEs, having a trusted advisor that they can turn to for help and guidance through this crisis is incredibly important.


SMEs need to have a deep knowledge of their business and many of the specialist skills necessary to navigate through these most challenging of times.


Elements such as, cash reserves and the performance of the business prior to the COVID-19 outbreak need to be really understood before one can prepare for the new way of conducting business. In the early stages of the crisis, guidance was needed to understand the government grants, subsidies and how to draw them down remotely.


Many businesses now face a prolonged period of changing circumstances (i.e. the “next normal”) and continue to require assistance. There are professionals than can help effectively manage and reduce risk, explain how to take appropriate actions and fortify the business for the medium to long-term.


SMEs will need to address the following areas for current and continued business continuity:

 

  1. Health & Safety and Remote Working Norms
     
    • Provide staff with personal protective equipment if necessary
       
    • Manage productivity and availability expectations e.g. working schedules and socially distanced and regularly sanitised working environment
       
    • Explore the feasibility of remote operations including the impact to changes to systems and processes
       
    • Ensuring there are enough IT equipment for staff to work from home
       
    • Acknowledge than flexibility needs to be extended to allow for work life balance
       
    • Empathize with the challenges and issues of employees e.g. amending leave policies especially related to medical leave

 

  1. Leadership and Communication
     
    • Conduct frequent engagement activities- increase touch points to engage on non-work matters e.g. virtual social events and morale building activities
       
    • Inspire creativity, innovation and decision making at all levels
       
    • Be transparent about future operations and plans
       
    • Empower staff to give ideas on how the business can survive and thrive

 

  1. Strategic Direction
     
    • Develop or update business continuity plans and qualify the risk exposure and adjust accordingly
       
    • Determine which products or services are vital and focus on maximising volume and profitability
       
    • Review resource and manpower requirements to ensure than in the long run you have the ability to meet the demand post Covid-19
       
    • Review and new regulatory requirements set forth by the government
       
    • Check on extensions of filing deadlines for financial and tax reporting and at the same time ascertain if there are advantageous to early filing e.g. by doing so, it makes your company more eligible to government support and or refunds
       
    • Review the options and explore potential to pivot into new and different revenue opportunities or alternate markets- consider how to meet different needs and demands from changing customer behaviour
       
    • Explore new ways of conducting business and providing products /services to customer's
       
    • Relook into your structure and succession planning to take into consideration the potential pivot in business direction and overall offerings
       
    • Explore how best to maintain the services or products offered to customers in alternative ways without being seen to be opportunistic

 

  1. Identify Cost savings
     
    • Explore options to defer or renegotiate financial payments e.g. smaller instalments, payment discounts, lengthened payment terms
       
    • Explore payment deferrals offered by regulators
       
    • Reduce shareholder dividends if any
       
    • Identify opportunities to reduce cost further post covid e.g. reduce travel and entertainment budgets in the near term
       
    • Recycle, re-purpose or dispose of old/slow moving stock/inventory
       
    • Explore the possibility of sales under special conditions, in order to reduce the projected losses on inventories
       
    • Explore what grants/ subsidies/ loans are available and the eligibility requirements
       
    • Identify customers with large outstanding amounts and follow up – payment plans could be negotiated e.g. direct debits to pay off old balances (and collect new ones)
       
    • Consider what assets could be sold to raise cash
       
    • Reconsider or delay significant capital expenditure or investments

 

  1. Review Financial standing
     
    • Review all aspects of your current financial standing covering financial performance, position and cashflow and formulate a best- and worst-case scenario projected over the short to long term
       
    • Update cash flow forecasts regularly to reflect actual events and monitor ongoing cash positions
       
    • Address future cash shortages, for example, what expenses could be reduced, such as travel and marketing, which operations can be temporarily paused
       
    • Consider steps to increase cash coming into the business such as focusing more on product lines/ services that continue to sell well
       
    • Explore what grants/ subsidies/ loans are available and the eligibility requirements
       
    • Explore whether current insurance covers business interruption, financial losses, insolvency, income replacement, etc.

 
 

  1. Increase online presence
     
    • With customer's staying at home and shopping online, consider creating or increasing online presence to reach such customer's e.g. through a direct social media channels and other appropriate platforms
       
    • With online sales, consider how best to deliver the product or services to clients
       
    • Leverage on a variety of communication mechanism – mail, video, social media etc. but don’t neglect direct telephone contact for than personal touch
       
    • When adopting an online persona, it is imperative that the supporting software and hardware robust enough to meet the needs of the organisation, this will entail ensuring:
       
      • Cyber security measures are in place
         
      • Convenient Online payment facilities for customers to complete their transactions
         
      • Updated software with the optimum number of licences
         
      • Testing of bandwidth and VPN infrastructure to ensure peak performance of data access
         
      • Periodical backups are conducted coupled with the appropriate data integrity testing

 

Accurate and timely financial information is critical to understand how the business is performing and identify focus areas for immediate action. It is important to review the business strategy, plan and operational procedures to ensure that a holistic stance can be taken to address this significant unprecedented change.

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