We're not living easy times economically speaking. Volatile markets, economic recession, companies that close, etc. are some of the situations we see and hear every day.
There's no clarity to see what's coming and there's a constant change in the rules of the game; this causes distress and confusion. This is the reason why there's the wrong idea that planning in these uncertain situations isn't useful and doesn't make any sense.
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Due to so much uncertainty, many times, business owners don't feel comfortable and think they can't make plans in these situations, and that's why they end up having extreme reactions: they paralyze and aren't able to make decisions, or, on the other hand, they make reckless decisions without analyzing them.
If you paralyze and don't make decisions, you're already making a decision: not acting. On the contrary, if you rush to make a decision without making an analysis, the probabilities of achieving the desired result are uncertain as to the economic context itself.
As we said before, we usually think that in situations like the current one it's impossible to make plans and that any attempt to do so will lead us to frustration. It must be emphasized that this idea is based on a traditional way of making plans: focusing on being able to anticipate, almost foresee, what will be the only possible scenario in which the company will work.
Here, we need to ask ourselves, how can we make plans in this context? Many planning processes are usually what limits you to making plans since they aren't flexible enough to allow you to make rapid decisions. In a world with constant changes, uncertainty is a key element you need to add to your planning; in general, this type of decision can't wait for a slow and rigid planning process.
“With this uncertainty, it's not necessary to plan; it's compulsory"
The planning process that includes uncertainty must contemplate several scenarios involving different contingency plans; in other words, you need to create short and long-term analysis models from the speculation about different variables that may affect your company. The more volatile the environment, the greater the need to have a wider range of possible scenarios; you need to prepare many contingent plans to be prepared for any situation.
In some uncertain situations, a strategic process made up of some basic guidelines can work better than other complex and detailed processes. This is why you need to take into account the following phases to carry them out:
One of the most important factors to take advantage of this process is hiring specialized employees for each task. You should keep in mind that successful planning should allow you to check all the levels and areas so that you all can learn from the uncertainty you face.
Today, companies apply new technologies and management tools that allow them to assimilate uncertainty easily and clearly. Some of them are visual models to identify variables, diagrams that show sensibility, and simulation programs that allow companies to understand the possible scenarios associated with their probabilities.
Finally, when contingency plans are developed you need to keep in mind the impact that possible threats can have in most critical scenarios.
Also, you have to take into account that in uncertain times, leaders are expected (more than ever) to show the path that employees have to follow, and the goals they need to achieve; threats have to be analyzed quickly and it's important you detect the opportunity in every crisis.
It's very difficult to make plans if the processes of a company are not well designed and don't work properly, since you can't make projections if you don't know how the company works and how it can react.
Do you think your processes are working well?