As we all face the crisis this pandemic brought about, we are being forced to manage a business crisis on our hands, whilst keeping a watchful eye on the future. In this Blog post I attempt to give you some pointers to do exactly that.

The Now – Managing the crisis on our hands

1. No rushed decisions

First, give yourself time to decide. In the current climate it can be tempting to run out and make big decisions — to just do something. Many entrepreneurs like action and refuse to leave something sitting on their desk when they can help it. But that’s a bad strategy when every day reveals a bit more about how the Covid-19 crisis will play out. Everyone makes better decisions when they have better information, and you will have more information tomorrow than you do today. Before making any big leaps, consult a trusted person or better still a trusted professional to look over things with you — might help you avoid doing something you’ll come to regret.

2. Figure out how your customers’ needs have changed.

This Covid-19 pandemic is a shock for the whole world. Almost all of your customers’ lives are different than they were a month ago, and they will probably be different again in six months. They may never be the same. Your short-term cash flow depends on providing them with goods and services during the crisis. Your long-term viability depends on understanding how their needs will be different when the pandemic is over.

The first thing to consider is that people are building new habits right now. There are millions of isolated households whose normal routines have been upended, and just like them you have to experiment if you want to remain a part of their lives. Some restaurants are offering takeout comfort food, even if they usually just serve in their dining rooms. Retailers are emphasising online experiences. Your customers don’t need a vapid email about how you care about them, but they do need entertainment and comfort and hope. Some of their new habits will persist after the pandemic, which means it is particularly important for you to figure out how to continue to offer services that deliver value during the crisis.

Think hard about how the post-pandemic world will change your business model — and bring your customers into your planning process. When many of your customers will be poorer, but they will also be eager to enjoy themselves after the long seclusion. Many will still be scared about the risks of contagious disease. Some of them may have decided that they like ordering online. Reach out to them to learn how their lives have changed and figure out the most exciting thing that you can offer your customers once they can leave their homes. Ask them what they are looking forward to and help them look forward to the day that they can buy from you again.

3. Scenario Planning

First, try to form realistic estimates of your cash flow both during and after the pandemic. Compare that cash flow with your fixed expenses and with those expenses that you can cut. Remember that sometimes it makes sense to cut the more flexible expenses early, so that you can still keep paying the more vital expenses later.

Take a number of scenarios. What is the worst case scenario you can think of? Is it plausible? What do you need to do to keep operating if that worse case scenario becomes a reality? Do you need a temporary liquidity injection or a moratorium on any bank loans? Do you need to take more drastic action like reducing the number of employees? The most important thing is staying ahead and being prepared.

Obviously stay abreast of all forms of government assistance and avail yourself of them if you can.

4. Keep your best employees engaged and loyal.

Your employees are always your most valuable asset. If you lose your best ones during the crisis, rebuilding your operations is going to be even more difficult. Even if you have to cut wages dramatically during the crisis, you want to maintain your best workers when the world is open for business again. The key here is to focus on the long term and to be human. The government backed loans are also intended top stop you from dismissing your best employees. Most importantly talk to your employees about these choices your business is faced with and make sure that the any decisions being taken have their support. If you do have to make some tough decisions about who you want to keep, focus your attention on retaining people who feel like the best fit and who really care about being part of your company.

The Then – Preparing your business for after the crisis

As things are changing fast, from consumer habits to work habits, any Ad hoc or improvised responses to a changed market place by a business organisation must be doomed to fail. Business organisations must lay the groundwork for their recoveries right now.

The following questions can guide you as you work around a plan to have you business bounce back from the crisis.

1. What position can you attain during and after the pandemic? To make smart strategic decisions, you must understand your organisation’s position in the market it operates in. Who are you in your market, what role do you play in your ecosystem, and who are your main competitors? You must also understand where you are headed. Can you shut down your operations and reopen unchanged after the pandemic? Can you regain lost ground? Will you be bankrupt, or can you emerge as a market leader fueled by developments during the lockdown?

2. What is your plan for bouncing back? A plan is a course of action pointing the way to the position you hope to attain. It should explicate what you need to do today to achieve your objectives tomorrow. In the current context, the question is what you must do to get through the crisis and go back to business when it ends. The lack of a plan only exacerbates disorientation in an already confusing situation. When drawing up the steps you intend to take, think broadly and deeply, and take a long view.

3. How will your internal culture and identity change? Perspective means the way any business organisation sees the world and itself. In all likelihood, your culture and identity will change as a result of the pandemic. A crisis can bring people together and facilitate a collective spirit of endurance — but it can also push people apart, with individuals distrusting one another and predominantly looking after themselves. How prepared was your organisation culturally to deal with the crisis? Will the ongoing situation bring your employees together or drive them apart? Will they see the organisation differently when this is over? Your answers will inform what you can achieve when the pandemic ends.

4. How prepared are you to execute your plans and projects? You need to assess your organisation’s preparedness. Are you ready and able to accomplish the projects you’ve outlined, particularly if much of your organisation has shifted to remote work? The capacity for good quality execution is the the end of the day the key factor on whether you manage to achieve success or not.

At EMCS (www.emcs.com.mt) we specialise in what we call our “coaching” service, whereby we hand hold our clients and advise them in great detail on their operations, their most urgent strategic decisions and the needed business planning process which every businesses needs to undertake. Feel free to drop me an email on silvan.mifsud@emcs.com.mt to learn more.