Vince brings more than two decades of experience to his clients, with expertise in Human Capital, Employee Benefits, Organizational Strategy, Private Equity and M&A
Now that we are heading into 2023, executives are implementing business plans that were formulated during the latter half of 2022. For most, questions linger about the relevancy of these plans. We had plans for 2020 until the coronavirus took hold, effectively shutting down the global economy. We had plans for 2021 until the Delta variant took hold. At the same time, businesses had to compete with the Federal government’s extended unemployment benefit in order to fill the vast amount of open job positions. We had plans for 2022 until inflation hit which drove wages and interest rates skyward. To further complicate things, we have started seeing mass layoffs beginning with Amazon dumping 10,000 employees in November of 2022. Now we have stagflation, a worker shortage, lingering supply chain issues and mass layoffs. How is this muddled economic stew even possible?
Executives need to take recent history to heart knowing that under normal circumstances planning is an arduous process, but in this economy it is even more unpredictable. As you implement this year’s plan there are three factors that will be critical. These factors apply whether you believe we are sinking into a deeper recession or that there are calmer waters ahead.
1. Historic Integration – If you haven’t already done so, revisit your current plan to synthesize previously mentioned problems from the last three years and how they might affect you in 2023. As an example, if you are experiencing a shallow pool of available talent then plan on finding a previously untapped talent pool to alleviate potential future worker shortages.
2. Contingency Plans– Do you have a Plan B (and C and D) when things do not go according to plan? For example, what if the Fed raises interest rates too high which slams the brakes on the economy and slashes demand for your product? This could result in a slowdown in production after giving your employees a 6% wage increase last year. In light of all that’s happened in the last three years, create scenarios that are not part of your current plan, but could happen based on the factors that most impact your business.
3. Core Values – Do your plans (primary and contingencies) reflect your values? Core values should permeate business planning at every level, but they are often forgotten during times of uncertainty. For instance, if caring for employees is a core value how are you communicating potential layoffs due to demand reduction or mandatory overtime due to a worker shortage? Regardless of the unexpected problems that arise this year be sure to pivot in a manner that permeates your organization’s core values.
‘The only constant is change’ and ‘an ounce of preparation equals a pound of cure’ are two old common sense adages from previous generations. They have never been more applicable than they are right now. Integrating the major issues from the past three years into this year’s plan is key. Allowing for contingencies and making sure your core values are consistent in each scenario is paramount. These are three great ways to be prepared for all that might happen in 2023.