How to Secure Your Business From Single Points of Failure (Facebook Be Thy Teacher)

Businesses and entire economies are riddled with single points of failure.

The pandemic exposed an over-reliance on Chinese manufactured goods. The massive cargo ship cost the global supply chain over $400 million an hour. Facebook lost $79m in ad revenue in less than 8-hours, but untold amounts for the companies who rely on these ads to fuel their business.

Threats are everywhere.

Single points of failure will cripple your business.

A single point of failure (SPoF) is a problem that leads to the shut down of a company’s source of revenue.

The past two years have delivered informative lessons. It has been a teacher and executioner on how fragile global supply chains are when one action creates an adverse reaction throughout the world.

But it’s not only the big, huge, hairy, scary lessons that matter.

For small businesses, it’s also the one customer who generates 70% of the revenue, the one supplier who provides all of the inventory, and the one employee that would cripple the company if they left.

A SPoF can come from an economic catastrophe or a simple error of putting all your business eggs in one revenue-generating basket.

Push back your threats quarterly.

It’s hard to predict an event like the pandemic or a massive cargo ship blocking one of the busiest canals in the world.

But there are many things a business can do every quarter to limit the impact of near-term threats. One example is having too few customers or suppliers. These threats are visible.

Every quarter, ask yourself, “What is one threat we must mitigate this quarter?”

When you identify the threat, spend the quarter pushing it back.

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