The world is in chaos. The recent pandemic caused by the novel coronavirus isn’t just affecting the lives of millions across the globe. It is also creating a decline in economies as the virus wreaks havoc in many countries. The full extent of the pandemic’s severity is yet to be known. Government leaders and health organizations haven’t created a uniform solution to the health issue at this time. In turn, businesses are doing whatever they can to stay afloat amidst the market instability.
If you’re a business owner and need advice on how to cope with the COVID-19 crisis, or any other future crisis while minimizing losses, the following outlines a go-to strategy for when you need to respond to a global crisis.
1. Review your crisis management and response plan
Check your current business continuity plan to make sure you’re capable of handling the challenges of the issue. Can you offer remote work or relocation of operations? What are the protocols in place to reduce the effects of the crisis on your customers? Can you afford to suspend work for a specific duration while still delivering your responsibilities to both your employees and customers? Do you need a team of specialists to help you survive the crisis?
Adjust your business model to temporarily accommodate operation arrangements, financial plans, and other aspects. Act fast to develop your incident management and planning scenarios specific to the challenges at hand. More importantly, create steps to meet government policies to reduce the risk of business disruptions. For instance, if the government mandates total lockdown in a place where your suppliers are operating, how do you manage the supply shortage and the pending market demand? All these things are crucial in creating a business continuity model.
2. Create a safe working environment for the workforce
COVID-19 has dramatically changed the daily lives of many people in unprecedented ways. As much as companies want to carry a business-as-usual mindset, it is hard to do. Is it possible to continue the business while taking care of the workforce?
For one, if possible, you can assess the benefits of a remote working environment. This plan creates a safe space for your people while still monitoring adherence to company policy. Before deciding to work remote, consider the strains on existing technology infrastructure and internal information handling. Think about whether your employees are equipped with the necessary technology infrastructure to accommodate the remote arrangements. However, if everything is good to go, you can implement project management software installation so everyone can still collaborate. Moreover, remember to draft your corporate communication and information dissemination process.
If your business has a global reach, you should also consider immediate mobility concerns, such as reviewing HR policies on travel rules and first-aid plans. Make sure that the systems in place ensure that all projects are documented and moving toward completion within a reasonable pace.
3. Plot for an efficient operation and supply chain process
As soon as you can, plan mitigating supply chain and distributions. Identify and create alternatives for various supply chain disturbance scenarios. This measure is especially true if your suppliers are greatly affected by the crisis. Arrange efficient pre-approved parts or raw-material substitution process. It should still guarantee that quality delivered to your customers isn’t significantly affected. You can also adapt allocations to pricing strategies in case there are problems with your supply chain. Now, if you’re offering services to your customers, make sure there are substitute services without additional cost on both your part and the customers’ side.
4. Think about company finance and liquidity
In a report released by FactSet, as of February 2020, 38% of 364 companies that held their fourth-quarter earnings referenced the coronavirus. Another 25% discussed the impact of COVID-19 or provided modified guidance. So, as a business owner, you may want to consider disclosures related to the direct effects on your operational results along with second- or third-order implications. Also, think about the risks and uncertainties due to the impact of the crisis in the company’s future liquidity and capital resources. That is why it is practical to work closely with the SEC in your filings and public releases.
5. Consider the crisis’ effect on taxation and trade
The current coronavirus significantly affects global mobility, tariff, taxation, and regional footprint issues. Thus, your business contingency plan must include processes on how to handle customs and short-term worldwide business movement and tax implications. If not appropriately addressed, this may cause more significant problems for the company.
6. Plot strategies for continued brand exposure
Companies are slowly transitioning from reacting to mitigating the impact of the global crisis. Therefore, you should also create plans that are specific to your brand for continued exposure and business operations. For instance, you should consider using the internet so customers can do their transactions with you online. Build upon the projection that customers are thinking about long-term considerations in shifting core market behavior. Additional digital brand exposure helps you adapt in case there are other dynamic changes in future consumer behavior.
7. Get involved in extensive corporate social responsibility
In times of a crisis, the way a company treats its employees, consumers, and society in general significantly impacts brand perception. It presents a real test of corporate purpose, which may not only boost your brand image to your target market but also increase your employees’ morale and attitude toward work. Here are some ways to act upon your CSR:
■ Microsoft pays their hourly employees and vendors full regular pay despite reduced service needs
■ Walmart provides financial assistance of up to a two-week worth of salary for all employees diagnosed with COVID-19 or those placed in quarantine
■ Apple provides paid leave to hourly employees who are sick with cold and flu-like symptoms that are similar to COVID-19
For many companies, handling a crisis has become a battle of balancing the employees’ and customers’ welfare while keeping the business operational. It is not an easy task since most of the existing policies in many companies may not be pandemic-proof. However, proactive action to adjust business policy and arrangements, you can reduce the risks and detrimental effects of a crisis.
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