A SWOT analysis cover four key factors, Strengths, Weaknesses, Opportunities and Threats. Threats are factors that can affect your business and are influenced by factors not within your control. Hence, it is important to acknowledge these outside threats and prepare accordingly for this. These threats may even be industry specific and affect your business but not affect other businesses.

Effect of threats on Businesses

Take for example the current pandemic. Online based business-like ecommerce companies and essential commodities are facing less hinderance due to the situation. Some of them are also seeing an increase or growth in business, especially in case of ecommerce businesses, where there is an increase in online sales. This can be seen in how Italy, where online sales between February and March 2020 grew significantly compared to the same period in 2019, registering a 90% growth on March 8^th compared to the same period in the previous year. Amazon in US is currently working to hire more individuals to keep up with demand and maintain its supply chain.

A similar example can be seen within UAE too where a local online based start up doubled its business during a global economic crisis. The business saw a 60% rise in revenue since the start of the pandemic in the country in February. Business in other industries like retail, entertainment and fitness however are facing issues due to closures.

Mitigation

These threats are sometimes unforeseen and can impact the running of your business and the economy as a whole drastically. It is important to plan in advance and then act swiftly once the issue arises to ensure no further or irrevocable harm is caused. For this it is important to have a business continuity plan in place.

Business Continuity Planning

Business continuity planning is the process of creating systems of prevention and recovery to deal with potential threats to a company. With an addition to prevention, the goal is to enable ongoing operations before and during execution of disaster recovery. To develop a solid Business Continuity Plan the following steps need to be taken:

• Business Impact Analysis: Identify functions and related resources that are time sensitive. The Impact Analysis can be hypothetically done based on certain economic assumptions, e.g. Disruption in source of supply, disruption in logistics, new regulations relating to product usage, etc.
• Recovery: Identify and implement steps to recover critical business functions. Recovery goes hand in hand with the Impact Analysis – when you have a fairly documented Impact Analysis – Recovery Planning will also be thought through at that stage E.g. Alternate Sources of supplies, Stocking Patterns when you see global cues around you, Alternate channels of supply, etc.
• Organization: Creating a continuity team who will devise a plan to manage the disruption. Identifying the team who can be driven to perform during disruption, crisis managers and teams to execute with least impact on the operations.
• Training: The team needs to be trained and tested. When you have a Business Continuity Plan in place, the identified critical team can be adequately trained to handle any kind of contingencies.

The company should test the Business Continuity Plan to ensure that it can be applied to many different risk scenarios. This will help in identifying weaknesses in the plan and can be corrected accordingly. Having such a plan ensures you are better prepared in the future if such an event were to repeat itself.

These plans can be created for a variety of scenarios and do not need to be limited to the current pandemic in particular.

Implementation

We can already see various businesses re-working their current business models to cope with the current scenario. Retail businesses are either promoting their current online channels, or are developing online channels. Certain fitness institutions are encouraging social distancing by offering their classes and services through video conference sessions using applications like Zoom or Microsoft Teams. Women’s World of Boxing, a New York based female owned boxing gym and global fitness club Barry’s Bootcamp have applied the above solutions to tackle the current scenario.

Some of these new avenues can be created to not just be a temporary solution but a new revenue and service vertical for the business itself. In India after the demonetization of the local currency the countries reliance on digital wallets and payment methods increased with small general stores also adopting digital wallets to make up the decrease and unavailability of physical money in the economy. These steps taken are still maintained with people still opting to use these digital methods over traditional ones.

Centurion Consulting LLC is a team of highly experienced individuals who can help create a Business Continuity Plan specifically for your business and industry to not just tackle the current scenario but also better prepare you for any future threats that may arise.