Resilient businesses suffer client losses, drops in revenue and profit in line with everyone else.
What sets them apart is their ability to ‘bounce back’ quicker than their counterparts.
In 2009 after the financial crisis McKinsey did some research that suggested the earnings (EBITDA) of resilient businesses had risen 10 per cent whereas their market peer group, who were not as resilient, had lost nearly 15 per cent.
So, what is this thing called resiliency?
At its core it is the ability to rapidly adapt and respond to business disruptions, safeguard people and assets, while maintaining continuous business operations.
What practical steps can an advisory business take to ensure it has a better chin for the next punch?
Maximising your revenue opportunities
It’s great to be a specialist as long as your monoline revenue focus doesn’t expose you.
Why not be a specialist in a demographic sector or affinity group, rather than be a specialist in mortgages or protection only.
Create differentiation by choosing client segments and then do everything for them they could possibly think of, so that they refer you to others in your chosen customer demographic, at the same time as building your reputation in that market.
Fewer customers making more buying decisions with you will be more profitable than more customers making one buying decision.
Same product different delivery mechanism
The Terrace is a small chain of dining experience restaurants.
When lockdown hit, their business potentially could have collapsed. Instead they immediately switched to becoming the provider of quality picnics.
They saw that people still wanted to eat nice food they hadn’t prepared themselves and spotted an opportunity to serve the same food but delivered and packaged in a different way.
How could advisory businesses do the same? With the acceptance of technology as a means to communicate there are many new ways to deliver your expertise to customers.
Re-skilling you and your customer
If you do decide to broaden your customer proposition then you may well need to re-skill your staff.
One advisory firm took this a stage further and recognised that there was a way to reach into the pool of customers who were furloughed.
They offered ‘money training’ free of charge to these people, all of whom had the time to dial into one-hour slots on various issues from savings to mortgages through to protection and insurance.
As the market opens up, the rate of new client enquiries has risen dramatically. You guessed it, predominantly from the customers who were part of the training sessions. In re-skilling the advisers to use technology, the firm has secured a new wave of customers.
To enable your business to go the full 12 rounds you will have to train, think tactically about the fight and prepare yourself to be hit.
Ultimately, being able to take a blow and come back punching gives you a firm foundation from which to really become the undisputed champion.