Post COVID-19 Key Areas for CEOs To Review
Post COVID-19 Key Areas for CEOs To Review
1. Clarity and certainty from the political decision-makers.
Business runs on confidence and predictability of the future. Without some clarity from the government, business is likely to continue to be cautious in its decisions around restarting its activities. It needs a sound basis on which to take the risks which coming out of lockdown will be. Considerations on the possibility of a second wave will be key considerations on how far and how fast to try to return to normality.
The writings and opinions of the print and broadcast media will be important for the zeitgeist that they create. The natural skepticism of the government’s decisions and concerns magnified by the unprecedented nature of the crisis together with there being no previous experience of such a disease will magnify business caution.
The reporting of the number of cases and deaths has shifted over the last few months with a focus now on new cases rather than deaths. However, with more testing more benign cases will be found which will skew the % and increase the fear factor. There is a case to be made for better and more accurate reporting of the numbers and the associated risks to different age and ethnic groups.
The playing of politics with Covid-19 whilst denying that politics are being played at all by politicians, media, scientists, unions, medical bureaucrats, and medical professionals muddies the waters even further and will influence business decisions
Businesses will increasingly be focusing on their cash reserves and cash flow management. Cash flow is the lifeblood of businesses in normal times. In the current environment, cash flow is doubly important and its careful management will make the difference between survival and insolvency.
Furloughed employees paid for by the government are increasingly likely to be laid off when this program finishes protecting businesses’ precious cash resources. We have already seen a rolling series of offices that are now shut will be slow to reopen and working from home will increase. The new paradigm may be cheaper initially but there will be consequences for team coherence. This new way of working will require management to work through how to conduct business effectively in the new normal and will take 3-12 months to work through with decisions based on caution throughout this time.
3. The delivering of sales after the lockdown period in the new normal will cashflow management be challenging.
How has lockdown changed the demand for your products and services? Are they still needed or wanted? If you are building or leading A380’s or 747’s the market has disappeared completely and will never come back. In this case, what do you do instead? Move into private jets? So, review all your sales lines and ruthlessly evaluate each one for continuing market demand and long-term sufficient profitability.
What new products and services will be needed? Can you move into new areas? What are the financial implications of reorientation your business towards these new areas? What are the staffing and costs structure implications? Demand will change and your businesses will need to adapt.
4. Developing new sales processes for the new normal.
What new processes do you need to develop? What are the IT and networking implications for the office and for those working from home?
Digital marketing will become more important in the sales process and the integration between CRM systems, websites, and digital marketing activity will become critical to business survival. Those who are too wedded to past and slow to react and change will at best be left behind. Failure of the business for those who do not change is highly likely. So, get your self-ready for the new normal. Adapt or die.
After a period of disruption to the business with additional costs, lower sales, longer cash collection terms there is a higher need to focus on not only the business’s overall profitability but also the profitability of each part of the business.
Radical surgery may be required. Shutting down parts of the business as we are already seeing being announced in the press may be the price of survival.
Profitability and cash flow will be the watchwords for everyone in the business from the CEO and his team down to the most junior intern or trainee.
Every new sales opportunity will need to be thoroughly scrutinized.
Review staff costs. Explore the opportunity to prune the organisation chart. Assess the efficiency of all your staff interactions with each other, customers, and suppliers.
Change is coming. Get out in front of this wave, develop e-business platforms, Increase the use of Zoom & Teams, maximise the opportunities of the Cloud, and do not be afraid of radical changes needed for your business survival.
Review office costs. Explore how the change to zoom or teams working reduces the need for traditional offices. Look at lease expiry dates and make plans to rationalise offices where possible.
Review suppliers’ costs. What costs can be reduced? What areas are no longer required or can be cut to save money?