Doing Business by the Good Book Ch 36

Contingency Planning in Business and Life

• God's contingency plan for Adam & Eve's "original sin" involved work and eventual return to dust
• A business contingency plan can alter a company's trajectory significantly
• The author's company initially audited railroad companies, later expanded to undercharges, then diversified into a broader IT services for various businesses.
• The company adapted its technology, transitioning from standard accounting software to enterprise resource planning (ERP) systems
• This adaptation allowed the company to anticipate customer needs better than competitors
• A diversified customer base is essential. This avoids over-reliance on any one sector or industry
• Diversifying clients includes Fortune 500 companies and the federal government (e.g., DoD).

Contingency Planning in Government Contracts

• Companies must adjust to government procedures for contracts
• Government contracting involves continual adaptation to changes in procedures and regulations
• The author's company, with its systems capable of handling government data, serves several government agencies like the CIA and DOD
• This is a worthwhile market segment in terms of volume, yet demands flexibility with the always changing government rules and regulations

Contingency Planning for Data Security and Business Continuity

• Routine data backups are part of a contingency plan. Every night, their data is backed up—an offsite backup is also part of their plan.
• Internal and external factors can trigger contingency plans.
• Internal factors include staff turnover, accounting restatements, etc.
• External factors include acts of war, terrorism, policy changes, major customer loss, economic changes, and competition.

Contingency Planning in Biblical Examples

• Joseph's interpretation of Pharaoh's dreams provided a contingency plan for Egypt during future famine.
• This involved storing grain during plentiful years for lean years
• Joseph's wisdom and foresight saved Egypt from famine
• Throughout the Bible, contingency plans are depicted.
• The "old covenant" (with rigid laws) contrasts with the flexible "new covenant" (faith-based)

Contingency Planning for Long-Term Success

• Companies that don't prepare for changes often react with drastic cost-cutting measures—a counterproductive strategy.
• Such reactive measures often stunt future growth and can cause the company's slow demise.
• Avoiding over-reliance on one industry is key; the author's company has diversified its clientele to avoid that trap
• Companies should invest in growth and anticipate changes during good times, instead of cutting costs when things are difficult.