As the dust settles post Brexit, the only consistent certainty is uncertainty. With negotiations yet to start, we have little clarity on what an exit agreement might look like or how long it will take.
The EU Treaty envisages two years; most trade agreements negotiated by the EU have taken from four to nine years. Add to this instructive summaries from respected economists and accountants pointing to some 42 variables that will influence the shape of that deal and one thing is certain, a resolution will unlikely be quick or easy.
Turnaround and transformational change managers are well placed to support UK businesses during this period. Most of the risks and opportunities that will derive from Brexit in the short and medium term are very familiar, and include:
Businesses that want to do well will need to embrace this period of uncertainty and adopt a structured plan to managing it. The best advice is to face forward to the threats and opportunities ahead. The market will likely favour those willing and able to capitalise on this as an opportunity.
If cash was critical once, but is now stable, it is about to become critical once again, as customers slow payment. Orders – already deferred in the last few weeks – are likely to be deferred again, as investment is tempered by cash control. Growth and diversification strategies may well stutter.
For businesses whose stock and raw materials are priced in either dollars or euros, they just got more expensive. Transport and other oil-dependent outgoings will also be more expensive. Sterling priced exports may suddenly be more attractive, but how is the perceived threat of trade barriers going to affect continuity of custom?
For businesses that have been recipients of EU grants, CAP payments, innovation and technology grants (such as Horizon 2020), it is unlikely that the British government will step in to provide an equal level of funding, how are they going to plug the funding gap?
Only the largest companies have spare management capacity to address such a new burden. Businesses that have involved consultants and interims in the past may well need to reengage one to help them devise a Brexit strategy and implement it.
Those that haven't should be receptive to the argument that they engaging somebody sooner rather than later will help to ensure that they remain competitive and can weather the storm.
Turnaround executives and change managers can offer the resource to enable a business to assess, manage and communicate the multiple effects of this upheaval. Here are three immediate steps to take:
The outlook for the long term is uncertain but not necessarily bleak. There may well be a wealth of opportunities open to UK businesses once Brexit is implemented fully. But, only those businesses that have not been weakened by the likely slow growth and uncertainty of the next couple of years will be able to exploit them.