Business owner’s guide to the new normal
Bounce Forward
What is your most pressing priority right now?
Fundamental priorities of every small business owner
Some priorities are timeless. Our circumstances dictate the lens we view them with. And our ability to be flexible and timely adapt to those circumstances decide how far we go about accomplishing these fundamental priorities. Across all business environments, there are five fundamental principles of running a small business.
No matter how close you are to your business, there are certain variables out of your control, such as a global health crisis. Managing shifting priorities can be a challenge – you’re forced to make unprecedented decisions and the learning curve is steep. Here are some priorities that you will relate to in the new normal world.
Priorities in the time of a pandemic
From the onset of the coronavirus pandemic businesses have reported having reduced their active employment by
This e-book will guide you through the process of assessing your business priorities and provide actionable insights to bring them to fruition. Take the self-assessment to help you get started planning your next steps. The corresponding check list will help you prioritize which actions to focus on first.
How to use this e-book
Priority #1
Growing your business
Priority #2
Leading your business through tough times
Priority #3
Cultivating a culture of inclusion and diversity
Exiting your business successfully
Commit to Your Strategy
Commit to your strategy
Priority #5
When everything feels like a priority
Take the self-assessment test now
What is your most pressing priority?
Growing your business Leading your business through tough times Cultivating a culture of inclusion and diversity Exiting your business successfully When everything feels like a priority
Growing your business as an owner
Guiding your business as a leader
Creating a diverse and inclusive culture
Building value in your company
Developing an exit strategy
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Controlling costs and short staffing
Managing unforeseen roadblocks as impact of change before you reopen your business
Navigating health and safety concerns for a safe return to work
Supporting and preparing employees, vendors and families through this time
Let us examine the business priorities born out of the pandemic within the context of long-term and fundamental business priorities, to learn how to keep moving forward with greater confidence even when the future seems less certain.
on average.
39%
www.livingconfidently.com
Sources
1. https://www.pnas.org/content/117/30/17656
Brought to you by The Guardian Network ©2021. The Guardian Life Insurance Company of America®, New York, NY. PUB11047(01/21) 2021-114279 (Exp. 01/23)
In the throes of uncertain times, small business owners are being compelled to re-evaluate their business priorities. Whether you have recently launched your first business, are preparing to retire, or anywhere in between, as your business evolves, so do your priorities. And, in an uncertain world our lives, businesses and future are changing even more rapidly.
Finding your way forward
Expanding your business, vertically or horizontally, and driving volume and revenue is the most pressing priority for most new business owners. For seasoned business owners it is often to grow their business beyond where it is today.
Get the most out of every dollar in your business
You know your business and understand how cash flow struggles are among the most common challenges faced by business owners. Today, with restrictions on how almost every kind of business can operate, evaluating your cash flow is more important than ever. While you can’t control what happens in the world that may affect your cash flow, you can be proactive by making sure that you’re getting the most out of every dollar you spend on your business. Putting protection in place through the right kind of insurance is one of the most cost-effective things you can spend your money on. That can mean…
You already know some of the best ways to attract and retain staff, like competitive salaries and great leadership, but there are less obvious ways to compensate and incentivize employees, too. Now, more than ever employees value flexibility in their work schedule as work-life balance has taken on an entirely new meaning in a pandemic world. Outside of compensation, creating opportunities for advancement and a culture of mentoring can make holding on to talent easier. Get creative with recognition, like offering unique experiences. Be sure to plan for it in your cash flow. Also make it a priority to give thanks and praise to members of your team. A personal call or skype, walk by if in person, and handwritten notes can help with morale boost and create an attractive culture.
Attract new hires and retain talent
of small business owners experienced an event that could have led to an insurance claim in 2016.
• Keeping a reserve of cash available
• Making sure that your business has the right insurance coverage to transfer risk
• Securing a line of credit (before you need it)
• Establishing the right operating agreement
35%
Growing Your Business
The coronavirus pandemic has made all business owners, new or seasoned, question every assumption about your business, including cash flow. Could you withstand a few poor quarters if the economy sputters? Where could you trim expenses without fundamentally hurting the business?
• Or all of the above, depending on your particular business and circumstances.
