How to handle the current COVID-19 disruption?
Co-working space disrupted the workplace culture, but what happens when an unheard-of and unprecedented phenomenon disrupts our lives, one beautiful day?
Does thriving in times of crisis traditionally only mean facing roadblocks? No, but strange as it may sound, it also opens up opportunities. Today, the COVID-19 has got India ‘locked and loaded’, putting us under ‘house arrest’ as newspaper headlines screamed. Yes, it has thrown all of us out of gear, into a state of uncertainty and stress.
We believe that if there is anything you can do to lighten a disaster, the idea is to be prepared and, at the same time, be extremely careful. Finances will get impacted for sure. If done right, you can prevent a financial crisis from spiralling into a massive disaster, so that perhaps you may only have to deal with temporary setbacks.
As entrepreneurs, we all have struggled with uncertainties and should understand that it does not need to be a whole anxiety-ridden experience.
While we all can together help curb the spread by following measures as stated by the health and local authorities, the business impact will only be known in the months to come. Here are a few things we can control as individuals.
Keep the ‘positive’ cap on
Spread the positive vibes. First and foremost, we need to protect the people we are involved with daily, like – full-time and part-time employees, consultants, clients, suppliers, and others. At a time like this, we need to safeguard their health and well-being in every possible way.
Of course, there are business priorities to be focussed on too. We need to access and make quick decisions - to guide the business through this rough weather. One of the most critical steps enforced now, with the government pitching in, is the practice of ‘social distancing’ to flatten the curve of the spreading of infection. There are critical aspects to keep in mind that may help us to tide over this crisis.
Study your finance status. It’s crucial to take stock of the situation. Start by clipping any frills, and do not include any activity that is not a necessity. Check if the revenue has taken a hit. Is it declining? Analysing this is very important for a startup, as its very existence depends on this balance.
Identify sources of additional capital like bank loans, loans from investors, deferred payments to vendors, and loans from significant partners so that you can understand how quickly you need to start moving to ring in more cash.
Manage your expenses - the credits and debits. What is the cash flow situation? Now, it is time to gauge all business expenses. Categorise every spending and indicate if it is a one-time or recurring expense.
Set financial priorities
Since finance is the base of any business venture, it is time to understand your finances - your outer limits and ongoing profitability. Cash is the lifeblood of any business activity, and you need to fathom exactly how much you have. Take stock of your gross cash burn rate, that is, the number of operating costs you incur each month.
However, it may be wise to get a grip on the worst-case scenario, especially taking into consideration the sudden picture of revenue instability that is emerging for most businesses right now.
Look inwards and calculate how many months you can survive on your existing cash after assessing your monthly expenses.
Leverage the technology at hand to connect with your stakeholders
Align with all your stakeholders - be it employees, partners, or clients. With the ‘social distancing’ trend that has set in, it’s the technology that will help to connect and keep contact in these days of work-from-home mode. So, have your technology in place. Act fast, and move to a digital platform, and minimise the disruption caused by the COVID-19 outbreak.
Focus on health
During this time, taking care of the health of employees is of prime importance. Provide financial stability for employees when the question is about whether your profit margins may take a beating. We are seeing some companies already stepping up on this.
Also, promote the mental health of all stakeholders – clients, customers, and employees by reducing stress and providing relief from tension.
Take out time to acknowledge your financial stakeholders – investors, partners, co-founders, and so on. Check and ensure you are aligned on your objectives.
Develop a plan with a clear list of priorities and track progress
Despite the current scenario, plan for the future. Ensure your existing customers, internal and external, are happy. Discuss with them how you can help them navigate this difficult time. Also, do not hesitate to share what measures you have planned to get them into the loop.
In this time, we have to be transparent, efficient, effective, responsive, agile, innovative, and focussed on our decision making as a buffet list of decisions is not going to help.
If community and goodwill are especially important to you, work on how your business can help the community around you. Step into social media and develop a pattern of storytelling to explain how your business is continuing its efforts in serving the business community.
Most importantly, exercise your empathy!
Create a plan for when this is over. How will your industry have changed? What can you do to rebuild loyalty as the sector rebounds? Respect the turbulent time, learn from it, and implement the best of the strategies or decisions. Ultimately re-imagine and build your ways to survive and rise above all odds.
Lastly, a positive note, happy times will be back soon! Indeed, this is an unimagined phase that is unprecedented in history. But remember, it will eventually pass. Think of this as an opportunity. This is the best time to reflect on repositioning your business not just to survive, but to thrive in this new world! And then, the sky is the limit!
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)