Consider this a war, a war of survival, the full impacts of this current crisis are not yet fully realised nor the duration of the impacts.
In this article, I would like to give you some practical things you can apply to your business in order to minimise the impacts of the current situation. But first we need to look at some trends.
What does this mean locally? Based on the trend should see some normalisation around end of June early July. The rest of the world will take longer with developed nations possibly normalising around the same time or up to 4 weeks later, while 3rd world countries possibly 12 to 16 weeks later. Providing continued travel restrictions and border controls remain in play.
As a business leader, this is the time you need to step up and be at the front line directing your people, leading by example & fully hands on in your business. There are elements of working in your business as well as working on your business.
This is a time to take charge and take control, after all, the safety and well-being of your staff and the survival of your business depend on it. Your staff are looking for leadership and direction from you and your management team.
If you have staff working from home you need to realise that the level of productivity will be diminished, particularly if their partner is also at home and if children are at home.
Can staff take annual leave, long service leave, leave without pay or a combination of either, possibly working part time hours.
Ensure that each staff member has DAILY defined accountabilities, tasks and outcomes.
Ensure that either you or you line managers are holding ‘huddles’ or team meetings via a video online platform (zoom, teams, skype, other) daily to check on your team’s well-being as well as checking on their work progress. You need to get a feel for their home working environment arrangements, expect your staff to be groomed as if they were at work, particularly if they’re conferencing with clients, suppliers or other businesses, you need to maintain your brand integrity.
This is not a time to accept complacency or mediocrity, this is a time for everyone to step up and for you to be demanding. Ensure that each member of the team reports back as to their progress on their assigned tasks, responsibilities and outcomes each day in the team meeting.
If you still have staff working at the office, they too will be distracted, concerned about their loved ones and apprehensive about being exposed outside of their home. Ensure that they too are part of the daily ‘huddle’ and have daily accountabilities and outcomes to achieve.
If you have middle managers (executive team), ensure that they are carrying out these meetings & holding their teams to task. You should be doing the same with them in every aspect & expect the same of them.
You need to have a clear view of your runway, that is, you need to establish how long you can last at this current rate, at -25% of current, at -50% of current, -75% of current. You need to work with your CFO or accounts person to establish the business’ ability to pay all its bills in different scenarios. You should be projecting, as a minimum to the end of July 2020.
Look at your liquidity and seek contingency measures to minimise the impact – more on that below.
Ask your accounts person or CFO to provide you with a copy of last month’s GL (general ledger) & go through every single line looking at what can you stop, what can you reduce and what you need to increase.
If everyone is working from home, can you cancel, suspend or reduce things like cleaning, sanitary services, air conditioning (if on a timer, ensure you adjust or turn off) other scheduled services, gardening services, rubbish removal, rent, outgoings, phones, coffee/water services, subscriptions to magazines, licenses & insurances (if you have laid off staff), photo copier, broadband, etc. The GL will guide you.
Consider reducing pays across the board by a %, 20%, 25%, 30% or more. If this helps you provide a longer runway it’s worth it. As an employee I’d rather take 75% & keep my job than 100% and lose it! (Please check with your HR expert regarding minimum wages, awards, etc. and seek independent advice). You may be better off laying staff off. Are you in a position to offer equity for the reduction in pay? Or could you be able to pay it back once this is over? Although it may be restrictive with staff, you can certainly consider it for any contractors or consultants you may engage.
In respect to the place of work, be it an office, factory, workshop, warehouse or other, ensure that any automated services, like lights, air conditioning, compressors, refrigeration, etc. is reviewed and either shut down or turned off. Do you have standing orders for supplies, product, etc. Review and reduce/increase accordingly.
What is available to you in respect to financial relief from governments, financial institutions, suppliers, utility companies, landlords, tax offsets, grants and refunds, etc. Someone should be working on this as a priority for you so that you can factor this into your financial model.
Now it’s time to work on your business – but wait, still ensure that you’re meeting with your lieutenants daily to gain comfort that your troops are in good spirits and productive. As a leader, you need to be seen and accessible now more than ever.
You have now settled the troops, instilled some new order and accountability and are comfortable that you are across all your armaments, tools, supplies and have either shed, shelved, retired or suspended any unnecessary assets, supplies or services. You now have a clear vision of the runway and know at what point things become critical.
Now that I know what I must stop doing & continue to do, I need to work out what do I need to do differently or begin doing! In respect to your business, your offer and your proposition, you need to plan for three outcomes;
a) Status quo b) Worst case scenario c) Best case scenario
What opportunities do you foresee in the imminent future, medium future, beyond the crisis?
What do you need to have in place to ensure that you can positively ramp up when the opportunity presents itself?
What actions can you undertake now, in the next four months, in the next six months to take advantage of these opportunities?
He who fails to plan is planning to fail. (Winston Churchill)
You will come out of the other side, one way or another,
nothing comes from doing nothing. (William Shakespeare)
It is better to have tried and failed than to have never tried at all. (Theodore Roosevelt)
Business and Team Development Specialist
Henry is an accomplished business leader with over 30 years of business experience in corporate and private sectors, both in Australia and abroad. If you are interested in learning more about Henry and his workshops on Essemy, please visit this link.