Market Uncertainty and the Role of the Board

 By Sarah Morrison

Sarah Morrison is an entrepreneur, chemical engineer and former strategy executive with over 10 years experience in banking, insurance, management consulting, oil and gas, and capital intensive industries. She is an experienced leader known for building high-performing teams and driving growth and innovation.

What is the #1 topic on CEOs' minds right now? For many, it is market uncertainty fueled by geopolitical tensions and their ripple effects, including fluctuating tariffs.

Boards have a requirement to help chart the course, but how?

There's no one-size-fits-all approach, but one thing is clear: regulations, market conditions, and geopolitical tensions remain volatile and unpredictable. This amplifies the need for agility and informed board guidance.

This article addresses the immediate tactical steps to take (step 1) when facing uncertainty, then looks at how to navigate both sides of the strategic equation: revenue diversification (step 2) and cost resilience (step 3). While this largely takes a financial lens, there is something far more important at the core that leadership must prioritize above all. Businesses that stay close to their customers, who understand their needs and deliver real value, are the ones that come out ahead.

While volatility gets headlines, it’s not new. Most companies today already operate with a layer of built-in resilience, born from years of navigating shifting markets, accelerated technology capability and disruption, and evolving customer expectations. 

In the face of uncertainty, the playbook isn’t to panic but to evolve. Strategic diversification isn’t a separate tactic. It builds on existing strengths and sharpens the edge companies already have.

It's helpful to remember that even as the business environment changes, not everything does. Despite the noise, a few things remain certain:

• Customers still want products that are reliable, affordable, and delivered easily and quickly.
• In complex or high-risk environments, trust, relationships and reliability matter.
• Companies that combine operational efficiency with a deep understanding of their customers will remain competitive.

Let’s get into what your board and management can do. Below is a helpful visual to keep in mind:

Step 1: Immediate Actions

When volatility spikes, the board’s first job is to pin-point the pressure points. There are five checks to work through initially:

1. Exposure analysis: Take stock of current exposure across product lines, regions, customer base, and suppliers. Identify areas where more than 30% of revenue or supply is coming from a single source. This is your concentration risk. Then apply the 80/20 rule to spot the 20% of products, customers or suppliers that drive 80% of your risk or revenue. These are the areas that need immediate review.

2. Supplier map:  Identify suppliers operating in regions or sectors most likely to be impacted by the uncertainty (for example geographically impacted). For each critical product/supplier, note where it comes from, the lead time to switch, and the best backup option if needed. 

3. Customer map: Identify key customers most likely to be impacted. Ask: What is likely to happen to their purchase patterns? What is our likely revenue risk? What can we do to support these customers?

4. Scenario playbooks: Model out best-case, worst-case, and likely-case scenarios. Quantify the financial impact of each scenario on key products and suppliers. Then outline the specific moves management will make in each situation, so the company doesn’t freeze if the worst happens.

5. Threshold triggers: As a board, define hard triggers: for example, if more than X% of margin is impacted by tariffs or if delivery timelines slip past Y days, what are the decision points and our response plans? These thresholds can prompt an automatic board review and save the organization from a scramble.

Step 2: Diversify the Revenue Side

Long-term resilience comes from widening the top line, not just defending it. This is where the boards focus should be once the business is stabilized. 

As uncertainty rises, customers want clarity and reliability. Confirm your intended value proposition and make sure your positioning reflects responsiveness, trust, and flexibility, not just low prices or product specifications. Analyze your customer mix. Are you over-reliant on one industry, demographic or buyer type? 

Then look for adjacent customer segments or industries you can reach with minor tweaks to existing products. Consider launching one or two micro-pilots in the next 30–60 days to test demand with clearly defined benchmarks such as sales, lead generation, and/or margin. Throughout, sharpen the value proposition so it aligns with customer needs. If overseas growth is on the table, rank target markets with a simple risk-and-reward scorecard and enter the single best fit rather than spreading resources thin. Design market entry strategies that align with your strategy, the target markets, your risk appetite, and the size of the opportunity. Establish contingency plans and be prepared to pivot.

Step 3: Tackle the Cost Side Intelligently

Any cost-cutting decisions should be deliberate and strategic, not a knee-jerk reaction. The focus should be on creating structural resilience rather than cutting corners.

Cost resilience starts with supply chain resilience, including reducing over-reliance on single suppliers as well as supplier consolidation where appropriate. Forward-thinking companies build deep relationships with strategic suppliers, enhancing transparency and mutual resilience. In addition to supplier optimization, explore where you are geographically exposed and consider regional sourcing options to hedge against distant disruption. The challenge is balancing cost efficiency with resilience, recognizing that sometimes the more economic option creates greater exposure.

Building operational flexibility also means creating variable cost structures through contractors, leased equipment, and flexible partnerships. This allows organizations to quickly shift resources between markets, operations and products as conditions change.

Cost resilience also includes investing in automation and/or digital capability selectively. Not every technology investment is worth it. But strategic automation can reduce long-term exposure to labor cost spikes or slowdowns in specific regions.

Certainty is a Myth, Clarity is a Strategy

Tariffs, regulation shifts, political headwinds… none of this is going away.

A real test of a company’s strategy and business model is during a crisis or uncertainty. This is also the best opportunity to strengthen the business, make it more resilient and create long term opportunity. It is also one of the best opportunities to strengthen your winning strategy.

The smartest companies aren’t waiting for the dust to settle. They’re creating clarity inside the storm.