Restructuring an SME in a pandemic

Getting your strategy right

For an SME to take steps towards adapting after a significant external shock, it first has to reflect on what has happened. To be clear, this is not so much about understanding the event, it is about understanding the effect of what has happened and is happening to the organisation. To that extent the senior leadership has to understand that asking the organisation to change can be met by resistance.

Human beings are by nature emotional creatures and consequently this emotion flows into the organisation as a whole. Therefore it is reasonable to expect that some SMEs across the UK followed Rosenbaum et al. (2018) change curve, (Figure 1). From a UK perspective, Payne and Cookson (2020) noted that the UK was maintaining business as usual activity as late as early March. With cases rising quickly, the UK government and the country as a whole demonstrated a clear period of what Rosenbaum et al. (2018) referred to as denial and anger which subsequently gave way to a depression within the world economy.

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However true to the change curve, SMEs across the UK are now seeking innovative ways out of recession. It is now the challenge of SMEs across the UK to re-find their relevance to the market and customer base through adapting existing and creating new products or services.

Without doubt when there is a significant external shock to an organisation, it should be expected that both the supply-side and customer-side will be impacted too. Therefore when there is a great shock a behavioural change should be expected. The behavioural change can emerge in many ways, however some of the most common circumstances could be:

1. Relevance to the customer is halted.
E.G. the wedding and hotel industry where events of scale are not possible. 

2. Suppliers are unable to provide goods or services to clients.
E.G. B2B postal advertising communications as decision makers work from home. 

3. The market supply and demand balance is significantly changed. 
E.G. supplying the events sector with infrastructure for large scale exhibitions.

What we’ve seen with SMEs across the UK and the world during the Covid pandemic is a collapse of order books overnight. Order books dropped due to investor confidence, lockdowns or worse a significant long term shift in market demand. What we do know about significant external shocks is that:

1. External shocks speed up looming market changes.
2. Business decisions need to be made quicker. 

 Consequently as SMEs across the UK find themselves emerging from Covid, there is now an imminent need to source funding, re-organise and re-purpose. This is where VP Consulting can prove invaluable to an SME as:

1. We help SMEs access alternative funding sources and grants that do not have the same limitations as banks.
2. At this time it is likely that your organisation will need to review its strategy, VP Consulting will support your journey through:a. Reviewing new objectives
b. Matching objectives to funding required
c. Identifying staff required to meet the anticipated objectives
d. Resetting expectation across the organisation.

Let us help get your team onboard

 

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Further reading

Kübler-Ross, E., 1969. On Death and Dying. Scribner. 

Payne, S., Cookson, C., 2020. Boris Johnson shook hands ‘continuously’ despite science panel warnings [WWW Document]. URL https://www.ft.com/content/91c8b10f-7e76-4686-8d53-35b2af0c1a2e (accessed 5.8.20). 

Rosenbaum, D., More, E., Steane, P., 2018. Planned organisational change management: Forward to the past? An exploratory literature review. J. Organ. Change Manag. 31, 286–303. https://doi.org/10.1108/JOCM-06-2015-0089