New e-book helps leaders 'Brexit-proof' their organisations

25 January 2019 Consultancy.uk

Project management consultancy Dada Enterprises has released an e-book that helps business leaders and entrepreneurs with preparing for Brexit.

The effect of Brexit negotiations – which continue under a cloud of uncertainty in the face of cabinet and parliamentary negotiations – have more than made their mark on the collective psyche of the business community. With the end of Brexit negotiations nigh, the levels of optimism among the UK’s financial services sector remains at a worrying low, thanks to the likelihood of rapidly changing regulatory demands, while the global economy as a whole may be heading for a period of crisis.

With regard to the consulting industry, a potential economic downturn, complex border tariffs and a shortfall in continental talent are expected to have a negative impact on fees after Brexit comes to fruition in March 2019. In the meantime, however, the UK’s protracted withdrawal from the European Union has proven to be something of a cash-cow for the professional services world.

New e-book helps leaders 'Brexit-proof' their organisations

Since the shock vote to leave the EU rocked the political and business establishments in the summer of 2016, consultants have been in heavy demand from clients looking to soften the blow of Britain’s secession from the remaining bloc of 27. As consultants continue to tap into heavy demand for their services, while their clients look to insulate themselves from the negative impacts of Brexit, Sachin Melwani, Managing Director of Dada Enterprises, has penned ‘How to Brexit Proof Your Project Strategy’, a new e-book where he walks though number of the policy’s key impacts – in collaboration with co-authors Rohit Talwar and Stuart Easton.

Transition Period

Assuming that a minor Parliamentary miracle occurs and the embattled Theresa May manages to wrangle her already soundly defeated Brexit deal through the House of Commons, there will be a period of transition as the UK and EU complete their plans for separation. Between the 29th of March 2019 and the 31st of December 2020, the "orderly withdrawal" would in this case see the UK able to negotiate, sign and ratify its own trade deals, while still being party to existing EU trade deals with other countries.

At the same time, this buffer would allow the two parties to avoid imposing a hard border in Northern Ireland, something which would jeopardise the Good Friday Agreement – a treaty agreed some 20 years ago to bring to an end decades of violence in the region between Unionists and Republicans. If a transition period does occur, then during that time, Northern Ireland will effectively stay in the single market and the customs union, while the European Court of Justice will maintain "jurisdiction" over matters relating to EU law and EU citizens.

During this added time, companies would have a greater opportunity to assess the impact of Brexit on their plans, and alter their direction accordingly. However, it is looking increasingly unlikely that businesses will be afforded this luxury, with the potential for a No Deal scenario remaining steadfastly on the table.

The Prime Minister has repeatedly refused to rule it out as an option, recently claiming to do so she would have to rescind Article 50 and potentially stay in the EU indefinitely. While many in Parliament dispute the accuracy of this, it does mean that the cliff-edge scenario remains a possible outcome. In this case, the EU and Britain would revert to trading with one another via World Trade Organisation rules immediately.

Having outlined these scenarios, ‘How to Brexit Proof Your Project Strategy’ continues by exploring how to prepare a company’s operations for these varying export rules and procedures. The e-book also  goes into detail of what the impact of additional tariffs could mean in terms of a financial and compliance burden, and the impact new regulations might have on the broader supply chain, from the availability of products to lead times.

Brexit-proof operations

Brexit may have all kinds of operational impacts. These range from a loss of cash – thanks to an end of access to funding from institutions like the European Investment Bank – to a ramping up of costs on the importing of labour and materials, as free movement with the continent ends.

This makes impact assessment a major priority, which companies should seek to push ahead with sooner rather than later. To fail to do so could also leave firms exposed to heightened contingency planning and transition costs as they scramble to be ready – and the cost of contingency planning at the last minute inevitably comes with a sizeable premium. At the moment, the Department of Transport alone estimates they will spend £180 million on EU Exit by March 2022, so advanced planning is clearly imperative to avoid such figures spiralling.

Other factors to take into account include interface costs and competition with other projects, as well as supply chain and contractor availability. The e-book also suggests that companies will need to consider in-house production, as a weak pound will likely result in many manufacturers in particular having to move production to the UK to eliminate the need to pay rising costs required by overseas suppliers and attract overseas buyers.

Ultimately, ‘How to Brexit Proof Your Project Strategy’ spells out three cast-iron rules for a successful Brexit strategy. First, companies must bear in mind that change management is about people, so a visible strategy being clearly communicated to everyone at the firm is essential. Companies must spell out how each project matters, as well as the consequences of failure.

Second, firms should measure strategic alignment constantly. This enables businesses to eliminate waste from their supply chains and eliminate the subsequent costs they incur, while allowing for heightened focus on key projects first. An AHP (Analytic Hierarchy Process) is "the way" forward, and no shortcut will work in its place.

Finally, the book extolls the importance of getting executive team buy-in into the process. Companies must prioritise on projects that support an organistaion's strategic drivers. This includes agreements on the definition of strategic direction, which should be reviewed frequently.


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