What is common among Brazilian companies that opened their doors in 2020, at the beginning of the pandemic? If we take into account the trend pointed out by an IBGE study 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 resist the first five years of life in Brazil and do not even need a single event in history, such as the pandemic, for them to close their activities.
Along its path, some of the biggest obstacles for organizations in the country have to do with the behavior of their leaders. Something that is independent of chaos in health, climate or economy. A posture that does not give due attention to planning, management or even the pace that the company needs to maintain to create conditions to expand.
The Brazilian scenario, with sudden regulatory changes, high interest rates and excessive bureaucracy, is already complex enough for the entrepreneur to create even more barriers.To understand how a larger number of companies can build longer-lasting trajectories, however, I like to think of the 5 Ps of corporate survival.
As much as the winds change and the entrepreneur needs to redirect the rudder, starting with a well-structured plan is essential. Better to have a plan to be changed than to navigate without a suitable one, or none. Perhaps the idea of a Minimum Viable Product (MVP) has led some to interpret that any and all parts of the business are in the testing phase, waiting for insights to improve over time.
Yes, everything can be improved. However, not all adjustments can be left for later. There are strategic decisions that need to be made from the beginning, otherwise a company loses relevance. There are costs of innovation and technological transition, for example, that, if delayed, make operations too expensive or even make the business unfeasible.
The key to growth lies in the balance between solid planning and what can be made more flexible.Between values, beliefs and resources that the company must have since its foundation was born with them & what it can acquire over the years.
The second P is performance. If for some time the availability of venture capital in the market allowed to accelerate the expansion of companies before they were able to generate revenue, this cycle is over. Now it is essential to focus on business efficiency since day 1. Think of ways to show investors that the company is able to grow in a predictable and scalable way. Prove that your model works and, better yet, is profitable.
The third P concerns processes. Be easy for the customer to understand, simple for the team to deliver. Be wary of what is digital 100%, because digital does not work alone. It is necessary to identify how the decades of experience of professionals can talk with new technologies to accelerate results. Both are complementary.
The fourth P is people. A company cannot expect to grow to begin valuing its talents, which includes recognition, skills, and creating a strong and diverse culture. A 2024 Gartner survey indicates that skill shortages are the biggest workforce-related risk, according to 80% of counselors surveyed.If you are not helping your people evolve, other organizations are helping theirs and can reap benefits.
We still have time until December to give our companies an even more promising destination. Is that when our fifth P comes up: departed 2026?