With inflation at a 40-year high and the risk of recession looming, many business leaders are questioning if they should stick to their current business plans or pivot.
On August 30, Blackink IT held an event with three panelists to discuss how to navigate a high inflation environment with strategies for 2023. We learned from Barbara Uggen-Davis, CFO at Elevate Ventures, Brad Justus, Business Coach at Inspire Results Business Coaching and John “Boomer” Boomershine, Director of Client Engagement and Managed Security at Blackink IT, on how to best navigate the ever-changing economy.
Most people understand that during an inflationary period, it is impossible to avoid the impact of the changing economy. However, it is possible to minimize its impact. Barbara Uggen-Davis explains that the first step to minimizing this impact is understanding the risks facing your business. She asked the audience, “what can you not live without?” She challenged listeners to think about what budget items are critical, and which aren’t essential to stay in business. Other suggestions from the panelists include:
Talent retention is incredibly important, particularly when considering the current employee shortage. Brad Justus recommends that companies “share financial information, as much as possible, so that employees are in-the-know, because perception is reality.” Brad also shared advice regarding creating a great culture: “Protect employees bottom line, work to offer training on financial matters, offer work from home options to help with fuel costs...”
Barbara noted that, when it comes to retaining talent, it is important to consistently check in with your employees by asking “what do you want to be doing, earning, and learning?” Knowing what is important to your employees and consistently communicating with them can help to create strong culture.
While there is no sure way of perfectly predicting financials, Barbara indicated that it is best to utilize “flexible budgeting,” where you can make assumptions on what inflationary numbers will be. She recommended that companies work to build everything into their sheet so that it is easy to multiply different percentages across the board. This way one can prepare for the worst, but also be prepared for the best. “Boomer” recommends that companies “think long view, 3 to 5 years out.” He even advised that companies should consider “longer term contracts to control expenses”. Other advice from the panel includes:
In times of economic uncertainty, whether it be inflation or a looming recession, there is no “one size fits all” answer. However, throughout our event the panelists continued to reiterate that the effects of inflation could be mitigated by continually identifying and evaluating your risks, transparently communicating with employees, and always planning for the long-term.
At Blackink IT, we work to help businesses create efficiencies in their technology to plan for long-term strategy. To learn more about Blackink IT, visit us here.