The negative effects of the Oil & Gas downturn are all around us – but more positively, we are also experiencing the need and the benefit of becoming much more efficient in managing and running all aspects of our businesses. The Maximising Economic Recovery effort has gained momentum. We have seen average lifting costs gradually fall amongst the operators, green shoots of greater collaboration are starting to appear across the industry – and crucially we see the need for more efficiencies, higher productivity, increased innovation and technological improvement in what will be the next chapter of our industry.
Businesses are still struggling with sustainability and what the future holds for them, however. For owners and shareholders, business disposal or exit is a greater challenge during a downturn and it is much harder to attract funding and to plan for growth. The greatest challenges facing businesses in our industry right now however are in facing operational or strategic challenges and quite simply, safeguarding profitability and employment for their future.
Strategic business review
All too often missed or perceived unimportant, conducting a strategic business review becomes increasingly important during a downturn. This is essential in order to provide comprehensive and critical assessments to businesses and most importantly, to deliver clear independent insights during the process.
An honest assessment of the operational, financial and management of businesses allows for recommendations for improvements to develop more robust organisations, better able to deliver objectives and to succeed. This provides a platform for management teams to take forward ideas and add value to their businesses.
Depending on each unique situation, the output may include a strategic review of organisational structure and people strategy, financial performance, business and client development, future growth opportunities, funding structure and options, indicative business valuation and value increasing initiatives.
Why consider a strategic business review?
Taking stock of your performance and planning is key to ensuring the future success of businesses. Why leave it to chance? Investing time and effort focusing on your long term objectives, and those of your senior management team has the potential to pay dividends in the future.
Planning for the future is crucial not just for giving piece of mind but also for employee confidence and engagement, customers, financiers and individual’s aspirations. The longer the planning for the future is postponed, the more of a problem there will be when it is eventually time to address it. To ensure that personal goals are achieved, and the future of businesses, the people and customers which have made it a success are protected, the sooner that strategic planning and business succession challenges are addressed, the better!
Alasdair Green is the Head of Management Consulting at Anderson Anderson & Brown LLP, Chartered Accountants. Find out more about AAB here.
