What do Brazilian companies that opened their doors in 2020, at the beginning of the pandemic, have in common? Considering the trend indicated by a study from IBGE released at the end of last year, 60% of them will close their doors by December. This is the index of companies that do not survive the first five years of life in Brazil – and it doesn't even require a single historic event, like the pandemic, for them to cease operations.
Throughout their journey, some of the biggest obstacles for organizations in the country are related to the behavior of their leadership. Something that is independent of chaos in health, climate, or the economy. A stance that does not give proper attention to planning, management, or even the pace that the company needs to maintain in order to create conditions for expansion. Take the right steps at the right time.
The Brazilian scenario, with sudden regulatory changes, high interest rates, and excessive bureaucracy, is already complex enough for entrepreneurs to create even more barriers. To understand how a greater number of companies can build longer-lasting trajectories, however, I like to think of the 5 Ps of corporate survival. The first of them is planning.
No matter how the winds change later and the entrepreneur needs to steer the helm differently, starting with a well-structured plan is essential. It's better to have a plan to be changed than to navigate without an adequate one, or none. Perhaps the idea of a Minimum Viable Product (MVP) has led some to interpret that every part of the business is in the testing phase, awaiting insights to improve over time.
Yes, everything is subject to improvement. However, not all adjustments can be postponed. There are strategic decisions that need to be made from the beginning, or else a company risks losing relevance. There are innovation and technological transition costs, for example, which, if delayed, make operations too expensive or even make the business unviable.
The key to growth lies in the balance between solid planning and what can be flexible. Between values, beliefs, and resources that the company must have from its founding – to be born with them – and what it can acquire over the years.
The second P is for performance. If some time ago the availability of venture capital in the market allowed for accelerating the expansion of companies before they were able to generate revenue, that cycle has ended. Now it is essential to focus on business efficiency from day 1. Think of ways to show investors that the company is capable of growing in a predictable and scalable manner. Prove that your model works and, even better, is profitable.
The third P relates to processes. Be easy for the client to understand, simple for the team to deliver. Be wary of what is 100% digital, because digital doesn't work on its own. It is necessary to identify how the decades of experience of professionals can align with new technologies to accelerate results. Both are complementary.
The letter P stands for people. A company cannot wait to grow to start valuing its talents, which includes recognition, training, and the creation of a strong and diverse culture. A 2024 Gartner survey indicates that skills shortage is the greatest workforce-related risk, according to 80% of the interviewed advisors. If you are not helping your people to evolve, other organizations are helping theirs, potentially reaping benefits.
We still have time until December to give our companies an even more promising future. Is it when our fifth P appears: departure 2026?
