The company's recovery plan in 5 points

Plans and circumstances change, and when dozens of factors are involved, changing just one element can trigger a crisis or a failure. Then you need to prepare a recovery plan for the enterprise. Here you will find out how it's done, when it's useful and why it's worth having it.

Risk analysis prevents problems later 

When it comes to creating a problem risk assessment document, many view it as a meaningless formality. They don't realize that risk analysis can actually prevent problems. They can be defined in time and then remedied. It is enough to compare the situation when a company's recovery plan has to be developed and implemented suddenly with one when the risk has been known and recognized for a long time.

In large corporations, there are ready-made scenarios for various unforeseen events at the company and global level. From time to time, the media are moved by the information about the plan in the event of a disaster or the death of an important person in the country. Meanwhile, having such plans is only a precautionary measure and largely protects in the event of problems. See how to write a recovery plan in the company.

There is a concept of reorganization proceedings in Polish law. However, this formula is rarely used. "Managers of enterprises, not wanting to disclose to their contractors the fact of financial difficulties, often withhold remedial actions for too long, which results in the inability to effectively submit a declaration on the initiation of reorganization proceedings. " - writes Katarzyna Boratyńska in an article on this topic, which in 2011 was published in the scientific journal of the University of Economics in Wrocław.

It may seem unintuitive, but it is indeed: faced with a deteriorated situation, many owners are even more afraid of creating a recovery plan, fearing that they will open the "Pandora's box" and will have to face the too painful truth about reality. Meanwhile, by creating a recovery plan, companies make their way out of trouble.

What does an enterprise recovery plan consist of?

The company's recovery plan is "a summarized description of the current situation of the Company, its current problems with proposed solutions, as well as the direction of the Company's activities for the next (...) years.”- we read in the recovery plan of the Mostostal group from a few years ago.

In the book by the duo Janowska and Strzelec "When can you apply a recovery plan for an employee?" you can find a simple description of the components of a good recovery plan. It applies to situations where the employee's professional path requires correction. However, it can also be treated as a sketch in the event that a small company requires a recovery plan for the enterprise:

• description of the current situation - Janowska and Strzelec write about the current results at work, but it can also be about the company's current financial situation, problems, and the business environment.
• The method of implementing the plan - including the schedule and description of the tools necessary to achieve the goal.
• Desired result - here it is worth applying a well-known formula, according to which the goals should be realistic, achievable and measurable, i.e. broken down into time-bound and measurable stages.

What can the enterprise recovery plan be useful for?

You can use such a plan both for your own needs and in communication with the business environment or employees of the company. Thanks to this, you can support yourself with specific plans in difficult conversations and indicate entries, which gives you better grounding in reality during the conversations. A recovery plan can increase the credibility of a business that has lost its good name.

For example, municipalities often implement recovery plans to keep their finances under control while reassuring voters that they are in control and are seeking to improve. This can be compared to the fate of a person who has fallen into debt. It is very difficult to pay off your loans without a specific plan. Generalities such as "I'll spend less" are not a recovery plan. It is then very difficult to achieve lasting effects and improve the situation. Only writing new rules, setting limits and goals allows you to quickly move forward in your plans.

Case study

On the web, you can find the Qumak recovery plan, written after the company's losses of several dozen million zlotys were disclosed in 2017. In addition to the elements already described, it also contains a list of actions already taken by the management board. This shows a proactive attitude and gives the impression that the company is in control of its situation. It also includes corrective actions broken down into detailed steps, and these in turn into smaller segments. The work ends with a summary and begins with the presentation of the company's profile and structure. It's a good idea to include them in your company's recovery plan.

Such a document can change hands and it is important that the readers have the most important facts in front of their eyes at all times, such as number of employees, history or capital of the company. The Qumak recovery plan has 11 pages. More or less this is enough to comprehensively summarize the most important facts and solutions. The situation may be slightly different in the case of the recovery plan of the enterprise which is in the process of receiving funding.

EU subsidies - a special enterprise recovery plan

The most difficult situation is for those entities that have recklessly spent money that someone else entrusted to them. Especially if the co-financing was burdened with numerous clauses and required detailed settlements, as in the case of EU projects. On the government website of the Central Information Technology Center, you can find a template for an enterprise recovery plan in such a situation, which consists of:

• introduction,
• description of the progress of the project in accordance with the facts,
• description of assumptions - how it should be,
• reasons for delays,
• corrective actions taken so far,
• enterprise recovery plan,
• summary.

In such a situation, it will be a very good idea to solidly document the feasibility and legitimacy of each of the proposed steps along with the work schedule.

Image recovery plan of the enterprise

A specific situation is when the company's financial results are good, but something has damaged its image. Then it is necessary to implement the company's image recovery plan in the first place. If you can do this quickly, you might be able to prevent the problem from escalating and the losses. Such a plan should include:

• communication strategy in social media,
• risk assessment of plans and current activities of the company,
• internal communication with elements of employer branding,
• and crisis management.

All this must take place after appropriate training of employees. It is worth noting here that a recovery plan for a company dealing with image-related problems is probably the most important element of actions. Initiatives implemented without it (e.g. hot-stamped statements) can only do more additional damage. If you face any of the problems listed here in your company, contact us to discuss the company's recovery plan and further steps.

Any company can be affected by the crisis. In the event of the appearance of crisis situation appropriate steps must be taken as soon as possible to minimize the negative effects of the situation and save the company, in some cases even from collapse. Remedial proceedings should be based on a sound, carefully prepared plan. The better the activities are planned, the greater the chances that the entire project will be successful.

The recovery plan of the enterprise is a document specifying the actions taken by the entrepreneur and the implemented procedures that are to lead to the improvement of the situation of his company in crisis. A recovery plan can help, for example, in the event of a loss of financial liquidity or other problems related to the company's finances. On the other hand sales recovery plan can help implement appropriate solutions in this area.

Preparation of a recovery plan is a complex process that requires appropriate skills, extensive knowledge of repair procedures and excellent knowledge of the market. What data should be included in the document?

Recovery plan - summary

The first pages of the company's recovery plan should describe the company's current situation. Then, the remedial strategy is described, detailing all the problems that the company is struggling with, along with suggestions for solving them. The plan should also include:

• information about the risks associated with corrective actions,
• costs related to the implementation of corrective actions, as well as a description of the methods and sources of financing,
• schedule and deadline for implementation of corrective measures,
• the desired results, i.e. what effects the plan is supposed to bring.

A recovery plan must be prepared in writing. The key to success is constant monitoring of the situation and analysis of all activities. Drawing conclusions from the situation and implementing appropriate solutions will save the company from a possible future crisis.