What are the issues that really matter to your business?

Dr John Risk, Senior Lecturer and Programme Leader at  Warrington School of Management, University of Chester discusses the challenges faced by today's businesses and how to rise to them.

 

There is never an easy time to run a business, especially for people leading small to medium sized enterprises. The challenges are many and changing all the time; some are closer to your business and you have the time and knowledge to sort them out to survive, make a profit and grow. Meanwhile, external and international factors are impacting on your business, demanding response.

 

Few businesses are immune from global impact. Something happens unexpectedly across the world and the shock reverberates. Whether it is natural disasters or new competitors and ways of providing your product or service, conditions are changing.  This is what academics call “the business environment” which in the modern world is highly dynamic. These challenges for businesses of all sizes have to be addressed and anticipated so you can spot business opportunities and keep ahead of the threat of competition or substitution in the market.

There are certainly plenty of these challenges around. You need to know your market and your customers and where the industry is heading, competition is fierce. That alone keeps you on your toes but then there are all the factors more outside your control and uncertainty abounds.

Economic Challenges

 

Economic cycles rise and fall for varying lengths and time periods. The economic trends are currently on the up after four to five of the most difficult years for nearly a century, especially within the financial sector.   As recent problems and scandals have exposed, the banking system is still fragile. Interest rates remain low and the Bank of England’s forward guidance indicates that this will be so for a while. However, the necessary loans for investment (and in some cases survival) are still not properly feeding through to small businesses, who are seeking alternative solutions.  Maintaining investment in Research and Development and managing innovation are crucial to business growth, not just for global firms but also for many small to medium sized enterprises.

 

Closer to your business, cash flow is a perennial issue, with late payment of debt by customers, especially larger ones, a problematic concern.  You have taxation matters to address and all the regulations that surround your business and the Chancellor and Government seem always keen to change these as in the recent Autumn Statement and the Budget in the spring. More locally, there are business rates to consider, with a particular potentially negative impact for example for high street stores competing increasingly with out of town and on-line trade.  

Regulations (red tape) local, national and European will abound in your field and all this takes time and resources away from your key business priorities. Some regulations may seem well founded for example within health and safety; but with others, seemingly pointless detail takes over, grows and becomes an excessive burden for business.  Indeed, regulatory and legal issues and constraints are generally growing in the aftermath of the corporate governance problems of recent years.

  

 

Corporate Social Responsibility

 

Increasingly too businesses of all sizes wish or seem expected to show customers and stakeholders their ethical and environmental credentials. Some of this makes good business sense for example in reducing utility costs over energy and fuel usage and potentially improves the organisation’s image with the public. At best this can be a “win, win” for both business and good causes.

Infrastructure issues such as road condition, congestion and future transport development are vital to varying degrees. This is even before we consider the pros and cons of longer term issues such as the proposed HS2 rail development and all that means; not least to business and residents close to it but not necessarily feeling the full benefits.  There are more local business issues such as parking or Planning Development, Transport Plans, crime levels and access to local contract opportunities.

You need, through workforce development and training, to maintain and develop the skills and qualifications of both yourself and your workforce in order to have the skills to meet global challenges and changing markets. Education has a role in providing you with people with the aptitudes, skills and right attitudes for the workplace, and in developing and training your staff. With an increasingly knowledge based economy this is all the more crucial.  IT and information systems are changing all the time. Many industries are experiencing technological change of unprecedented proportion and a flexible and appropriately skilled workforce is essential. 

There is your own work life balance and trying to fit in family time, your own education requirements and training, as well day to day operational matters and strategic planning for your business. Not yet to mention your own long term financial concerns or pension provision.

 

Look Ahead

 

Before you start reaching for the blankets and pulling the bed covers over your head, in many ways all these issues challenge you to lift your head and look to the future direction of your business.

How far ahead you look and plan is a matter related to your own business and sector. Not many take the view of the likes of companies like Shell who look ahead 30 or more years given the long term nature of their markets, investments and projects. For you the timescale may be far more modest and relatively short term but still crucial. Whatever your planning horizons may be, market opportunities are changing.
 
In taking a strategic view, business organisations and networking opportunities through the likes of Warrington School of Management are a resource to be harnessed, helping you meet new customers and suppliers, develop new ideas and take a wider view. There are lessons to be learnt by keeping in touch with business networks and knowledge bases in anticipating the changes in your industry, market or sector and positioning your place in it for the future.



The team at Warrington School of Management

Dr John Risk is Senior Lecturer and Programme Leader at Warrington School of Management.

To find out more about us visit our website, email wsm@chester.ac.uk or follow us on Twitter