Successful business owners prioritize protection. Using cost effective insurance to transfer risk and liability is one is one of the most overlooked components of a successful business strategy but remains a crucial one. A basic business owner policy will cover things like liability protection — which protects your assets if your employees, products or services cause harm to a third party — property insurance or worker’s compensation. More comprehensive or specialized plans can include things like protection against data breaches or professional liability (the failure to provide or properly render professional services). Review your business plan often and keep it up to date.
Protect your business against liability
When your business isn’t publicly held, there’s no easy way to know how much it’s actually worth, but a valuation can be important for everything from insurance coverage to retirement planning. You work hard for your success and part of that (but not all of it) is the monetary value of your business. To learn the value of your business, you can enlist a financial professional to undertake an impartial valuation. They can help examine your business, choose an appropriate valuation model and leave you better prepared to plan for both your future and the future of your business. Don’t wait, having a business valuation is especially important if the unexpected happens.
Get an impartial business valuation
Cash is the lifeblood of your business.
Take the self-assessment now or read on about how to lead your business through tough times.
Bounce Forward - Overview
Managing its flow is critical to helping your business achieve and maintain success for many years to come.
2. https://www.insureon.com/blog/small-business-insurance-claim-statistics
As a leader and business owner, you are navigating new and ever-changing priorities with limited time to react. We have entered a new reality that we can’t wish away. We can only prepare for it. Some small shifts in your approach can go a long way toward boosting your effectiveness.
Confront reality
Getting ahead of the curve means taking a long, hard look at what the future might hold. Despite the many challenges of re-opening with heightened safety measures, some businesses have not only survived but thrived during COVID-19. They took action, such as:
Staying focused on culture, people, and values is more important than ever. A healthy business enjoys an inclusive, respectful, and symbiotic culture. Many CEOs stress the importance of a strong culture saying it helped them in hard times and how important it is not to sacrifice that culture when a company comes under pressure. Listen and respond to the emotional and business needs of your employees. But do not become too inward looking either. Build trust, value diversity and build inclusive spaces with all your stakeholders – employees, vendors, suppliers and customers.
Build and protect your culture
• Pivoting from mainly bricks-and-mortar to a more virtual business • Implementing appropriate safety measures to ensure employees and customers are protected and comfortable • Re-training employees so they have the skills needed for success in a post-pandemic environment • Restructuring capital and making investments in future business growth • Reviewing operating costs and deploying technology to improve efficiency • Determining compliance with federal and state laws to mitigate liability risk • Updating recruiting and staffing strategies to be more diverse, inclusive and equitable
Openness builds respect, trust, and solidarity, all of which in turn help employees stay focused on the task of running the business at a time when financial rewards might be limited and the future uncertain. That being said, many of your employees will still be under stress for various underlying reasons. Prioritize the mental health of employees and communicate with them more than ever.
Be transparent with employees and support their needs
The difficulty of looking to the future while concentrating on a challenging present is not lost on anyone. Your ability to remain forward looking despite the near-term pressures your businesses might be facing will determine your future success in the new normal. Work towards ensuring that your business emerges on the other side with a competitive advantage by setting the course for higher productivity, acquiring a footprint in a new market, or not losing a talent or reputation in pursuit of lower costs. Work with a scalpel instead of an axe, to protect the future of your business.
Keep faith with the future
Take the self-assessment now or read on about cultivating a culture of inclusion and diversity.
As the economy slowly reopens, review this return to work checklist for employers to ensure smooth transition for your employees back to work.
Businesses committed to a diverse workforce may find it easier and faster to emerge from the pandemic than those dragging their feet on D&I. 56% business owners agree that creating an environment that supports I&D is a priority. Diverse employees build greater engagement, knowledge and experience sharing and resilience. Here is how you can continue to build a culture of diversity and inclusiveness even when your business is in survival mode.
Update your hiring practices
The Covid-19 pandemic and economic uncertainties have taken a disproportionate toll on BIPOC communities in the United States. Business leaders have an opportunity to address this inequity by rethinking their inclusion and diversity efforts. Here are some simple ways to avoid racial, gender and age bias and being inclusive of disabled workers.
