Established companies can afford employees who take care of PR. A Start-up consists of a small team that has to take care of all business aspects. In the absence of sufficient resources, they cannot do everything at once. Due to the initial lack of orders and customers, firms are primarily concerned with marketing (i.e., website, SEO, target groups, or advertising) – without realizing that they have to start preparing their deliverables before they promise anything to the market – although Henry Ford already knew: You can’t build up a reputation on what you are going to do.
However, what burdens in the medium term are the homegrown deficiencies. They arise when the deliverables are not ready yet, and false promises are made, the work is not organized, the cooperation lacks leadership, and the employees lose their commitment.
- Inappropriate deliverables
The urge to provide new deliverables, internally or externally, is reinforced by the personal interest in materials, techniques, activities, or abilities. Their passion sometimes leads to deliverables that please the originators but no one else. Even if a comprehensive market investigation is too costly, founders should make efforts to understand their market in advance.
– Which customer groups are being targeted?
– What do these groups expect?
– What issues of the customers will be solved?
– How much are they willing to pay for it?
– What are comparable proposals in the market?
Consciously considering these issues and talking to people of your environment help develop deliverables and reduce the danger of creating inappropriate deliverables.
- False promises
Puff is part of the trade. However, the necessary PR needs tangible propositions. Unfortunately, the features are unclear at the beginning of the development, i.e., not everything has been digested or described yet. On the other hand, the increasing share of services cannot be shown through use cases. In addition, wishful thinking and hubris contaminate the promises. This raises unrealistic expectations that inevitably disappoint the clientele.
Only advertise deliverables that are comprehensively described, or better, fit to action. Use the language of your target group without promising something you cannot deliver.
- Poor organizing
The design of the entire value chain often begins after the products are fully developed. The roles, procedures, data processing, templates, etc., are missing. The business model is influenced, for example, by the sales channels: e.g., via retail and mail order, an online store, or sales reps. Suppose these channels are not already considered during the organizing. In that case, it can lead to difficulties in the ongoing operations, e.g., due to incomplete or incorrect customer data in the mailing or the clumsy design of the packaging concerning dimensions, weight, protection, and shipping costs. Or let us consider the prepared procedures and templates, e.g., for quotations and invoices.
If the commercial building blocks are not prepared, they burden the daily procedures with additional disruptive activities and double work due to the subsequent correction of flaws.
- Unguided collaboration
Unexpected difficulties arise when the development of deliverables obscures the look at leadership and coordination of the employees. The smaller the company, the more spontaneously the founders steer their employees. Even here, groups form with varying degrees of interaction, leading to misunderstandings and conflicting actions. If on top of that, leaders suffer from hubris and think they have to micromanage everything by themselves, then it indirectly leads to disrespectful interaction that undermines the willingness to cooperate.
It is not so much a question of a particular form of organization as of consciously shaping collaboration – and not just when the effects impact on the customers.
- Lack of commitment
Founders are motivated by themselves and assume that the workforce feels the same impetus. For a time, this may be true. However, habitual behavior will become ingrained, which also exists in large companies. At that point, at the latest, countermeasures must be taken, as the dwindling commitment will quickly impact performance.
Extensive employee involvement and participation in decisions are effective motivational factors. The participants need a long-term perspective that secures commitment.
Bottom line: Even though the proposals are in the center of interest, the results are burdened by false promises, an ineffective organization, unguided collaboration, and a lack of employee commitment. For this reason, everyone needs to address homegrown threats so that customers do not run away frightened.
As soon as the unimaginable happens, the boundaries shift. Who would have thought that the well-worn delivery routes would come to a standstill, millions of employees would be put on short-time, or average citizens would protest against the elected government in the streets. We live in the present, vaguely recognizing the past and looking to the future with confidence. In doing so, we overlook the fact that the future is not visible but consists of distorted presuppositions. We are facing a disruption (D-Day) at any moment – like the Chelyabinsk meteor on February 15, 2013, the COVID-19 pandemic since December 2019, or the Eyjafjallajökull eruption of March 20, 2010. We rarely deal with possible significant disruptions that have not happened for a long time or never happened. Yet, we had to learn that they can occur at any time. The consequences threaten people locally, regionally, or even globally.
In risk management (RM), emergency solutions are thought of in advance. A large-scale epidemic and its impact have had a low profile when considering the various measures and contagions. For this reason, we are looking at potential breaches that could slow down or halt our established processes.
Although pandemics are estimated to occur every 30 years (Future Global Shocks, OECD), their unpredictability (Where? When? Propagation speed? Infection rate? Mortality?), as well as possible impacts on other areas (Society, Economy, Mobility, Logistics, etc.), mean that so far the RM has rated this risk relatively low.
- Environmental disasters
The volcanic eruption in Iceland mentioned above resulted in 100,000 flights being canceled, ten million people affected, and 1.5 to 2.5 billion euros in losses in air traffic accumulated. There are nearby mega-cities latently threatened by dormant volcanoes, like Tokyo, Naples, Mexico City. How the many possible environmental catastrophes are assessed by those responsible, not only locally, is decisive for whether transitional solutions are prepared for the broader environment.
- Infrastructure crash
The infrastructures of developed countries such as Norway, Australia, the USA, Germany, and Canada have proliferated over decades. Today they are showing signs of decay in communications, energy, and traffic. In addition, they are threatened by the consequences of accidents (for instance, through nuclear power, toxic raw materials, and chemicals) and environmental disasters (climate change, natural disasters, and geomagnetic storms). How do risk managers safeguard global supply chains?
- Civilizational Collapse
Societal changes in Asia, the Arab world, and even the US threaten the world’s achieved prosperity. When the low-wage countries fail due to terror and power struggles or the disconnected US social classes storm the Capitol, these are signs that the established close-knit dependencies are disintegrating. Those in charge should prepare contingency plans for such events.
- Resource crisis
There is still a lack of limited awareness regarding the natural resources of the earth. More than 4000 years ago, Mesopotamian city-states already fought for access to water. Today, Israel is digging up the waters of the Jordan River from neighboring countries. China dams the Mekong, causing Vietnam to run out of water. Tesla is tapping groundwater near Berlin, with unknown consequences for the region. Although resource availability is declining over time, it is unclear whether and how these risks must be assessed.
- Economic crisis
These economic crises do not arise spontaneously. Through globalization, the world’s economic systems are closely interconnected – the flow of finance, the movement of goods, far-reaching cooperation, and unstoppable knowledge flow. As soon as sand gets into these gears, there are immediate consequences for all regions of the world. This goes so far that the parties involved wage economic wars to eliminate potential competitors. But what measures are envisaged as a precaution?
In the history of humankind, 14,400 wars are said to have taken place, in which an estimated 3.5 billion people died. The number of unreported cases is probably much higher. These warlike tensions affect all risk areas – wars create environmental disasters, destroy infrastructure, let societies collapse, deplete resources and shake economies. Material consequences are inevitable. How are wars built into risk plans?
Bottom line: All these risks create disruptions that culminate in a D-Day (Day of Disruption). These events cannot be prevented. We can only respond to them with measures already prepared in the drawer and should mitigate the effects. For example, if a logistics company operates its IT outside a vulnerable area – away from earthquakes and volcanoes and trouble spots. Having intelligent solutions available, the risk must be seen in advance to provide the necessary contingency plans. Even if you don’t know what the following effects are, be prepared for your D-Day!