Nothing has had such a universal impact on businesses globally since the stock market crash in 1929. Even other pandemics haven’t led to such widespread closures and restrictions on businesses of all types. As a CEO, navigating the treacherous waters of COVID-19 and its effect on “business as usual” is going to become increasingly difficult in the coming weeks or even months. Long after the virus is under control, you’ll see an impact on your bottom line. Minimizing the damage is just the beginning. As a CEO, you need to focus on the four Ps: People, Payroll, Product, and Process.
If you want to weather the storm and still have loyal employees after the crisis has passed, you need to treat your people well now. Don’t give in to the temptation to fire people – if they lose their insurance and can’t get another job (almost impossible right now), they will suffer. And they will blame you for not caring about them. Be more flexible about paid sick leave, offer flex schedules as needed, provide any assistance you can if a family member of an employee falls ill.
Talk to your shift managers and devise a way to keep the maximum number of people working. While you may need to cut some hours, most employees will be grateful to retain their jobs while others are losing theirs. If you do have to lay off employees, offer company guidance applying for unemployment and other forms of assistance.
There is an obvious problem if your company can’t make a profit during the Coronavirus pandemic. Without those profits, you may not have the capital to continue paying your employees even part-time. Do you furlough them? Fire people and hope they’ll come back later? Can you redistribute investment funds to cover any shortfall? While no solution is ideal, there are a few ways you can keep payroll on track for at least the short term so you’ll be more likely to get back to normal with experienced individuals once life and business return to normal:
- Small business loans can be a short-term solution right now because the interest rates are so low. A small business loan can keep your payroll in place and prevent the migration of valued employees elsewhere.
- A line of credit can also help, and since you only pay interest on what you use, it gives you added flexibility. If employment needs and supply requirements are fluctuating, a line of credit can help without taking on unneeded additional debt.
- While more expensive, a merchant cash advance against future profits may be possible. This is more of a stop-gap and is a bit riskier since no one yet knows how long business restrictions will be in place. On the plus side, a merchant cash advance can be put into place quickly. Weight the pros and cons before using this option.
- Discounts and grants to offset cashflow can be helpful in appropriating working capital so you can focus on ensuring you can keep your team employed.
Product or Service
If you sell a product, start talking to your suppliers now rather than later. Many suppliers are converting to the production of medical equipment or have been deemed non-essential. Look for alternative suppliers and speak to them about how you can help each other.
If you have the ability to shift the focus of your manufacturing, research what products you can produce that are more relevant and in-demand during a pandemic. Talk to some experts about how you can help. This will keep your employees on the payroll while you’ll get the satisfaction of helping out in a time of crisis. Your customers will hear about your efforts, and your stature with them will rise.
If you are a service-oriented business, devise ways to maintain your services in the COVID-19 world. Offer video conferencing, post updates, and information on your website to keep clients informed. Weekly emails to customers will keep you fresh in their minds. Many people will finally have the time to meet with you, but you’ll have to new a new process to interact with them.
If you are looking for new growth tap into solutions to find new customers.
The process used to keep your company running smoothly will have to change dramatically. This can be the most difficult of the three Ps because it requires effort from everyone at every level. It also involves a dynamic shift in thinking, so be patient as your employees adjust to new processes. There are several questions a CEO has to ask to restructure the process with as little disruption as possible:
- Which teams or employees could take over other work?
- What work can be done from home, and how do we facilitate this? If you don’t already have reliable video conferencing and document sharing set up, now is the time to do so.
- Can the company outsource some work? How difficult will this be?
- In the event multiple employees fall ill, is there a transition team in place? Are their others who can take over their work?
- Is any additional training needed to handle shifts in the work process? If so, who needs to coordinate this? Are there training options available remotely?
- Can communication between groups or employees be streamlined to minimize confusion? Consider narrowing down communication methods to just a few options, such as email and online conferencing. Simplification is key.