Building a Successful Business Strategy in Challenging Times
Women are Uniquely Well-Suited
This past year has caused more upheaval in all areas of life than most of us have ever seen before, but I can assure you that as women business leaders, we are uniquely well-suited to navigate our companies through times of uncertainty and achieve success in a landscape that is still changing (and will continue to change). By adding a data-driven, responsive business strategy to the strengths we are already bringing to the table, we can be confident that we are making the best possible decisions for the situations that will arise now and in the future.
Research by the Korn Ferry Institute shows that the women who have held CEO positions at Fortune 1000 companies often sought out a challenge for its own sake, forged their own unique paths to top positions, and were more aware that networking, collaboration, and hearing the suggestions and feedback from others was a crucial part of success.
Some of this willingness to listen to feedback – as opposed to trying to push a unilateral decision on others, can be because many women don’t feel their appointments are safe. We are afraid to rest on our laurels. This inspires many of us to take the initiative to listen to feedback, and then take that feedback to heart. Imagine the benefits every leader in every organization would gain from a mindset that they simply can’t afford to make a mistake.
You don’t want to go too far and become paranoid or overly averse to risk, but in a competitive economic climate, every leader, male or female, would do well to avoid becoming complacent.
In a similar way, the most useful business strategy will be one that can adapt and change in response to regular review and data analysis. (Keith Cunningham, the creator of the 4-Day MBA program, advises that informed, strategic business decisions should be based on real data, and not emotions or guesswork.) Strategizing is not an annual or special-occasion type of project; it needs to be part of your daily business operation. Sometimes an industry may change slowly, but sometimes a large disruption – including a pandemic – forces us to make wise decisions while navigating change.
A strong business strategy will help you avoid the three most common causes of business failure, according to Stephen Covey: undercapitalization, misunderstanding the market, or lack of a business plan. When combined with the strengths that women generally bring to leadership, this forms a powerful combination.
I would like to illustrate the potential of what we can achieve with an overview of how our colleagues in the craft spirits industry handled the coronavirus pandemic. While this was a very dramatic, fast-moving situation, the same lessons can be applied to the challenges faced in more ordinary years:
After a long period of sustained growth, craft spirit sales suffered a drastic setback, mostly due to the pandemic-related closure of tasting rooms and restaurants, competition from larger brands that could ship in bulk, and a reluctance of consumers to take a chance on new brands without sampling them first. In order to stay active, some distillers noted the shortages of hand sanitizer and decided to bottle their own, sometimes to sell and sometimes to donate to front-line workers. Before long, industry leaders networked and supported each other as they lobbied for favorable legislation, shared best practices, and tracked down raw ingredients that were suddenly in demand. Many brands were able to generate sales, increase brand recognition, and keep staff employed until their traditional venues began to open up again.
Mastering Your Skills
The women and men who led their brands through this challenge had to employ the skills women have traditionally mastered:
- Hearing feedback. When sales of their primary product slowed, the ones who knew which new direction to take were the ones paying attention to the demand for hand sanitizer that was suddenly surging.
- Networking. Understanding the new legal requirements and sourcing different ingredients all required having a strong relationship with other professionals in adjacent fields.
- Collaboration. Not only did the sharing of best practices help companies survive, but the community outreach of donating hand sanitizer helped grow brand loyalty.
These actions also helped the brands avoid the common causes of failure:
They avoided undercapitalization by knowing that you can’t be all things to all people. In general, your business strategy should be to start your product line with a smaller number of items, test them out, and analyze your data afterward. Then you can grow your product line out gradually and not waste capital on producing items that will not sell well. For many distillers, they had to preserve capital by narrowing their production to a single product in the short term.
To avoid misunderstanding the market, build a regular schedule of compiling and understanding your financial statements into your business plan. You will want to analyze your financial data over time to see how your product is actually doing. In our example, companies that took longer to acknowledge the sudden challenge they faced had less time to change course.
They revised their business plans when they needed to, instead of either ignoring the crisis or responding in a disorganized way. Simply deciding to bottle hand sanitizer was not enough; there were also regulatory, production, and community issues that had to be worked into the strategy.
Our experience with seeking out feedback, responding to change, and never becoming complacent in our positions can help us craft a business strategy that can meet any situation head-on.
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