With prudent management, business can adapt to any economic situation. Many companies, in order to adapt to today's realities, develop new strategies and try to optimize their expenses. Here are the most effective steps to overcome the coronavirus crisis by audit firms.
Crisis is a time of new opportunities
The main reason for the current general market slowdown is the coronavirus crisis, which has called into question the existence of most small and medium-sized companies in the world. Although digital progress continues to influence audit and evidence collection methods, as well as the process of statements preparation, for many audit firms the pandemic has caused a systemic shock and made it difficult to work with clients.
Many owners of audit firms are afraid that during the crisis their company will suffer losses and go bankrupt. In fact, it is a time of new opportunities. Those top managers who adhere to this principle take their business to a new level. They find ways to develop in new areas, so the company's profits begin to grow.
If you want to bring a company out of the crisis with minimal losses, you need to make a new action plan. It should set out the real state of affairs and indicate the prospects for business development. There should be no empty promises or elusive goals in the plan. For most companies, it can be a starting point for development.
Diagnostics of the situation
The easiest way to survive a business in crisis is to eliminate the causes of its occurrence or at least diagnose the most problematic areas in time. This requires a thorough and comprehensive analysis of the external and internal environment, identification of those components that really have priority for the company, collection of information about each component, and assessment of the real state of affairs in the audit services market in general and in the company in particular.
Cash flow optimization
Cash flow optimization is one of the important tasks of anti-crisis financial management. The first thing to do in this direction is to introduce a procedure for daily reconciliation of the cash balance. This will eliminate possible abuses, give managers reliable information about the current balance in the accounts and at the cash registers needed to make decisions about making current payments.
Сommon mistake is that in times of crisis, many companies try to increase cash flow by raising the price of services without prior market research. Increase of sales in a crisis situation should be expressed in the development of relationships with existing customers and attracting new ones, market offers of new services in accordance with market changes and new demands due to the spread of coronavirus, as well as revising the existing system of discounts and benefits for customers.
In a crisis, cost reduction is one of the most effective tools a company can use to stabilize its financial position. To reduce costs in a crisis, it is necessary to strengthen the procedures for their authorization, motivate staff to reduce and cut secondary costs not related to the main activities of the company. It is also necessary to analyze the possibilities of outsourcing expensive processes.
Preparing team to changes
The company will be forced to face personnel problem during the crisis constantly. To ensure some staff stability, at least at the lower and middle levels, it is necessary to plan the company's cash flows in such a way that there are never any delays in the payment of salaries. In addition, the degree of confidentiality of everything related to the financial condition of the company should be increased. Particular attention in personnel management should be paid to informal leaders who are negative about anti-crisis measures. The company's employees should be convinced that all difficulties are temporary and will be overcome in the near future. At meetings, it is important to voice news about the successful results of innovations and give examples of effective work of departments. This will raise team spirit and minimize resistance to change and sabotage. It is important to create such a mood that employees are happy to participate in all innovations. Managers should explain to their subordinates what each of them must do to make the company survive the hard times with minimal losses.
Tips for keeping the company in the market
Strive for continuous improvement of services to achieve competitiveness, save business and create new jobs. Next quarter's profits are not as important as the company's ability to exist in 10-20 years. Sustainability of the goal means constant work of top management on introduction of innovations, long-term planning, allocation of resources for training of the personnel, constant improvement of services.
Develop new business principles. Business has entered a new economic era. You can no longer work for a “check”, cooperate with contractors with no need, work in teams with people who do not know what their responsibilities are, and use outdated teaching methods. All components of the business need to be optimized and transformed in accordance with the new conditions.
Continuously improve services delivery system and their quality. Quality must be “built” during the company's activity. Each service provided should be considered as unique, and each client needs an individual approach. Listen to the opinions of your customers, especially those who approached you for the first time. Their opinion of your company will be unbiased and as objective as possible, and therefore will serve as an incentive to improve.
Stimulate leadership. Review management techniques. Leaders must know the work of their subordinates and have the right to inform senior management of necessary changes.
Break down barriers between units. Employees of all departments must work as a team to anticipate and address problems that may arise during the provision of services.