Brexit: The ‘Known Unknown’
Blog: Mark Chadwick
Many astronaughts employed by NASA (National Aeronautics and Space Administration) regularly contemplate the notion of “Known Knowns” and “Known Unknowns.”
As the Brexit train threatens to come crashing to the end of its journey without even knowing where its destination is, the relevance of this theory actually becomes ever more alarming. We know there will be some form of a deal, a no deal is still a deal as we’re often told, but the outcome of the deal still remains unknown.
So how do we plan for a “known unknown” Brexit?
Talking to UK Businesses
Our public procurement whitepaper – in partnership with the Chartered Institute of Procurement and Supply - has captured the thoughts of 45+ organisations across the UK and shone a spotlight on the key issues and concerns that are important to them in the run up to Brexit.
Our conversations have highlighted that the ability to strategically plan and carry out risk assessments is our critical friend – sadly we don’t have a crystal ball, but playing out the outcomes of various scenarios keeps us away from the back foot as much as possible.
So What Did Our Research Tell Us?
Key themes from our research focused on:
A Potential Skills Shortage
We know that currency fluctuations, supply chain risk and loss of funding from EU grants are just some of the challenges faced as a result of Brexit. But a potential skills shortage has been flagged as a serious area of concern, especially for businesses working in the construction industry.
Some migrant workers may leave, and, within the UK, there may be an exodus of skilled workers in the north down to the south – but it’s difficult to predict. However, what we can do is think about the ways in which we can create and sustain the workforces of the future – this can range from delivering training and employment outcomes through planning or procurement contracts to offering apprenticeships and supporting the unemployed to get back into work.
The organisations who participated in our research raised supply chain engagement as an area for concern. It’s clear there is a need to open the lines of communication given the current climate, investing time to ensure supply chains understand organisational drivers.
The level of uncertainty around Brexit is creating an impact on market conditions and subsequently influencing costs. It's important to take time to understand if suppliers have got genuine cost pressures they can’t absorb. That’s why maintaining regular contact – in addition to understanding market data, is critical in being able to position positive negotiations with suppliers.
Creating opportunities for SMES
How could Brexit impact on the government’s aim for 33% of procurement spend to reach SMEs by 2020? For many organisations doing business with SMEs is really important and has a huge impact on local economies. To ensure we continue creating opportunities, organisations are now thinking about different approaches - from streamlining selection processes to open doors to SMEs to building lotting strategies into procurement processes so SMEs can bid for specific types of work.
So What’s Next?
From NASA’s perspective, there’s also the concept of the “Unknown Unknowns” – the things we don’t (yet) know that we don’t know. What a terrifying thought! It got me thinking, could there be further consequences of Brexit we haven’t considered?
In the meantime, yes we know the current stakes are high, but businesses have faced similar challenges and have overcome them by planning, analysing risks and responding to market changes.
At least when we finally reach the 29 March 2019 deadline, one thing is for sure – we’ll finally learn of the “Known Known!”
Click here to read Fusion21’s Public Procurement Whitepaper.