The ongoing COVID-19 crisis is affecting small and large businesses in challenging ways many managers and owners have not seen. Many small businesses have not developed a crisis business continuity plan and are having to adjust to these times rapidly. I would like to discuss a couple points to continue to address as the situation develops.
- Adjusting Business Strategy
Many businesses are feeling significant disruption in their typical day to day business operations. As there is currently not a good timeline for when this crisis will lessen to start back typical operation, businesses must adjust to the current situation for now and remain flexible as it changes. Significant changes from guidance and regulations to consumer behavior will require businesses to address these issues.
Things to consider are current liquidity, financial and operational risk, and product delivery. You need to be maintaining strict financial diligence to ensure your company will be able to survive this crisis and be able to return to normal operations. Also, you must evaluate certain costs. For example, laying off or furloughing employees might save money now. If those employees do not return, then companies will be scrambling to fill open positions that will require training once the business starts to increase again. One plan I have discussed before is the Work Share program. This allows you to cut hours on certain employees and reduce current operational cost without an employee being unemployed. Under this program employees are eligible to then claim a portion of income from a similar program as regular unemployment to help lessen the burden of decrease income from reduced hours. Other methods we have seen particularly from restaurants is limiting to only to-go or delivery of food. Ensure that customers know that you are still open for business but with possible limited hours, items, etc.
Communication is key during this time whether viewing it from stakeholders’, customers’, or employees’ point of view. Like mentioned above, if customers are not being informed you are still open, they will not know to come. Additionally, let them know the precautions and how you are managing risks to help ease their mind over the current crisis. Keep employees up to date on current plans or possibilities. Managing between caution and current business plans can help keep morale up in the workforce. Employers should help their personnel as much as they can, an informed employee will be able to properly plan for what is currently best for them. As Well, keep your creditors and shareholders up to date over the situation. You don’t want to “blindside” your sources of capital with news before they can plan to assist with possible upcoming changes.
Last but probably most important, always be evaluating your actions for safe and low risk operations. Find ways to help balance operations with guidance that has been put out by government or government agencies. If you must “close shop”, then sometimes its unavoidable. Do not risk customers or employee’s safety to try and earn one extra dollar that could possibly not even mater. All businesses are developed with the intention of being profitable, but when that amounts to risk to personnel or customers, you must step back and reevaluate for a new strategy.
These are not the only points that businesses should be addressing through the situation. Remain flexible and continue to balance risk vs reward through your operations. Although you might not of had a plan in place, not many companies were ready for this type of crisis. As you do your best working through this, do not forget to similarly plan for recovery now as well. Use these lessons to learn how to operate in the future once this has passed.
Stay safe, be resilient, and help shape how we remember this crisis.