Open any news website and chances are the headline for the day will relate to the virus that everyone is talking about: COVID-19.
COVID-19 has been all over the news for almost two years now. We know stories of those who fall ill or succumb to the disease. But it’s a fact that the virus has already affected so many aspects of our modern world.
Here’s an overview of how COVID-19 affected businesses.
The Backstory Of COVID-19
First, let’s clarify that COVID-19 causing global havoc actually belongs to a family of coronaviruses. Some affect animals while others have an impact on humans, usually resulting in infection in the respiratory system.
While the common cold virus belongs to this family, the virus that scientists identified at the end of 2019 is one of the stronger ones. And so far, with the limited number of vaccines available, it has become a global concern of how people will eventually be infected. Symptoms may start with fever and a throat that hurts but it can progress and cause breathing problems.
The Wuhan Municipal Health Commission first reported cases back in December 2019. Because international travel is so easy in the 21st century, at the time of writing it has spread to infect over 100 000 people, resulting in over 3,000 recorded deaths. In fact, several individuals who were prepared for traveling experienced major delays. All continents except Antarctica have recorded cases.
Fast forward today, there’s a total of 219 Million cases worldwide, and 4.55 Million recorded deaths. If anything, how the number of cases compounded since last year, is truly frightening. Right now, the question is how the global community would work around this despite the disparity of each country’s regulations, policies, culture, and status quo.
How COVID-19 Is Impacting Economies And Businesses
The latest developments of the COVID-19 crisis matters to world economies and most businesses.
Supply Chain Constraints
China, where the first COVID-19 case was reported, is a huge role player in the supply chain of many industries. The subsequent outbreak in China, as well as in the rest of the world, required countries to take drastic steps to try and prevent its spread. This included people staying home from work and restricting travel.
The following are some consequences to businesses of the drastic measures to contain COVID-19:
- Many factories couldn’t function and had to postpone shipments.
- Restrictions with regard to importations are also in place. As such, manufacturers worldwide have been pressed to look for other alternatives or look for domestic production methods. This is a major factor to consider when improving your manufacturing processes.
- Despite the reduced options of suppliers, consumers would nonetheless want to bargain for the cheapest prices in the market, and other competitors would likewise pull down their prices as much as they can. Essentially, this limits how much a company would be able increase their product prices, all the while reducing their overhead costs.
As such, the pandemic has already affected various industries worldwide:
- In the electronics industry, electronic devices, many of which require components manufactured in China, couldn’t be produced as planned.
- In the construction industry, a shortage of construction materials, equipment, and other components needed for building infrastructure.
- In the transportation sector, simultaneous lockdowns prohibit or limit the number of passengers allowed.
- In the health sector, hospitals have an influx of patients that the quality of service that they offer would likewise be compromised.
- In fact, even autonomous industries began to reevaluate their opportunities and risks.
Changing Consumer Behavior
Even businesses with no direct links to China can be affected because the threat affects consumer behavior:
- Some have opted to stay at home rather than venture to restaurants or the mall.
- Others, despite wanting to invest in their health, would be restricted to go to the gym to exercise.
- In the light of delayed deliveries in some niches, buyers may assume it also applies to their goods they want to order; they may wait until there’s more clarity about the global situation before making international or global purchases.
- And then of course there is the matter of travel. Local and international travel carries more risk. Not wanting to risk getting sick, people are booking fewer, affecting the tourism industry. This is a major factor to consider before going on a business trip overseas.
The lifestyle of people and how they live their life have already pivoted. Business must adjust; otherwise, being doomed or set to fail for any initiative they would have.
How To Navigate The COVID-19 Chapter
It’s important that any company focuses on two important aspects — profit and people. Business leaders carry the responsibility to ensure their employees face as little risk as possible, as we progress through the pandemic.
Many organizations must still adhere to the policies they have set in place:
- Continue incorporating remote working conditions to limit person-to-person interaction and lower critical incident rates
- Update hygiene guidelines on your premises and ensure you align with recommendations from public health institutions
- Schedule essential travel only and determine which group gatherings are vital
- Make sure that employees required to meet in the office would already have been vaccinated.
- Evaluate your plans and see the options your organization can be equipped with amidst these uncertain times.
In terms of managing your business, you’ll be wise to revisit the following:
- Train staff in multiple roles in order for them to cover for each other if necessary.
- Review your supply chain and research other suppliers so you’re prepared if one should be affected by the Coronavirus outbreak.
- Revisit your marketing approach. Can you still reach a different demographic market in light of the varied regulations imposed by different countries?
- Rework your forecasts for a worst-case scenario and ensure you can keep on paying your accounts. If your income falls it affects cash flow. Find ways to cut costs and overheads if necessary.
- Excellent communication is essential to protect your reputation: keeping your shareholders informed and letting your customers know if you suspect delivery times will change.
- Contact suppliers and business partners and discuss the possibility of a change in payment plans.
- Procure tools and technology essential for business continuity.
The modern world is an exciting one, but COVID-19 also proves how vulnerable it is still. It’s only a matter of being able to adapt and thrive in this new normal.
A Post-Pandemic Foresight For The Board Of Directors
In line with the existing responsibilities of the Board of Directors, they should look beyond just focusing on the current status of their employees and organization. To maximize resources, they should also plot out their post pandemic initiatives in order to be equipped with the ever dynamic situation we are living in.
Here are some guidelines:
Firstly, the Boards of Directors can consider which among the regulations should still be implemented after the pandemic, or otherwise, be removed already. For instance, would the members of the organization still need to work from home? If not, how many times do they still need to go to the office per week?
Second, the Boards of Directors ought to also consider how these changes in regulations would affect their budgeting or finances. Some projects may need additional funding, while some other staple expenses like electricity would likewise ought to be factored in the monthly expenses after employees go back to the office.
Lastly, the Boards of Directors should note that changes in regulation may take time. The organizational members would need a certain duration of leeway to adapt before finally reaching an optimal way of doing things.
Ultimately, by taking care of your employees, your employees would be the ones to take care of your company.