It's only natural to want to "wait it out" when it comes to your business during a crisis like COVID-19, but there are 5 areas you should address now to come out better on the other side.
Last week, McKinsey released their executive briefing on the Coronavirus pandemic--which included some areas of impact where organizations should take action if they want to be resilient. As a business owner, it's important to accept that things have changed and to chart a new path forward. While healthcare workers are doing their best to safeguard our lives, you need to safeguard your livelihood. Read on for a practical action plan.
If you look historically at the types of companies that survived a recession, there are two qualities they all share: speed of response and discipline of approach.
Here's where you can start.
Address the 5-fold Business Impact of this Pandemic
COVID-19 has created unprecedented liquidity, social and mental challenges for businesses. Now is the time to act quickly and make hard decisions. The areas to address impact are:
- Your employees-their safety, ability to work and maintain employment, and their overall stress.
- Your customers-their concerns and possibly a sudden sharp decline in demand for your services.
- Your current available cash-revenue will drop, what is your current liquidity situation and how will it be affected over a prolonged recession?
- Your supply chain-how will on-going logistical issues beyond your control impact your supply?
- Your technology-are you set up to sustain operations and support remote workers?
Support Your Workforce
Social distancing guidelines, health concerns, and new working conditions are driving employee stress levels to dangerous highs.
Here are some ways to alleviate worker stress and encourage productivity. (The links in this section are for organizations already using Office 365, if you need to get started on Office 365 contact us.)
Restructure Remote Teams - You might have been more of a top-down organization before the pandemic started, but smaller, cross-networked teams excel better in remote environments. Tools like Slack and Zoom or Teams makes it easy to organize these remote groups and keep them communicating effectively. The key here is communication and streamlined access to information. Here are 3 success tips:
1. Clearly define preferred communication channels (like video chat) and post desired outcomes.
3. Revisit your company culture and discuss it openly with your workforce. This is the time to show those values you've talked about ("we're like family here.") Encourage your workers to remain professional in remote situations, from appearance on video to transparency of their work schedule and assigned tasks.
4. If workers must go on-site, encourage disciplined social distancing, stagger schedules and take all possible precautions to limit employee exposure.
Protect Valuable Customers
Build lists to prioritize customer response. Create customer segments for: highest margin, longest continuous, biggest immediate needs, and contractual obligations.
Reach out to customers to see how they are doing and offer your advice, help, and support where possible. By communicating more with customers you'll learn what's important to them right now.
Review your marketing and toss out any canned emails or advertising that doesn't address customers with transparency and acknowledgement of the current situation. Adopt a "We're in this together" tone. Work with your sales and marketing teams to create a rhythm of updates and engagements that contains high-value content you can offer for free or at a reduced cost.
Think of leading with your value right now over a high pressure sales approach, acknowledging your vulnerability at this time will not be seen as weakness, but instead will motivate your "champion" customers to support you more.
Cash is King During a Crisis
Get your leadership team together and find some immediate low-risk actions you can take to improve your cash position.
- Every department has waste somewhere--whether it's a monthly subscription they're no longer using or redundant software. Encourage managers to make thorough audits of expenses, on-going project budgets, and voluntary spending.
- Run a rolling 13-week (or less) cash forecast. Create a best and worst-case scenario for all financial forecasts.
- Monetize non-revenue generating items if possible and liquidate assets where it makes sense to do so.
- If you're currently in an unsustainable position, consider applying for a low-interest disaster loan from the Small Business Administration.
This is Part 1 of a 2 Part Blog Series. Part 2 Covers Supply Chain and Technology .