Allow employees to take time to learn something new about the lived experience and reality of marginalized communities every week. Facilitate the identification of unconscious bias among your employees by:
Encourage employees to introspect and learn
More than 60 million adults (or 1 in 4 adults) are dealing with mental health or substance abuse issues — and eight million are dealing with both. Higher rates of drug abuse and overdose have been tied to the rising suicide rate: 129 Americans die each day from suicide. Those addicted to painkillers are 50% more likely to have contemplated suicide. Research by Psychology Today found that systemic racial discrimination can contribute to health problems, including depression and anxiety. Hearing individual stories and experiences of people makes the impact of the crisis more real to leaders. Recognize, that as a leader, creating a diverse and inclusive culture begins with you. Lead by example to understand what unconscious biases are, and how to recognize and overcome them in your workplace.
Lead with positivity
By 2025, 41% of the US workforce will be diverse (non-white) and 47.1% would be women.
Take the self-assessment now or read on about looking to exit the business in a not too distant future.
Employers with more diverse workforces are 35% more likely to outperform their industry counterparts in revenue and earnings growth.
4, 5, 6. Guardian Life Workplace Benefits Study, Workforce 2020 7. https://ssl.lvl3.on24.com/event
of workers strongly agree that it is important to work for an employer that creates an inclusive workplace culture.
68%
Build a model that is adaptable, cost-efficient, and focused on solving the problems employees are experiencing now. Instead of hosting webinars with specialists, create safe and respectful spaces for employees to share their experiences with racism and discrimination. Instead of floating a survey to check on employees’ pulse, organize Friday afternoon virtual tea breaks to catch up with everyone.
Use a simple framework
women
47.1%
diverse
41%
• Using gender-neutral language in job advertisements or practice blind hiring • Not expecting candidates to have “strong English-language skills,” or be “clean-shaven” to avoid cultural or racial bias • Not asking for GPA or SAT scores to avoid cultural, age and gender bias • Providing flexible schedules and work from home options for disabled applicants
• Allowing open discussion of inequalities in our society • Encouraging employees to look inwards and introspect their unconscious biases and to contemplate their words and actions • Inspiring them to analyze how their background influences the way they perceive and interact with others
Stay one step ahead by connecting your employees with the resources they need. Create a hub where they can get the latest updates, learnings, and any help that is available to them.
20% Employees who perceive bias are nearly three times likely (20% vs. 7%) to be disengaged at work.
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Workers with a disability account for about 2% of the full-time US workforce, or more than 2.5 million persons. Over 14% of them work with small employers.
When it comes to business protection strategies, a comprehensive and properly funded buy-sell agreement is one of the most important tools available to small business owners. A buy-sell agreement is when one party (or parties as it may be) agrees to buy the deceased owner’s share of the business at a predetermined price from the deceased owner’s estate or heirs. Having such an agreement in place can help to ensure the smooth transition of ownership while also minimizing the potential disruption of day-to-day operations. Owners should periodically review the value of the business, the buy-sell agreement, and ensure that life insurance coverage is equal to the growing value of the business. Failure to plan can affect the ongoing viability of your business and the family of the deceased owner as well as that of the surviving owner. For all that it is worth, there are also many misconceptions and unknowns around buy-sell agreements that can have unintended consequences.
Understand the importance of a buy-sell agreement
Exiting the business successfully
Preparing your business to continue after you’ve moved on is a process that begins long before your last day of work. Even if you have a clear successor in mind — a family member or trusted employee who is keen to take over, say — you’ll have to make sure that they understand your business as thoroughly as you do and that your business is ready to be passed on. One key step is making sure that your business has a well-designed, written plan; committing your ideas to paper can force you to articulate things you’ve been doing instinctually. Another is making sure you’re adequately transferring risk — if you are unable to work for as long as you’d planned — to keep the lights on until your successor is ready. And always make sure that you have an impartial business valuation.
Enable your business to flourish even after you exit
As a business owner, it is your duty to ensure your operations, products and services do not cause any undue grievances to any third parties. It can be difficult to keep track of your obligations to customers, employees and vendors and prevent every mishap from happening. Business liability insurance is vital for every business owner. This cover protects your business from the penalties, obligations and other risks related to a liability.
Tie the loose ends
Take the self-assessment now or read on about what to do when everything feels like a priority.
8. https://www.globenewswire.com/news-release/2017/08/31/1189442/0/en/Rocket-Lawyer-Survey-Reveals-Vast-Majority-of-Small-Businesses-Do-Not-Have-Succession-Plans-for-their-Businesses.html
of entrepreneurs do not have a succession plan in place.
8
72%
You are looking to exit your business in a not too distant future and your priority is to sell your business or leave it in the hands of your chosen successor.
