For businesses, pandemics are about the quick and the dead. With no way of knowing how long a plague will last, even businesses that have lots of resources will struggle, and possibly go under, if they fail to turn the situation to their advantage.
This is because a pandemic affects a company’s entire ecosystem, so that their network of suppliers and buyers weakens, and the conditions under which they made a profit disappear. On the other hand, businesses that are fast to realize the opportunities of situations like COVID19 might even thrive.
One Does not Simply Pivot
Stories of companies that have adjusted to the coronavirus economy are numerous, and their success can be attributed mainly to two factors. First, they built a strategy according to an existing capability. Second, they have taken advantage of a long term trend that was either made more intense or was created by the pandemic. So, for example, Cheetah moved beyond supplying restaurants to becoming a contactless consumer delivery service, and Netflix developed Netflix Party to replace going to the theater with friends.
However, behind these positive outcomes are a variety of other changes. The coronavirus is generating continuous shocks to fundamental economic factors like workforce availability and international trade, so successful companies need a whole set of adaptations as a counterweight. To understand the nature of these measures, let’s take a look at the lessons learned from past pandemics.
The Black Death and Bad Communication
The worst plague of all time (knock on wood) may have killed as many as 200 million people and wiped out almost half the population of Europe. With medicine being primitive during the 1300s, doctors and officials had no idea as to the cause of the Black Death or how to treat it.
But they sure tried. Word spread throughout Europe that the blame was to be placed on various groups, particularly Jews and those suffering from skin diseases. Of course, attacks on these groups did not alleviate the situation, but misinformation continued. After four years, the plague burned itself out, yet it would take over 150 years for Europe to regain its lost population.
Communication during the COVID19 period has been problematic as well. A lot of criticism from the corporate and private world about governments, other nations, and various people has taken the place of accepting reality and adapting quickly.
Companies must focus on being proactive in communicating internally about their survival strategy and then communicating that message externally. Steps which will help companies make the change can include:
Build a dedicated information and strategy team
Discuss changes coming to production, shipping, billing, etc. with staff and suppliers
Find mutually agreeable ways to deal with stakeholder commitments such as delayed payments, supplies, and agreements
Build a brainstorming team to come up with new products or services to offer during the crisis
The Spanish Flu and Sustained Adaptation
All pandemics come in waves, but with varying intensity. For example, the Spanish Flu of 1918-1919 came in three waves, but it was actually the second wave which killed the most people in the U.S. despite all the preparations that had been made after the first wave. The impact of the second wave indicates that effective measures had not been implemented, and rapid changes were required to prevent an even worse situation.
The moral of this story is that the world is ever changing, catastrophes are a fact of life, and businesses must be ready for continuous adjustment in order to survive in the long run. As the coronavirus period gets longer, the effects that it has on many parts of the economy will accumulate, and the next year, if not longer, will be a great period of adjustment as the economy learns collectively about coping with the situation. That’s why, between waves of the pandemic, companies should:
Assess the long term viability of their current strategy
Analyze how suppliers and buyers are performing with an eye to realizing pricing opportunities
Reorganize the logistics chain in case of buyer or supplier bankruptcies
The Swine Flu and Staff Management
Just over a decade ago, the major pandemic was swine flu, which may have killed as many as 575,000 people. It’s fascinating to see how similar the conditions of, and business reactions to this plague were to the coronavirus. The swine flu was most deadly to people less than 50 years old, in other words, a major part of the workforce. For this reason, businesses were encouraged to use social distancing, PPE, and a staff categorized to maximize remote work.
In particular, companies were encouraged to split their teams into groups according to the need to be physically present, and those that did not were enabled to work remotely. This measure not only ensured that production could continue, but that exposure to the virus was minimized as employees required to be physically present had to maintain strict protective measures. This was both a practical step and a way of ensuring that being at work was more psychologically acceptable to those fearing infection. To complement this move, companies should also:
Change production schedules and workflows
Adjust operations to accommodate staff that is working from home
Focus on results, instead of time spent in the office, while avoiding micromanagement
Staying Positive during the Pandemic
The economic crisis caused by the coronavirus does not necessarily mean that companies or industries must die. It may “thin the herd” for industries in which firms are only trying to survive instead of forge ahead. However, in every crisis there is an opportunity, and whoever has a positive outlook will come out ahead.
As Published on Air Doctor.
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