2016: The Year to Bulletproof your Business in NL
May 23, 2016
By: Des Whelan, Chair, St. John’s Board of Trade
For almost 30 years, Canada has been losing its comprehensive edge, lagging behind the United States and most OECD countries. Last September, we slipped another notch to rank 15th on the World Economic Forum’s annual list of Most Competitive Countries, down from 9th place in 2009.
This is an important issue for businesses located in Newfoundland and Labrador as they attempt to advance the productivity and competitiveness of the region. Companies are faced with the challenges of rising costs, increased, competition from outside the region, lack of available skilled labor and gaps in innovation.
A key pillar of the St. John’s Board of Trade’s resilience is the need to be proactive. The past five years haven’t been the best ever for small and medium sized companies in the province, but the winds of economic fortune are changing and owners need to become nimble to chase the opportunity.
Complacency is the biggest concern. Our research indicates that most owners do not have a well-articulated plan for their future. In too many cases, they are focused on working in their business, rather than working on their business.
A strong, vibrant small business community is essential to our economy. Since we’re so dependent on natural resources here, which can suffer incredible swings, we need to help ensure local companies are resilient. We can do this by helping them mange through slow times and investing in them during the good times.
We have so much potential in this province and we need to ensure that our economy remains strong in the years to come. If we are not strategic and focused, we run the risk of being victims to happenstance.
We need to be masters of our own collective economic destiny and to do that we must take stock of the health of our local business community. A successful private sector is at the core of any prosperous and sustainable economy.
Owners need to prepare a vision and plan for their future prosperity within the framework of this province. Our research has indicated that although succession planning is critical, few have actually put a plan in place.
Now is the time to invest in the technology, people, markets, and innovations that will see our continued success in 2020 and beyond.
The owners of small companies need to make plans for how they see themselves in the next 5-20 years. They have to invest in development activities, export markets, research innovation, productivity improvements, and sourcing the right talent. But first they need to do an assessment of their current practices.
Here are some things to think about as you contemplate the future of your business:
Only 25% of occupations that existed in the 1960s still exist today. The fact-paced evolution of technology, aging demographics and shifting population has made recruiting and maintaining the right talent more challenging than ever. Ensuring you hire the labor force for the 21st-century is critical.
In the age of artificial intelligence and advanced robotics – are you prepared for disruptive technologies? Don’t think it can happen to you? Ask your next cab driver about how Uber has changed their business. Uber, Airbnb, and 3D printing are all examples of how technology can disrupt an entire industry overnight. We can all prepare for the age of disruption by cultivating awareness, becoming more agile and building the right internal culture.
MARKETING & SALES
The internet has turned the retail industry upside down. Local companies can now sell their products and services around the world and international corporations (like Amazon) can capture a huge market share without having a store front presence.
Yogi Berra said it all when he stated “If you don’t know where you are going you will end up somewhere else.” Business owners need to articulate a vision for the future and develop a plan for how to get there. This requires taking a break from the day to day routine to develop a vision and strategy for you future.
70% of business owners are set to retire in the next 10 years. The vast majority of people are counting on the sale of their company to fund their retirement plans.
According to Export Development Canada, those who export products and services are more innovative, productive, profitable, and risk averse. In this province, and most of Canada, we have very small domestic markets. To tap into the global market, we need to encourage companies to expand beyond our borders and take advantage of these scaled economies.