Nobody saw it coming so no one was prepared, not that you can plan for a pandemic. The world has changed in unmeasurable ways since Covid-19 spread across the globe, that is undeniable. There won’t be many people in countries badly affected by the virus that haven’t been impacted directly, had their lives altered or normal day-to-day routines moved around. The knock-on effects have been catastrophic to some and the upheaval is certainly being felt in the business world.
The evolution of the virus has seen rapid reconfiguration for companies and organisations across all sectors in a scrambling attempt to stabilise their businesses in what has become a very different society. A new working environment is upon us with owners and managers being pressed into emergency strategies for key areas of business in order to survive.
In this article we explore the impact of Covid-19 on some of the core areas of business that could be vastly implicated by the virus. We will also examine how leaders can quickly change the way they operate in each area to reduce the inevitable damage companies are facing in these key business aspects. We will break down the threats and offer guidance on how to respond appropriately and effectively for each.
What could the consequences of Covid-19 be for: Strategy and brand?
The transition from reacting to the circumstances into mitigating them is a challenging one. Strategies that worked pre-pandemic have gone, the hurried ones put in place when it hit may not be entirely applicable anymore. The emphasis switches from wondering how long it will last to accepting reality and focusing on re-emerging stronger than before.
What could the consequences of Covid-19 be for: Tax and regulatory systems in trade?
The societal, economic and political landscape is changing in front of our very eyes. In order to take business forward, these areas that we operate in need close analysis and compliance in order to make crucial decisions. The complexity and level of risk involved in the uncertain society we face dictate that normal tax functions in trade will require more than a basic knowledge and understanding of the tax and regulatory systems.
What could the consequences of Covid-19 be for: Liquidity and finance?
The lack of freedom and restriction settings of the various lockdowns and the impact of being covid-compliant has seen businesses lose revenue heavily. Less cash flow of this nature is likely to continue for the foreseeable which makes managing cash and liquidity positions extremely important in this period of economic uncertainty.
What could the consequences of Covid-19 be for: Supply chain and operations?
Beginning to mitigate supply chain distributions is possible for businesses. In spite of the strange situation, this can be achieved by global companies. Operations have to be adapted to fit the new normal whilst maintaining safety standards throughout. Any alteration to models and systems will need to be carefully configured no matter how temporary they end up being.
What could the consequences of Covid-19 be for: Responding to crisis management?
Some teams, even from the largest and most experienced companies, found the fast-pace changes and unforeseen variables of the Covid-19 pandemic too much. Existing crisis plans simply could not handle something of this proportion. Others coped admirably and have set an example for all to strive towards. Everyone should endeavour to learn from this experience and update your crisis management protocols immediately. It’s time to look ahead not back.
What could the consequences of Covid-19 be for: Employee/employer relations?
Each business will be different but we will attempt to put a blanket approach on this and generalise how employees may be feeling about their working environment/ job status and working future. There have been closures, redundancies, cut-backs, working from home, reduced hours, new rules, furloughing, new processes and different customer bases amongst the madness of the pandemic. These in turn create unstable mental health, confusing policy changes, immediate direction changes in what has become a stretched and uncertain working base for many. So many alterations in a short space of time take staff out of their comfort zone and inadvertently introduce an influx of nervous energy about a business. This can have a negative effect on morale, relations between colleagues and the gap between management and staff conflicted with uncertainty over job security.
Plan of action to combat the implications of Covid-19 on business
Branding and Strategy: What can my business and I do to limit Covid-19 impact?
- Consider accelerating digital transformations by focusing on IT infrastructure, workforce planning and digital upskilling
- Protect growth and profitability through actions such as scenario planning and new models that incorporate economic impacts of past pandemics
- Think through longer-term considerations around shifts in core markets or business models as a result of the pandemic
Tax and regulatory systems in trade: What can my business and I do to limit Covid-19 impact?
- Manage cash taxes, gather available refunds and contemplate local government and tax authority measures to react to COVID-19
- Stabilise supply chains but prepare for unpredictable revenue and mixed profitability
- Identify resources your business needs to meet the continuous indirect and direct tax compliance obligations
Liquidity and finance: What can my business and I do to limit Covid-19 impact?
- Plan for worst-case scenarios to evaluate the potential impact on the cash position
- Conserve and generate cash wherever possible, explore access to funding.
- Investigate prospects for relief from the tax provisions or other local measures.
Supply chain and operations: What can my business and I do to limit Covid-19 impact?
- Pinpoint back-up supply chain locations in case of shut down in the area that supplies you.
- Adapt allocations to customers and pricing strategies
Responding to crisis management: What can my business and I do to limit Covid-19 impact?
- Review your crisis management team and your response efforts in the immediate wake of the crisis
- Look at insights the crisis process has highlighted to assist you to strategise and capitalise on the opportunity for improvement
Employee/employer relations: What can my business and I do to limit Covid-19 impact?
- Implement schemes to help support employees’ physical and emotional well-being, whether at work or at home.
- Lead with responsive, empathetic communications and policies that help people feel informed and supported.
- Provide the resources and support employees need to be productive, particularly as they transition to working remotely.
Businesses have been impacted by Covid-19 and although there might be light at the end of the tunnel, businesses have the opportunity to position themselves in order to make sure they come out of it with minimal damage.