As roofing companies struggle with the challenges and uncertainty caused by the COVID-19 pandemic, business leaders should not only be thinking about how to survive and ride out the economic downturn, but also about what can be done to better position their organizations for growth after the economy returns to normal.
Positioning yourself for post-crisis growth means taking care of three stakeholder groups today. First and foremost is your people. Keeping employees motivated and engaged is important under any circumstances, but it becomes particularly critical when they are stressed out about their health, losing their jobs and not being able to support their families.
One way to maintain motivation and engagement is with constant and consistent communication. Make sure employees know what is going on in the organization, the challenges you’re facing, where you are winning and where you are not. Make sure they also understand the direction of the company after COVID-19 and how your actions today align with this future. This type of transparency goes a long way toward keeping people engaged and dedicated to what you are trying to accomplish.
It sounds like common sense, but it is also important for a company’s senior management to take care of themselves. Senior management is responsible for making the best decisions possible that will impact the company’s future, its employees and its customers. Being exhausted and stressed is not conducive to making smart decisions. During a crisis, CEOs and management teams need to be at the top of their games, so simple things like getting enough sleep, eating right, exercising and spending time with family are all key to managing stress.
Once internal stakeholders are covered, it is time to look to your customers. Recognize they are facing their own set of challenges right now. Being flexible, responsive and understanding with your customers increases your chances of retaining their business, particularly once their wallets begin to open wider. Finding new and innovative ways to do business with them and meet their needs will go a long way toward building customer loyalty. Companies, like people, show who they are in difficult times. Show your customers your organization is an ally worth keeping by demonstrating your willingness to work with them, whether that means flexibility on payments or finding ways to reduce their costs. The most valuable customers will remember those actions.
Defining Your Strategy
Looking to stakeholders is a strong and necessary start, but you will also need to take a hard look at your strategy and resource allocation. It is vital to clearly understand what drives your business and, more importantly, what doesn’t drive it. Being able to identify the most critical factors that are sustaining your business will help you make smart decisions that will enable you to go the distance. What has been the most effective and efficient way you have acquired new customers? How have you retained existing customers? What products or services have been the most profitable? If you can cut through the clutter and clearly see what has and has not worked in the past, you can make more effective decisions around what will yield the best results now.
If cutbacks need to be made, keep the previous analysis in mind, and be surgical about where and how cuts are executed. Slashing budgets and making reductions without careful thought can cripple sales, marketing, service and distribution functions and handicap a company for years.
We often hear about companies implementing specific “across the board” percentage budget cuts. This is not a good idea. Hacking away to save money now without being thoughtful about how you do it, is setting yourself up for medium- to long-term failure. Remember that the focus needs to be on persevering and even investing in the things that drive your business. Limit your cuts to the things that are not critical.
Remember to also keep your company’s critical business drivers in mind when evaluating initiatives, particularly when considering risk and reward trade-offs. Big opportunities are very tempting to entrepreneurs, but right now, chasing them may not be the best move. You can control your risks better by emphasizing the things you are good at and playing to your company’s strengths. Opportunities must be evaluated within the context of your organization, and what may be a great opportunity in a vacuum may not be a great one for you. Don’t just think about the opportunity in terms of market size or potential revenue, but also consider your ability to execute on it and your likelihood of success given your company’s structure and capabilities. This disciplined and focused approach will encourage efficient use of your resources, drive consistent growth and reduce your organization’s risk.
Once you have determined where you should be focused, don’t wait to look for pathways to get there. As hard as it is to be forward-thinking right now, keep your eyes open for opportunities such as acquiring competitors, upgrading or adding additional talent, and aggressively pursuing new customers to increase market share. Even if you can’t execute these initiatives until after the market improves, laying the foundation for them now is essential.
Similarly, begin lining up the funding and capital sources your plans will require. If you need a new banking relationship, a larger line of credit for working capital purposes or an equity injection from investors, having initial conversations now is better than waiting because these relationships don’t just develop overnight. It takes time to tell your story to potential partners, build credibility, feed them information and answer their questions. If you wait to have these conversations until the market rebounds, you will likely get left behind.
The bottom line is that post-COVID-19 growth is not going to happen by accident. If you take care of the right stakeholders today, put in the effort to understand your business and adjust your strategy accordingly, you can not only get through this downturn, but set your business up for growth on the other side of it.
About the author: Brian Kruse is CEO of Legacy Roofing Services LLC, with locations in Akron, Bath Township, and Columbus, Ohio, where he oversees the day-to-day operations of the company. He earned a B.S. in mechanical engineering from the University of California, Berkeley, and an MBA from the University of Chicago Booth School of Business. For more information, visit legacyroofing.com.