External Forces Impacting Business Performance
Updated: Dec 20, 2022
In 2022, inflation has risen, with consumer prices up over 8% year-over-year. Increased production costs, staffing wages, labor shortages, and logistics and transportation costs have skyrocketed. Given the challenging external environment, we recommend these four tips to keep your business trajectory on the right path.
Provide value-added employee benefit programs
Wages are still essential when attracting and retaining top talent. However, the modern workforce seeks flexibility with the rise in remote and hybrid working, unlimited vacation packages, and other benefits aside from compensation. This transition is different from traditional working structures. Accordingly, companies seeking feedback from their applicant pools and employees can obtain critical data to draw insights into their personnel decisions and retention.
Develop alternate supply chains sources and solutions
Vendors and suppliers in your supply chain that historically deliver on time are now having issues. Depending on the geographic location of your sources, it could be advantageous to explore domestic or alternate offshore locations. More importantly, when seeking solutions to strengthen the supply chain, it is critical to consider the shipping, transportation, and logistical struggles. Overall, the goal is to meet the demand of your business and deliver on time. Losing profitable contracts is a way to go out of business.
Develop internal solutions
The easy answer is always to outsource critical functions. From outsourcing recruiting to a staffing agency, sales to an independent sales organization (ISO), or accounting to an external firm. However, when we develop the resources internally to combat the external forces, we have subject-matter experts readily available to pivot quickly in our business.
If you are struggling with attracting top talent, designate your "people person," allowing them to gather feedback, understand the job market, and ultimately take action to generate satisfactory results.
Communication: Internal and External; Up and Down; and Side to Side
We always mention communication as the key to success. Our current environment, which could be here to stay for the long term, requires multi-faceted communication.
Internally, if our leadership teams are not spreading messages from high-level meetings to enable the organizational mission to be carried out can be catastrophic. More importantly, these messages must flow from leaders across different levels to each team.
Externally, suppose we know of extended delays in the supply chain. In that case, we need to communicate with our customers and ensure proper planning and coordination for delivering products and services. Once again, leadership must pass this information to appropriate parties so customers are not left in the unknown.