What Are the Big Accounting & Finance Challenges to Come?
The coronavirus makes planning and budgeting far more complicated for senior management. Most companies were unprepared for a once-in-a-century pandemic, and firms simply reacted to the challenges of the virus. Here are some professions that were hit particularly hard by the pandemic, and how they reacted.
- Restaurants changed to a carryout and delivery business model
- Medical professionals introduced strict protocols to protect patients and staff, and some non-emergency medical procedures were delayed
- Retailers shifted to online sales, in order to limit customers in stores
Managers must plan to operate during the remainder of the pandemic, and consider how the business will look after the virus subsides. Your business also needs a contingency plan, in case another virus disrupts the economy. Here are two considerations:
- How will customers interact with your business to buy products and services? If your business model changes, your customers need to understand each change.
- If you’ve pivoted to a new business structure, the change must be clearly explained to everyone in your organisation.
Your business plan going forward may combine the original business model with new methods. A retailer, for example, may reopen a limited number of physical store locations, and continue to ramp up online sales. Your customers and employees need to see where you’re headed.
The impact of work-from-home
The pandemic may permanently change how millions of people work, and senior managers must plan, based on this new reality.
Global Workplace Analytics recently created a forecast of the work-at-home landscape after COVID-19. The study found that: “56% of the US workforce holds a job that is compatible (at least partially) with remote work.” The longer that people are required to work from home, the more likely that they will prefer staying at home. The result? “Our best estimate is that we will see 25-30% of the workforce working at home on a multiple-days-a-week basis by the end of 2021…”
If a growing percentage of your staff works from home, cybersecurity will become a bigger issue. All employees are exposed to the risk of malware, phishing attacks, and other cybersecurity risks. Do you have sufficient controls in place for remote workers?
Proofpoint assess cybersecurity threats, and analyses company vulnerability. They explain that marketing, public relations, and research and development professionals are most at risk for cyberattacks. If you manage customer information, such as credit card data, you need solid controls in place to prevent theft.
A successful attack can disrupt your business, and impair your ability to operate. Make cybersecurity a priority in your business plan.
Customer buying habits
E-commerce may account for a much larger percentage of company sales post-pandemic, and businesses must adjust to customer preferences.
Adobe monitors customer transactions for many of the largest retailers in the US, and publishes a Digital Economy Index. The firm also surveyed over 1,000 consumers over Labour Day weekend of 2020. Adobe expects e-commerce to capture a growing percentage of total retail sales. Goods traditionally purchased in-store, such as groceries, are now bought online by a growing number of consumers, and the trend will continue. Smartphone purchases will account for 50% on online spending in 2021 and 2022.
If you address remote work issues and online customer trends, your business will be positioned for growth.
Meeting the challenge
Managing an organisation will require more planning and effort in 2021, but the time investment will pay off. Managers who plan effectively can make more informed decisions and outperform the competition.
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