COVID-19 response
by Elias
- May 28, 2020
- 0
- Category: Accounting Advice, Business Administration, Business Advice, Business Analysis & Advice, Business Development, Business Planning, Business Psychology, Economics, Employee Motivation, Financial Analysis, Franchising, General Business Advice, Increasing your Income, Innovation, Legal Advice, Management Advice, Market Research, Marketing, Problem-Solving, Project Management, Sales, Start-up, Strategic Planning, Streamlining your Business, Target-Setting & Achieving, Task Execution Services, Taxation Advice
COVID-19 response
Every business and country are different hence any COVID-19 response approach must be customised. Nevertheless, there is a series of measures and considerations that should form the basis for any business in responding to the Coronavirus pandemic.
Generally businesses must go through the series of stages of managing the crisis (ideally with a management crisis plan in place) which should involve initial stabilisation, followed by setting out the new strategies (based on the changed environment) and finally reaching the stage of re-progressing. They must first ensure they survive, then change their strategies and finally proceed to re-bouncing into the new situation that will become the norm for the changed business circumstances due to the pandemic.
The right attitude to have is that of being ready to face the worst-case scenario with a positive and flexible mindset. Management should be expecting the unexpected because nobody truly knows with certainty how long this will last for, whether it will re-flare up and how it will evolve. The future will largely depend on the effectiveness of the medical response in attempting to constrain the spreading of the virus and on the effectiveness of governmental measures in boosting their local economies. Management must evaluate the consequences of each possible scenario and develop business forecasts for each scenario. This is not too difficult and is crucial in increasing your COVID-19 response effectiveness.
Businesses should focus on practical solutions, simplification of their processes and speed of decision-making, to address their current challenges and solve the problems that arose. But they should not neglect how the second half of year 2020 and all of year 2021 should be addressed based on the change of circumstances the pandemic has brought. In doing so, businesses should follow their local government’s guidelines and make use of any support their government is willing to offer them, whilst adjusting to the new situation and changed norms as best as possible. Overall, the short-term should focus on solving problems to ensure survival and stabilisation, whilst the medium-term should focus on the changed strategies for re-normalising and progressing.
Liquidity is the most dangerous risk right now
Almost all businesses right now are facing a shortage of cash flow following the lockdowns. Decreased profits or even losses are not as dangerous right now as a shortage of cash may be. It is a fact that most businesses end up being forced to close down due to lack of cash rather than making losses. Often, they may go bust even when making profits when cash runs out. It is therefore crucial right now for businesses to take action to increase their cash flows. Cash can be generated via better working capital management and obtaining loans from banks, or other sources. Other methods exist and they depend on each business’s nature and practical business creativity.
Another major challenge for businesses right now is the need for an unprecedented level of re-organisation of the business processes, especially in relation to human resources. The requirement mainly lies in ensuring the safety of employees and customers whilst at the same time maintaining working effectiveness of the human factor to at least moderate levels and the restricting the financial costs in not reaching unbearable levels.
If you do not increase use of technology, you are reducing your chance of survival
The correct question is: How can this be done digitally? Literally for everything you currently do, ask this question. Businesses must use as much as possible the technology and turn their trade as much as possible into a digital one. This means, simple but crucial stuff such as internal communication systems (online meetings between employees, etc) and ability to sell online. Can you still deliver your product to the purchasing customer following the impact of the pandemic? Can you sell your service completely online without the need of physical contact? If you still cannot, then make sure you make those changes that will enable you to be doing so.
Other things you should be doing
Make business decisions that will result in reduction of fixed costs, in a good communication with your existing clients, in staying well-informed on how your local government and other relevant authorities can assist your business, in safeguarding the continuity of your critical operations, etc
Obtain business advice to make the correct business adjustments during this pandemic and avoid mistakes, as mistakes will be more punishable especially during these challenging times. Such times of business crisis, often also present business opportunities that, with a bit of business open-mindedness and knowledge, can be seized and open up new possibilities.
We are here to help you
Obtain help on making the correct business decisions for protecting your business during this Coronavirus pandemic era.
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