How to Restructure Your Business to Increase Profits During the Pandemic?
Given the amount of unprecedented changes that the world has experienced in 2020 a lot of firms are forced to change, they are forced into some sort of transformation whether they like it or not and along with that comes restructuring more often. Many companies during the pandemic recognized that they weren’t built for any kind of pandemic situation or some sort of economic shock that came along with it such as employee disruption and other circumstances. Now lots of companies are waiting for the dust to settle and are planning to restructure the business to get back on track. In this section we will discuss how to restructure your business to increase profits during the pandemic.
Before going further let us take a look at the situations when a company needs restructuring
- When the actual profit is less than the anticipated profit.
- When the company faces bankruptcy or increase in bank overdrafts.
- When resources are not used up to their full potential.
- Frequent turnover of employees.
- When the market evolves.
- Increasing debts
- When the company still uses the traditional methods and structure of management.
- When unpredictable regulatory changes take place.
What are the steps required for better business restructuring?
1. Assessing your current situation:
The first thing to do when the dust settles is to step back and assess your current situation, look at the financial results, financial impact of where you are as an organization and the operational impact and the strength and weaknesses of the operational activities, look at the present strategy and its strength and weaknesses, and make changes in that strategy if required. Look at the technology and tools you have, ensure that you have the right organization, right people etc. these are the things you must assess about the current situation. Dive deep and evaluate every detail. So that you can get the idea of changes that you will have to make in the business.
2. Assess your business vision:
The next step is to assess the business vision. Revisit your future vision and analyze whether it is still the same, and do you still have the same strategy and objectives that once you had, analyze the new challenges, the things that were before versus the things now, the new opportunities and strengths must be considered. It is very important to reassess the vision and have internal alignment to get on the same page with where you are going and how you are going to continue with what you did well. The core part is to assess whether the past control measures are applicable in the present scenario.
3. Define your current business processes:
After completing the first two steps, the next thing you must do is to take a look at your operating system and overall business processes and observe which activities are working and which are not, identify the bottleneck areas and the challenges you face, also detect the processes that never existed in your business before but you may need it now, understand the current inventory of the business and the requirements, former processes may not be applicable in the present scenario, so to establish the new set of processes identify the opportunities and work according to it. If the “ends” change then the “means” to achieve them also changes.
4. Define your business process improvements:
Once you have taken the inventory of your current state business processes, it’s important to look into the future and what does your future state need to look like, what would you like to have your business processes look like even if you don’t have the right people or the right technologies to do that yet. For that you must focus on making your processes more efficient and flexible to accommodate things that may change in future. The processes must also be established from an opportunistic perspective so that the business processes will not only solve the problems but also provide new opportunities to get ahead of the curve.
5. Plan strict supervision:
After adopting the above steps you must continuously and rigorously monitor the financial and operational activities to ensure that the result of the restructuring process is positive and the results are satisfactory. Through continuous monitoring you can detect any threats or loop holes if there are any.
6. Get help from experts:
Always try to approach the experts to get advice to restructure your business to increase profits. Try to consult professionals so that they can provide you with best choices and strategies that may be applicable to your business. Appointing a professional for the restructuring process will provide you with a bunch of benefits as they know every detail regarding the changes in business environment and they may formulate the accurate steps that are required.
Restructuring your business is an intimidating process still it plays an important role when your firm doesn’t fulfill your expectations. But if you conduct business restructuring and re-organize things then it may help you to earn profits as expected. For example let us consider a manufacturing company which was facing low demand of the products which they normally produced during this pandemic, due to the low demand they were not earning adequate profits to even survive. They later decided to restructure the business and planned to introduce new product which was in fact a hectic decision, but still with the help of experts and professionals they followed all the required steps such as assessing the situation, gathering the resources, eliminating the activities which were not required etc. and they introduced the product in the market. After some time they experienced the improvement in the business which helped to survive as well as regain the demand. This is how you can practically observe the improvements that will occur due to the restructuring of your business. This is just a hypothetical situation, but in reality you may experience more benefits after organizational restructuring, which will not only impact the financial growth but also increase the availability of opportunities and more choices.
Also Read: Why Your Business Needs Financial Restructuring?
How can CDA help you in restructuring your business?
CDA is equipped with a team of experts and professionals who are experienced in dealing with all kinds of financial and accounting challenges. CDA provides customer tailored services to its clientele to overcome the problems they face. We provide financial restructuring, organizational restructuring, external and internal audit services and many more quality services to help their clients to carry out their business smoothly. CDA’s personalized approach is always prepared and ready to render services wherever and whenever it is needed.