COVID-19 is unlike any previous crisis; traditional ‘crisis response’ approaches will not be sufficient. What seemed like a remote concern has fast evolved into a fully-fledged climate of panic, misinformation as we all learn to live with a pervasive, omnipresent fog of fear. Aside from marked panic, it has also resulted in inescapable uncertainty in all spheres of life, with businesses affected by either panic buying or absence of customers, along with worry affecting staff morale.
Prepare for the worst, and be thankful if it doesn’t eventuate; a ‘wait and see’ approach is a non-starter. As a Business leader, it’s critical for you to be out in front with a planned cascade of possible actions based on which scenarios unfold, likely more aggressive than your team can imagine right now
The panic and misinformation are unhelpful to business leaders who are making critical decisions that can affect hundreds and potentially thousands of people’s livelihood and wellbeing. There is a new “norm” every few days. In business, planning and preparation are key. Over these past weeks, it has been hard to disseminate all of the information at hand in such a short space of time and make the right decisions especially when the decisions can be so pivotal.
Full shutdowns may sound good – but in practice, we believe it will be a disaster. How will you respond? We need to understand that the DHHS has the processes in place to manage the spread and unless directed by the DHHS, business owners should and must do their best to keep operating, especially those in essential services.
There is a high likelihood of a substantial revenue disruption, leading to a potential liquidity crisis for many. The recovery may not be a quick ‘bounce back’, plan for multiple quarters of lower revenue.
But times of uncertainty are not without opportunity for both leadership and the company’s success, with the following 11 steps outlining how you are a business owner or company CEO can ensure your business continues to operate throughout any period of uncertainty, without a lot of sacrifices.
1. Keep Communicating
We have very little precedent for current circumstances, and for many businesses, current processes won’t address the prevailing situation. As under most circumstances – usual or unusual – communicating is key. Keep communicating with your employees, your suppliers, business stakeholders, your customers, and the communities you operate in. An obvious point, but a necessary one to emphasise right now is communication but you must plan as if someone will get COVID-19 in your business. You also need to adapt your communication to the circumstances; it’s quite possible you now have most or all of your employees working from home, and how you communicate – and what you communicate – needs to be adjusted accordingly so that everyone receives the same information.
When it comes to communicating with your employees, make sure this happens daily and includes information about what is currently happening in the business. Good or bad, be honest and transparent in letting them know about changes, from sales or revenue, through to how future plans are being updated, and anything that could impact the business – and by extension – your employees.
Keep your customers informed about what is happening, and not just your usual customer messaging. Include information about measures you have put in place, or changes you are having to implement that could affect your customers, be it changes in business hours, new health and safety measures being put in place, changes in delivery timeframes, and if everyone is now working from home, how you customers can still contact you. On a side note: many businesses pre-schedule social media posts days or weeks in advance, so remember to work through all your coming social media posts to ensure they’re all still relevant, while at the same time introducing new posts relating to current circumstances. There is always the risk of some scheduled posts now being inappropriate, while others might not account for any recent changes you have had to implement. And be prepared for more customers using social media platforms to communicate with you during this time.
You might be used to only communicating with your employees, customers, and even your suppliers on a weekly or as-needed basis, but this has to change to daily communication because the current situation is volatile with circumstances changing daily. Communicating with your suppliers daily not only keeps the relationship alive, but it is also an opportunity for you to alert them of any changes to your business, and similarly for them to alert you of changes to their business that could affect you.
Whatever has worked for you in the past needs to be looked at with a critical eye, assessing what needs to change in terms of communication, and how it is going to change.
2. Remain Confident and Look for Opportunities
In moments of uncertainty, giving in to worry and negativity is all too easy. (I have gone through this stage). And when we say remain confident, we aren’t suggesting you ignore what is happening around you. You need to be aware of the situation – and the changes that follow – but you also need to look for opportunities, you may have to pivot your whole business. There might not be any immediate opportunities, but by being aware of how the current situation is going to reshape customer behaviour, the markets, and various other factors, you can identify opportunities that can benefit your company now or in the future and adapt to take advantage of these immediately. The knock-on effect of this – when combined with honest and transparent communication with your employees – is to help them remain optimistic in uncertain times. All industries are being affected by the current situation, but for some the impact is more positive than for others. Opportunities might exist for you to help out the industries that are still performing through this all, even if it normally falls outside of your area.
