Crises come in many different forms, but none can be more challenging than Covid-19. Consumers sheltering at home have brought retail sales down close to zero. Restaurants, cafes and bars and other service businesses are operating a strictly limited service. Only e-commerce stands out as a sector showing positive signs of life.
With so little economic activity, it is no surprise that Asian SMEs are struggling. In many sectors, the supply chain has stalled and no-one knows when new orders will arrive. Revenue flow has slowed to a trickle. But expenses like rent, salaries and operational overheads still need to be paid.
It’s hard to remember such a deep recession affecting large swathes of the economy. So it is no surprise that CEOs are lost for a solution. Here are some tips on moving beyond survival mode during Covid-19 and preparing for future growth.
In a crisis – stay calm and focused
When facing a crisis of this magnitude, emotion must be put to one side and an objective assessment made of the business situation.
Once a clear understanding has been achieved, company CEOs need to identify the best way forward. Thus, considering all the available options.
To put things in perspective, it is important to recognise that shocks happen every few years. This is part of a normal economic cycle. Difficult circumstances come to an end and a general recovery takes place.
With this in mind, organisations need to look positively to the future. Prepare for 4-6 months down the road when they can anticipate a time of renewal.
Plan… Plan… Plan
During a slowdown, more time is available to engage in the planning process. Make the most of this opportunity to prepare for the next growth stage.
Start by reviewing the organisation and its core objectives. Build a deeper understanding of the current state of the market and set new goals.
Focus on people – your team is crucial for future success and surviving the crisis
Every company needs to minimise expenses during the pandemic. However, you should take care not to reduce headcount too far.
Keep your team comfortable by reinforcing your own confidence and beliefs. As a company leader, you need to take the business forward with conviction.
A steely determination and the power of conviction are required to persuade team members to stand by you during this difficult time.
It is essential to keep your core staff on board ready to move as fast as possible. Thus, making the most of new opportunities ahead of less well-prepared competitors.
The ideal approach seeks to avoid lay-offs while minimising over-spending. Options include staff furloughs (temporary layoffs on full or partial salary). For example, agree on pay cuts and pay deferrals with partial or full repayment in company stock. Furthermore, customised solutions that are negotiated one-on-one to address personal needs and concerns.
Maintain regular communication with your key audience
During the crisis, communicate frequently with team members, clients and business partners. By demonstrating clear business objectives companies can stay relevant throughout the crisis. Thus, a focused strategy and a determination to survive can help into the post-Covid-19 era.
By keeping multiple channels open for dialogue, you will be able to address issues as and when they arise. Furthermore, you will successfully stand out from less well-organised rivals.
Focus on innovation as the way forward
In just a few short months, Covid-19 has created a major threat to the existence of many organisations. CEOs are increasingly aware of the need to change their current business model.
Covid-19 survivors will need to be innovative. They are required to adapt and build new momentum in an uncertain future. The biggest risk is trying to maintain the old status quo. Thus, thinking that there will be a return to business as usual.
There is a narrow window for innovation right now. Rapid action is required in the few short months before economic renewal.
Digitisation – remodelling for future growth
Consumers have responded to Covid-19 by changing their habits and working patterns. Companies need to adjust by shifting towards a more digital lifestyle. Now more than ever before, excellent customer service can help your company stand out from the crowd.
Organizations with a traditional business model can turn to digitisation. As a growth opportunity to improve its market approach across multiple channels.
Even businesses that are already operating online need to expand their activity. Thus, expect a greater level of competition as more rivals enter the digital world.
Digitisation can help to transform and expand future’ s company’s business operations. However, this process requires a full team effort. Hence, it takes a determined commitment that starts with the CEO.
For a more in-depth look at the process and benefits of company digitisation, please click here.
Make organisational changes to reflect the new normal
New social and business realities are likely to remain in force as Covid-19 recedes. Organisations should embrace these changes. So that all team members feel comfortable in the office environment.
Updates include social distancing and the provision of sanitation material. The position of desks, the usage of meeting rooms and access to lifts. Nonetheless, policies on food management in the office are also important.
Flexible working should become a more acceptable option. Companies should provide staff access to laptops and software necessary to work outside the office. However, do make sure that business confidentially and data privacy are handled effectively.
Business 101 – ensuring stable finances
When revenue is slow during Covid-19, SME manufacturers are among the most heavily impacted. Their situation is complicated by supply chain dislocation. Besides, delays in invoice settlement by their customers.
Reduced profitability means organisations must respond fast. Hence, streamlining operational costs and identifying fundraising opportunities. More details on how to ensure cash flow discipline in such a difficult economic situation are provided in this recent blog post.
The SAR government has announced a raft of measures to help employers. For instance, measurements aimed at job retention and overcome cash flow difficulties. However, one of the best approaches is to raise cash against outstanding invoices by using an online platform.
Looking to a post-Covid future
Despite the scale of the problem, Covid-19 can be a springboard for future growth. To make this happen, CEOs must develop a clear-sighted plan. They must account for the needs of their team. Also, looking at fresh business opportunities and accounting for the potential of digitisation. There is an opportunity in every crisis and these wise words have never been more valid than they are today.
Image by Markus Winkler