What You Should Do For Business Continuity

Business continuity consultants are suddenly in demand. But going with business as usual and layering on business continuity planning on top isn’t going to work, any more than having an unhealthy lifestyle and then taking medicines keeps you healthy. Instead, you should re-examine your fundamental assumptions about how to do business:

  • Don’t take on debt. Debt makes you fragile.
  • Aim for profit, so that you’re not continuously dependent on external capital, like a patient on life support. Grow naturally, without resorting to tricks like buying users for more than they’re worth (CAC should be much less than LTV). Grow like a baby growing up, rather than giving him steroids to force growth.
  • Have 18 months’ expenses in the bank.
  • Don’t lock yourself in to contracts with suppliers. For example, I didn’t enter into a one-year contract with my coworking space though they offered a free month in exchange.
  • Maintain some inventory.
  • Don’t make unrealistic promises to investors to get their money.
  • Don’t lose sight of your original business model when pursuing growth, as Oyo did when they guaranteed a minimum occupancy to hotels. Asset-light marketplaces shouldn’t have liabilities.
  • Before you hire someone, see if you can make do without them. Hire only after the need for them is solidly proven. Don’t hire pre-emptively, such as “We will need X in two months, so we should hire now.”
  • All knowledge in the team should be shared by at least two people. If someone quits, or falls sick, the show should go on.
  • Hire people who add skills to the team, so that you have all the skills you need with a smaller team.

On-demand Leader. Earlier: IIT | Google | Solopreneur | Founder | CTO | Advisor