Recent years have seen an increase in freelance work across the country. But eventually, even successful freelancers run into earning limitations. They are continually exchanging time for money. At some point, you can only juggle so many projects and clients at the same time.
So if you’re a freelance designer, for instance, you might decide to start a sign-making business. You buy an engraving machine and other supplies. Then the pandemic hits. Businesses around you close shop indefinitely; the demand for signage drops.
This scenario, and countless others like it, have been unfolding everywhere. And the effects are unevenly felt. Big businesses are insulated, to an extent, from recession. Small-to-medium enterprises (SMEs) that depend on them have a smaller margin for error.
These SMEs include cafes, cleaning, and other businesses in the service sector. As with the example of the freelancer-turned-entrepreneur, they might not yet have paid off their startup costs. In this uncertain climate, how can you lead an SME through further disruption?
Using feedback
Despite the general gloom surrounding our economy in recent months, there have been many stories of SMEs that have successfully navigated these challenges. Bicycle repair stores shifted focus to selling e-bikes; ice cream shops entered partnerships with groceries. Both ended up thriving.
A signage business might find its opportunities creating public safety signs rather than retail store displays. Those in the food business can turn to online delivery. Cleaning enterprises could explore automation and sell disinfecting robots or UV light systems.
There are many ways for an SME to pivot, but these tend to seem self-evident only in hindsight. When you’re in the middle of a crisis, how do you figure out how to shift gears?
Organizations of any size are learning that feedback is critical to survival amid disruption. And if there’s one thing that technology has consistently improved upon over the years, it’s information-gathering. The internet isn’t just full of news and ideas; more than ever, it’s possible to get the information you need at instant speed from the people who matter most.
We have a plethora of options to capture the voice of current and potential consumers, from email surveys to social media. Use this feedback. Listen to fellow business owners, leaders, and mentors. The information you gain will help shape your decision on how to move forward.
Working with people
Change and innovation are informed by feedback, but the actual steps taken must involve the human element. Your people are vital to making this work.
Even though many businesses are finding it necessary to furlough workers, those that have managed to pivot during the pandemic successfully are leveraging the creativity and engagement of employees. This is particularly relevant to SMEs. Without access to the same level of resources as large companies, an SME can’t easily invest in new technologies to overcome challenges.
However, this issue of scale can become an advantage when it comes to harnessing the potential of your team. In a traditional large-scale organization, the individual employee plays a bit-part role. Their voice is seldom heard and even less utilized to effect change. They lack autonomy and tend to be disengaged from their work.
SMEs can turn this around by embracing the startup mentality and treating their employees as real stakeholders in the future success of the company. Using agile principles, you can frequently check in with your team but keep the pace brisk. Spend less time on meetings and planning, and emphasize individual action and testing to make swift, high-quality decisions.
Sticking to core competencies
We don’t know how long it will take to approach something resembling normalcy, or to what degree that restoration is even possible. And it’s anyone’s guess as to how long the interim will last or what else might happen during that time.
If practices such as constant sterilization of surfaces and minimizing contact through automation are mandatory in the future, it could effectively raise the cost of doing business in many industries. You have to recognize that short-term solutions might end up becoming permanent business practices.
Throughout this process of challenge and response, the businesses that succeed are the ones that manage to stay true to their core competencies. History is full of companies that have survived through centuries, often by undergoing remarkable adaptations. Nintendo, for instance, is world-famous for their video games, but they were founded in 1889 as a maker of playing cards.
You can reimagine your products and services, shift your business model online, or pivot to a different concept altogether. But you have to think long-term and continue to deliver value using the things that give you a competitive edge.