Welcome to 2019!
This year promises to be dramatic for UK Business.
Firstly, to kick things off the Political Pantomime that is Westminster reconvenes on 8 January.
Secondly, the Meaningful Vote takes place no later than 21st January. As things currently stands the government’s Brexit plan will be rejected. Basically, because there has been no movement since Parliament went into recess before Christmas.
Unfortunately, for UK business, a Governement defeat will prolong and exacerbate uncertainty. What business needs right now is certainty at the very least over the direction of travel.
Naturally, that direction has to be credible. Therefore, stating that the choice is between the Government Deal, No Deal or No Brexit paints three vastly different scenarios. There are a whole raft of other alternative forms of leaving but as of this moment none are on the table.
Uncertainty Creates Opportunity
In most circumstances, we would agree with the above statement. Unfortunately, in this case there is a huge range of possible outcomes. To make matters worse, the range of outcomes create vastly different visions of the way forward.
Outside of Westminster, with more information now available regarding leave, the Remain bloc is clamouring for a second referendum. Within Westminster, at present only backbenchers and occasionally a minister, are suggesting this as a way out from a painful parliamentary choice.
In conversations with family and friends we think people have mainly got entrenched positions from the 2016 referendum so the outcome will not be vastly different and potentially as divisive as the last referendum. Possibly, with demographic changes and some switching the result may now switch 52-48 the opposite way.
Alternatively, if Article 50 is not stopped then a No Deal Brexit becomes an increasing reality. Unfortunately, a No-deal Brexit is viewed by many as a cliff edge. In fairness within the public sector there is a significant amount of No-deal planning being undertaken. Unfortunately, some of it politically embarassing such as the £13m ferry contract let to a company with no ships.
Government forecasts and those of independent think tanks indicate a No Deal Brexit is the least desirable outcome for UK plc but they are mitigating that impact with planning. The Bank of England has planned for each scenario.
What Can You Do?
As a business your business cannot tread water until this decision is made. Unfortunately, lots of businesses have delayed business decisions looking for a clear direction of travel. This business paralysis will suffocate entrepreneurial spirit.
Therefore, as per the Bank of England, we can plan for each circumstance and adjust variables and revisit plans as and when more data becomes available. Whilst the Bank has to consider the entire economy for its planning, you have to consider your business and potentially any personal impacts that will impact your business.
Forecasters are used to making estimates of possible outcomes based on imperfect information occasionally they get it wrong such as Michael Fish and the hurricane / storm in 1987. Generally, however, they are not far off and revise forecasts as more data becomes available.
Elsewhere, military planners are foreced to plan without knowing what the enemy are doing. Generally however a military campaign proceeds and is adjsusted as more intelligence is gather and more information becomes known.
In the world of business we can do this via scenario planning. Assuming that one of the Brexit outcomes has occurred aad therefore adapting the business accordingly. By making use of scenario planning, you can make your business a little more Brexit ready and thus able to take advantage of the opportunities each scenario presents. We can supply the information that is available to date and can help you as more data becomes available.
Talk to us and together we will make you stronger.