3. Understand the Cycles of Business
As in nature, there are cycles in business and the economy: summer is a time of growth, autumn sees growth slowing through to being stagnant – not dead – in winter, and spring sees things starting to improve again. Many businesses have had a great, almost endless summer, and while the transition to autumn is usually slower, allowing you to adapt to growth slowing more easily, the current situation saw autumn hit almost overnight. In some industries, there was no autumn and they already find themselves in winter, but by remaining confident and looking for opportunities, your business can get through this period of limited to no growth. To keep on top of the situation as it is dynamic, to say the least use tools like google trends. Google trends may provide you a view and ability to adapt to the new norm, which is changing every few days. How long autumn and winter last before you’re back in the spring cycle depends on many elements but primarily your actions today: how you lead your company and your employees through it all, how you communicate, and how resolute you are at looking for opportunity. And don’t be reluctant to pivot your business if that is what it is going to take to hasten the return of spring. The Australian Government is not going to press you for money, even some suppliers, take advantage of this cash flow respite and pivot if needed. If all staff need a 20% pay reduction to survive, don’t wait, try and make it happen now.
4. Take Action Now
Inaction is another common response to moments of great uncertainty, with people – and companies – adopting a wait and see mindset. And the more volatile a situation is, the longer the wait and see mindset stays in place, to the point where any eventual action happens too late, if at all. What is happening this week is radically different to what was happening last week, which is also far removed from what was happening in the middle of February. And if you haven’t started taking action already, you would see that in the state of your business now versus earlier this year, and possibly in your level of enthusiasm or determination to push through.
Some action you will need to take – the changes you will need to make to your business – are going to be unpleasant, but if they are necessary to ensure your business continues, then they need to be taken now. Part of what motivates a wait and see mindset are what-if scenarios: what if things suddenly improve next week? Unfortunately, there are innumerable possibilities, with no way of knowing which one is more feasible or likely, but any tough action you take to keep your company going is never wrong if your business survives the current situation.
Control the controllables, dont stress about factors you cannot control. To assist our staff and clients we are prototyping a free mobile App – which all staff and clients will be able to download to their phones. If phones with the App installed get within 2 meters of each other the phone alarm will buzz. This is one method we can control and deploy to more formally implement social distancing advice from the Government. We have also seen a steep rise in customer queries online relating to a business’s status, open or not open?. So another step we have taken is offer a free service to not only our clients but anyone who reaches out for website changes so they can communicate to the public via the digital assets their response to COVID-19. We re-iterate believe open and honest communication is critical in these times. As examples DrummondGolf, HypeDC and Adams Pest Control.
5. Reduce Spending Wisely
The smart response to revenue or sales declining is to cut costs. The wise response is to cut unnecessary costs, not all costs. Certain costs are necessary for growth, so you need to evaluate all your expenses and decide which are necessary and which are inessential under current conditions. Cut back or delay inessential expenses by renegotiating terms and contracts if possible and delaying anything that was planned but isn’t going to contribute to growth right now. Leaving aside COVID-19 the decent of the Australian Dollar is going to make many businesses marginal overnight.
Marketing is critical during this time, so don’t cut back on marketing expenses, though you might need to look at what marketing is planned and reposition some of it. Trade shows, seminars, and being involved with other big events is of little value if these are being canceled, or are not going to attract a lot of attention right now, but what you would have spent there could be allocated to other forms of marketing that will benefit your business right now. Most Ad campaigns running now are pre COVID-19 and have little relevance to consumers.
6. Don’t Hesitate to Seek Out Credit
Don’t be reluctant to get finance while financial institutions are still offering it, and while you are still in a position to secure it. You might not need it now, but that could change quickly, and it is remains one of those things that is better to have and not need, than to need and not have. Having access to credit can make it easier for you to take action, make tough decisions, and even pivot the business if absolutely necessary for survival.