You likely know the approximate value of your home, your car, and your retirement account, but like many closely held business owners, the value of your largest asset – your business – may elude you. The foundation of many sound business strategies – as well as many aspects of personal planning – is built upon an accurate estimate of the value of your business. An incorrect estimate of your business’ value could lead to less than optimal business and personal planning. Get an appraisal done on your business by a qualified valuation expert. Once you know the value of your business, there are many options to consider in order to insure it in the short-term and long-term.
Determine the true value of your business
When you don’t know what part of your business deserves the most immediate attention, it is wise to take a step back and prepare a strategy that pulls together a vision for the business, setting clear objectives and providing an action plan.
Prepare for the ebb and flow of your business cash flow
The right financial approach to your business strategy can do more than just providing the cash your business needs to function; it can also minimize costs and reduce risks. Although you may not be able to achieve everything you would like, you will have a better understanding of which trade-offs you are prepared to accept. Some key practices to ensure you are adequately prepared for the rainy day:
A business is more than just a person or people doing a job - it is also an idea, a goal! Making a written plan for the future of your business is a crucial step for pursuing growth and avoiding common pitfalls.
Clarify and organize your priorities
• An up-to-date picture of your cash position • Minimizing bank charges • Keeping a line of credit open with your financial institution • Maintaining customer and supplier relationship • Demonstrating your financial controls
Social networking, interpersonal ties, and the ability to create new connections are essential characteristics of sustainability of a business. Networking is valuable for knowledge exchange, and an increase in small-business owners’ knowledge leads to a higher sustainability rate in their business operations. Most small-business owners lack experience, do not have a history of previous success, and need funding information so networking can be of value.
Bank on your peer network
Take the self-assessment now.
Having an idea of what your business is worth is not the same as knowing its fair market value. Many business owners fail to consult with independent valuation firms to determine the fair market value of their business, relying instead on book value. An inaccurate business valuation can result in underpaying the seller, not having enough money for retirement or a disability, not leaving enough money to a business owner’s family upon death. A business valuation can end up saving business owners millions of dollars!
Learn the fair market value of your business
of business owners don’t know the value of their company.
9
98%
Talking to a financial professional can help you clarify your priorities, set goals for your business and make a strategy that will help you for years to come.
• A plan can clarify where your business is strongest and in which areas it needs improvement. • A plan can help you forecast for the future and keep you honest when assessing your progress. • A plan is the first step in becoming a more confident business owner.
9. IBIS World, “Business Valuation Firms in the U.S.”, 2014, as quoted by entrepreneur.com.
Making time for and strategizing your business priorities is entirely self-directed; you don’t have to redesign any parts of your business or reengineer a work process. It’s crucial to share your plan with a financial professional. Explain which activities you are getting out of and why. And agree to discuss what you’ve achieved in a few weeks’ time. Without this step, it’s all too easy to slide back into the old ways. This exercise is a useful “forcing mechanism” to help your become more efficient, effective, and engaged business owner.
Take the self-assessment test now.
Self-assess your priorities and preparation
Find out by checking off the boxes in each category.
Asset Protection Knowing My Business Worth Succession Planning Strategy Attracting & Retaining Key Talent Death / Illness / Injury Protection Family & Estate Protection Protection from Lawsuits Employee Benefits Executive / Partner Loss Protection
Priority Level
High
Medium
Low
Thought About it
Have a Plan
Have Tools & Solutions Implemented
(If you’ve made it here, you’re already on your way.)
Use this checklist to plan your next steps and prioritize what activities you’d like to check off first.
Articulate my business priorities and preferred methods for reaching them in a written plan.
Develop a timeline for my business priorities.
Create a process for establishing forecasts and KPIs to track and measure my progress.
Ensure my business and I are protected by transferring risk.
Conduct a quarterly review of my plan against KPIs and adjust my strategy accordingly.
Work with a financial professional for a regular, impartial view of my business.
Check out the Business Owner Experience, an interactive tool to help you nail down your business priorities and act on them with the help of your financial professional.
Knowing My Business Worth
Succession Planning Strategy
Executive / Partner Loss Protection
Attracting & Retaining Key Talent
Death / Illness / Injury Protection
Family & Estate Protection
Protection from Lawsuits
Employee Benefits
(choose one)
(choose all that apply)
Status
