“Keep your head cool and your feet hot.” This phrase, coined by a renowned football coach, encapsulates a powerful approach to facing adversity. In times of upheaval—like the current business landscape shaped by recent tariff announcements—it’s crucial to balance urgency with a calm, rational mindset. While the situation may feel unprecedented, the path forward resembles other business crises: a need to evaluate options objectively and strategically.

The Essentials of Managing Change which include adapting to Change

Successfully navigating change requires four fundamental elements:

• Agreement on the Need to Change: Everyone must recognise that change is necessary for survival and growth.
• A Clear and Shared Vision: A unified strategy ensures all stakeholders are aligned and moving in the same direction.
• A Feasible Plan: The strategy must be realistic and actionable to avoid overwhelming the organisation.
• Capabilities for Execution: The team must possess the skills and resources to implement the plan effectively.

Rather than discarding existing strategies, businesses should focus on refining what already works, ensuring adjustments are made where necessary. The severity of changes will depend on your company’s position relative to the impact of tariffs, but the assessment process should remain consistent.

Profit Margins: The Focus for the Coming Year

As we look ahead to the next 18-24 months, profit margins will be paramount. Utilising an OGSM (Objectives, Goals, Strategies, and Measures) framework for long-term strategy is invaluable, but it must translate into clear, short-term actions that resonate with every team member. While OGSM is a very good framework to create and deploy a Strategic Plan it’s certainly not the only one. Regardless of how tariffs affect your business, consider reassessing the following elements in your Strategic Plan:

• Objectives & Goals: While long-term objectives are important, immediate focus should be on protecting margins. This is vital for sustainability, as tariffs will likely pressure both consumer spending and your cost of goods sold (COGS). Tactics to enhance margins may include improving marketing ROI, optimising product mix, and transforming supply chains. However, never stop investing in your brand and customer relationships. For many Brands it may be unavoidable to raise price, in this circumstance Value Reframing and Innovation are essential to preserve a strong Brand Equity.

• Where to Play (WTP): This aspect involves strategically allocating limited resources. In uncertain times, reassess your WTP choices and determine where to cut back. Ask critical questions about which brands, products, consumer segments, or geographical markets deserve your focus. Data-driven insights, ROI, ROAS and ROIC, can guide these decisions.

• How to Win: Prioritise operational strategies and short term building blocks that drive efficiency and reduce costs. Ensure your supply chain and R&D teams are equipped to drive structural savings without compromising quality. While it’s essential to cut unnecessary expenses, continue investing in long-term innovation.

• Cash is King: With widespread cost increases affecting the market, maintain a sharp focus on free cash flow. Review your cash conversion cycles and trade terms to keep your balance sheet healthy, minimising debt service costs and ensuring your ability to reinvest.

Assessing Feasibility

Once you’ve identified areas of focus, it’s crucial to evaluate the feasibility of your revised plan by addressing three key questions:

• Is your organisational structure financially sustainable?
• Do you have the right competencies in your team?
• Are your capabilities aligned with delivering the revised plan?

These inquiries can be challenging and may even necessitate restructuring, potentially leading to team reductions. However, addressing them thoughtfully is essential for long-term success. Revising your Strategic Choices before making structural changes is critical—jumping to reorganisation without that strategic clarity unavoidably leads to missteps.

Streamlining Processes and Communication

If adjustments are necessary, ensure your team’s workload remains manageable by streamlining internal processes, clarifying roles and responsibilities. Align short-term metrics with your company’s reward principles to maintain motivation and accountability.

Finally, never underestimate the power of communication. Don’t assume that strategic adjustments will automatically be understood throughout the organisation. Engage your middle management to foster ownership and alignment with the revised strategy. A well-deployed plan, where everyone feels involved and informed, is key to navigating uncertainty effectively. Experience shows that Learning Maps and Business Games are highly effective interactive methodologies to bring the best of your team in finding the best course of action.

These suggestions come from years of learning and reflecting on many successes and a fair share of mistakes. Because of this experience, we’re able to help our clients deliver better results, faster.

Reach out to our team today if you’d like to discuss a challenge you face.