Threat of new entrants for hotel
However, with expected changes in the business environment, businesses would have to assess whether their existing business model is sustainable in the long run.įor example, businesses which previously relied heavily on cheap foreign labour may find that post-Covid-19 crisis, there may be more stringent health checks and certification requirements. What is the new reality or next normal? No one knows for sure.
#Threat of new entrants for hotel drivers
They can work closely with the various business units to take stock of the business’ financial assumptions, determine key financial performance drivers and estimate the buffer or shortfall of capital needed when performing multiple scenarios planning. In this aspect, accountancy and finance professionals can play a key role in supporting their employers in the development of the crisis-action plans.
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Once the necessary move becomes highly likely, make the necessary investment to ensure that the business can act swiftly Stage 5 Determine trigger points to act when neededĭetermine a set of trigger points for when the business should begin detailed planning and execution for that move. To seek a balance between benefit and cost, businesses should develop strategic moves that will perform relatively well as a whole across all likely scenarios. On the other hand, a very flexible plan which allows for different scenarios may be too expensive and come to naught. In extreme uncertainty, a rigid plan would not work. Stage 4 Determine actions and strategic moves which would work across scenarios While it is challenging to determine whether such massive digital adoption would continue in the new reality, it would be useful to concur on the fundamental shifts and future themes before defining any initiatives. Overnight, people have massively stepped up their use of technologies that enable remote learning, working, services and consumption. One notable feature of the Covid-19 crisis is a radical shift to distance business models. Stage 3 Establish your posture and broad direction of travel Thereafter, assess the current slate of strategic initiatives against each scenario to determine whether each initiative should continue as planned, accelerate or stop. Identify the areas of business which would be most at risk and where it is most resilient, while estimating the buffer or shortfall of capital in the worst-case scenario. Stress-test your business’ performance and strategy against each scenario by modelling the various business outcomes. Stage 2 Develop multiple scenarios planning It would also be useful to perform a quick sensitivity analysis to assess which assumptions matter most. A three-year plan with the planning assumptions will help determine what drives the financial performance of the business. Take stock of the business’ financial assumptions, ongoing initiatives, and major strategic choices. Stage 1 Gain a realistic view of the starting point
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MCKINSEY STRATEGIC CRISIS-ACTION PLAN FRAMEWORK Using the McKinsey Strategic Crisis-Action Plan Framework as one possible guide, the team can develop a crisis-action plan by going through the following five stages across multiple time frames, ranging from the immediate to longer term after two years, to cope with the new reality. This is because as new information surfaces, it has to adjust and adapt its crisis-action plan accordingly. The team must be adaptable and be able to work with uncertainty. PLANNING AHEADĬonsulting firm McKinsey & Company advocates forming a “Plan-Ahead Team” which is made up of a few small but scalable planning groups. In this article, we explore how businesses can re-think assumptions regarding business practices, prepare themselves to bounce back stronger in the new business environment, and consider how their business and/or operating model would change given the new reality. One thing is for sure – businesses need to be very deliberate in planning for recovery. The best approach to navigate the Covid-19 crisis and subsequent recovery will differ according to the unique circumstances of each business.
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While businesses tackle the immediate challenges, those with an eye on the future as well will be the ones who can keep ahead of the competition. People will behave differently – they may still avoid crowds post-pandemic. Healthcare systems will be revamped or at the very least, improved, in many countries. When the dust finally settles on the coronavirus disease (Covid-19), the pandemic will leave behind an indelible mark in the history of mankind. PERRINE OH COMING BACK STRONGER POST-CRISIS