Strategic Planning With Uncertainty About Pandemic’s End

The COVID-19 vaccine rollout demands that business leaders plan for recovery in the economy as well as in health. More pitfalls with vaccinations may delay recovery, but vaccinations could accelerate thanks to learning-by-doing and copying success. Either way, companies need to be ready for expansion, but they cannot commit too strongly to one particular timetable.

Questions that business leaders now face include: Cut staffing or beef up the workforce? Invest in new equipment or conserve cash? Shift to different markets or stick to one’s knitting? It’s tempting to throw one’s hands up and say that forecasting is impossible, but decisions need to be made. And leaving business unchanged is a decision, even if it feels otherwise.

The key to strategic planning in uncertain times is to figure out what has changed, what has not changed, and what is still uncertain. Then business leaders need to plan based on those insights, incorporating flexibility wherever possible.

The “what has changed, what has not” question is sometimes easy. A food company knows that people will still be eating in the years to come. An airline knows (or should know) that some business travel will be replaced by video calls even after the pandemic. But other issues are more unclear: The entertainment industry may wonder if people will be comfortable in crowded theaters or stadiums in the years to come.

Diagram of business processes

The possible changes are not just about sales, but about all critical parts of a business. The graphic above provides a way for company planners to organize their thoughts. It can be modified for a particular company’s situation.

The flow of goods and services moves from left to right, but the dollars flow from right to left: sales brings in money, which is eventually paid out to others, including owners. Planners should start on the right-hand side of the chart, as some inputs and processes may be irrelevant if sales change.

Some sales changes have been clear, such as restaurants shifting to take-out from dine-in. Other changes are less apparent outside of the particular industry.

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