Brexit is one of the most remarkable events in recent European history, marking the first time that an EU member state has decided to leave the bloc. Further to important implications for European integration, Brexit has begun a significant period of uncertainty that spans a wide range of issues. These include the rules that govern the UK’s trade with the EU and the rest of the world, the rights of EU workers in the UK and vice versa, and the resilience of the UK economy.

No one knows what the UK is going to be like when we wake up on the 1st November 2019. Will there be new opportunities? Currency fluctuations? Loss of jobs or job opportunities? or political crisis? The scenarios can be predicted, and organisations must be prepared for anything and everything.

Free movement of labour, goods, services and capital: The unpredictability of the government’s future deal makes it difficult for companies to create a new model or align their current business model to maximise capabilities.

Talent management: Businesses may find it difficult to hire skilled labour, meaning HR and recruiting offices need to rethink their strategy for labour resource planning.

Regulations: Depending on the type of organisation, there may be different challenges from the regulatory changes after Brexit. Organisations need to understand how shifts in such regulations will affect them and prepare for the consequences.

Relocating operations: Airbus and BMW have recently warned that they may relocate their operating locations if there is no proper Brexit deal. This would cost the UK tens of thousands of jobs.

Uncertainty: If the UK and the EU cannot come to an agreement that allows the continuation of cross-border business passports, then organisations will need to rethink their business strategy and architecture.

Of course, these are just a few – although some of the most important – areas that organisations must consider in the countdown to Brexit. However, time is fast running out and firms need to start preparing and putting contingency plans in place.

There are three scenarios that you need to plan for: No Deal, Hard Brexit and Soft Brexit. Here’s what they mean for your business:

No Deal: No Standardsation or regulatory framework and no free movement of labour, goods, services and capital, no trade agreements, no transition period.

Hard Brexit: Restrictions on movement of labour, goods, services and capital, divergence on standardisation and regulatory framework, transition period.

Soft Brexit: Flexibility on free movement of labour, goods, services and capital, and restrictions on standardisation and regulatory framework, transition period.

When developing your scenario response plans, these are the six things to consider:

1. Coherent Brexit strategy: A strategy needs to be developed that encompasses the probable scenarios and has contingency plans for critical trigger events (ie regulatory, legislation or trade deal changes). This strategy needs to align with all inflight and future programmes so that organisations can avoid any threats to themselves or capitalise on any opportunities. To achieve this, business analysis and programme delivery teams need to be forceful and robust to ensure that you can identify issues and ensure good returns on investments
2. Advisory team on Brexit with the authority to act: Your organisation needs to work through the Brexit scenarios to see the potential impact on your business and become clear on where you need to strengthen. Once you’ve listed down the different scenarios, build a Plan capturing all the scenarios and actions. This plan may change as the UK negotiates with the EU. Hence, an agile approach to this plan is very important. You need to build a team within your organisation that has advisory knowledge on Brexit
3. Business model: Will the Post-Brexit changes affect the way the current Business Model adds value to the Organisation? If the answer is Yes, then an assessment must be carried out to see what areas in the current Business model need change. List down the existing clients, businesses and suppliers in the EU as well as any Subsidiaries and Counter parties that these businesses have. This would give you an idea of which entities may change and thus will help you build a new Business Model that focuses on the long-term strategy
4. Operating model: You will again need to complete an assessment of your current operating model. A few helpful questions are: Will you be required to buy any new resources and build new capabilities? Based on the changes to the Jurisdictions, do we have to move specific entities to align with the new Jurisdictions? These new models based on the response to these questions and others will help your organisation react faster to the challenges posed by Brexit
5. Financial model: Based on the revised Operating and Business models, it is very important that you capture possible ways to analyse capital, project funding, etc.
6. PMOs and Project Managers: Projects and programmes need to be reviewed and have impact assessments completed to identify the potential risks of Brexit, and to assess their continued viability. These reviews need to go beyond internal assessments and must include implications for customers, suppliers and partner

Brexit is fast approaching, especially if you consider the increasing likelihood of a no deal scenario with no transition period. Even with the transition periods companies may be expected to comply/trade with multiple markets and regulatory frameworks right away. Your organisation needs to set achievable timelines for your Brexit strategy, so you need to start right away.

In a nut shell

Brexit is surrounded by so much hearsay, conjecture, and political instability that it is impossible to know what the business climate will be in 5 years’ time. However, organisations need to be aware that all these uncertainties present opportunities as well as risks. At such a crucial time in the country’s formation of its socioeconomic and political make up, being on the front foot is essential to an organisations’ future. To do this, an organisations’ approach to transformational change needs to be robust and active allowing it to mitigate any risks and capitalise on any opportunities.

To find out more about our Brexit Solution and how we can help your business prepare for all outcomes get in touch today.