While not an actual credit line, the Australian Taxation Office has already announced a stimulus package in response to the economic repercussions of the COVID-19 coronavirus, which includes tax measures. One of these includes taxpayers being able to defer payments of tax due through BAS, income tax assessments, FBT assessments, and excise duties (including PAYG installments) by up to four months. This is not automatic, but taxpayers can contact the ATO through their COVID-19 Emergency Hotline (1800 806 218) to see if they are eligible for an assistance package.
7. Evaluate Staffing Opportunities
In some industries, retrenchment during the current situation will be unavoidable, but if this doesn’t apply to your business you can still find opportunities within your staffing that will help your company survive. Encouraging staff to take accumulated leave might not save you many costs, but it is preferable to having staff sitting around with nothing to do. Ways to reduce staffing costs without retrenching include cutting back on overtime – which would be easy if your company isn’t as business as usual – switching some full-time positions to part-time positions, not filling any non-essential roles that are currently vacant or become vacant when one of your employees leaves, and freezing increases and bonuses temporarily.
Aaron Dearden, Fay Calderone and Alex Armstrong-Millar of Hall & Wilcox have also put together a list of cost-saving options available to employers that are permissible in terms of Australian employment regulations. As noted earlier, some casualties might be unavoidable, but losing five or ten employees to ensure the business survives and another 30 employees remain employed is better than the alternative.
8. Plan for Work From Home Periods
If you haven’t already done so, start putting together a plan for some or all of your employees to be able to work from home. Some cities and countries have already gone into lock-down or promoted a shelter in place policy, meaning nobody gets to leave their home except under special circumstances. Having a policy or plan for work from home periods means your business can continue with minimal interruption, with the plan not only ensuring that everyone has the technology and tools necessary to do their job from home, but that meetings, customer service, and general communication are also planned for and continue with minimal disruption. Not all businesses or industries can have all staff continue to work even from home, but some roles can continue and should be planned for and even encouraged now ahead of any possible lock-downs or shelter in place orders.
9. Offer Deliveries Only
If you have a physical store and suddenly are faced with no customers coming in, it doesn’t necessarily mean they don’t have a need for your products at this time, merely that they are reluctant to go out. You could keep some of your staff working through this and continue to make sales by switching to taking online orders only, with free, same-day delivery offered in locations where you have a physical store. The same applies to restaurants in locations where they haven’t been ordered closed but are still not seating enough – or any – customers. Keep the kitchen open, but only for delivery or collection orders. These are unorthodox approaches, but they are one way to keep the business alive and keep some of your staff working. But it also depends on you being able to take action quickly, to have the appropriate packaging needed, and to have ways of being able to deliver yourself if you have previously relied on the postal service or other delivery providers.
But doing so also depends on your ability to effectively communicate these changes to your customers before they switch to competitors already offering these options.
10. Don’t Lose Your Existing Customers
Leading on from the last point, retaining customers is always better – and more affordable – than attracting new customers. And this is especially true in times of uncertainty. Don’t stop efforts to grow your customer base, but you can consider scaling them back, so you have extra resources available to retain your existing customers. Communicate with them directly on what you are doing during this time, steps you are taking to keep them safe while still benefiting from the products or services you offer. There are some services and some products customers can do without during the current global situation, but not everything is affected. And if you aren’t making it possible for your customers to still get their products or services from you, and letting them know that they still can, they will go elsewhere. Do whatever you can to prevent this. Offer bulk deals and other special offers when there is the chance of a reduced need for what you provide; offer real value, but without neglecting to make sure they know about it, and that you are still available to them.
11. Don’t Lose Your Humanity
Some people are angry, some depressed, many anxious, most are unsettled, we have never been here before. It is critical to act practically with the best information at hand, and with calmness and logic. You are surrounded by uncertainty – even panic – kindness, compassion, and common-sense are in short supply. Remain aware of the importance of these characteristics in the way you do business, engage with your family, friends, employees, and customers, and respond to changes around you. Under normal circumstances, a big part of what you do involves listening to your customers, and this should continue. We encourage you to take action, to adapt the way you do things, and this is important at this time, but it shouldn’t take place without also listening and responding to your customers. Tell them what steps you are taking, what changes you are making, but pay attention to how they respond to this and adjust your steps and actions accordingly. Things will improve, and your customers will remember how you reacted and how you treated them – make sure it was always positive.