Quick Tips for Dealing with Setbacks and Common Business Problems

Provided by the International Finance Corporation

All businesses face difficult situations that can prevent business growth or lead to business failure if the issues are not detected and dealt with on time. The following are quick tips for dealing with setbacks and common business problems:

Benjamin Franklin said, “An ounce of prevention is worth a pound of cure.” It is impossible to predict what problems your business will face in the future, but you can anticipate some issues and prevent others from getting bigger if you check the health of your business regularly.

Use monitoring tools to detect if something is going wrong, and take action as soon as you detect a problem. Listen to the concerns of your company’s stakeholders (employees, customers, suppliers, etc.), as these may be warning signs you can address to reach resolutions.

Ensure your strategy does not solely focus on short-term goals, which could prevent you from visualizing your company’s future. Be vigilant of the changes in your business environment too. Using business tools, such as a SWOT Analysis, can help you anticipate potential threats and prevent them from materializing.

Could you afford to lose one of your best clients? Are you ready to compete with new companies entering the market? Have you ever thought that one of your key employees could suddenly leave?

Be prepared to deal with such problems and have a plan to mitigate potential consequences. For example, do you want to keep your staff happy and decrease the likelihood that they leave? Implement measures to retain your staff, such as balancing work and family life, investing in talent and staff development, and rewarding staff performance. However, if a key employee leaves, have a plan to mitigate the consequences. For example, having your company’s processes and procedures in writing, and keeping important files and documents accessible and organized, will help new staff get up to speed quickly, making it easier to replace key staff.

If a problem occurs, start by diagnosing the root causes. Only when you find a problem’s root will you be able to tackle it. Often, the cause of a problem hides in ineffective business management and operations, or is precipitated by changes in your business environment that you have failed to foresee. Find out why things happen, and from there, it will be easier to fix the problem.

Problems, if present for a long period of time, can deteriorate and destroy your business. Focus on acting on the things you can control, and ask for professional advice if you are unsure of the best going forward. If necessary, create a small committee within your company who can help you deal with the problem.

If your strategy is going to affect your stakeholders (employees, investors, suppliers, etc.), talk to them about it. Listen to their concerns, and demonstrate your understanding of the problem and the appropriate resolution. Doing this will help them stay calm and reinforce their trust in your leadership.

Always remember to take advantage of new technologies and developments in the market that may help you redirect the situation. What initially looks like a problem, may turn into an opportunity. For example, the sudden arrival of a new competitor can push your company to innovate, change, improve and grow.

You should think about monitoring the implementation and effects of the resolution. This will help you verify if your strategy is working. Take into account that the results of your actions may not be immediately visible. In some occasions you will need to be patient, even if the situation may be critical.

Learn from failures to avoid making the same mistakes in the future. Analyze what happened, your reaction, and what you could have done differently or better.

Have a look at the following article to find out how to address problems that may impact your business, including coping mechanisms, mitigation measures, and potential opportunities.

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