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Tuesday, March 31, 2020

COVID - 19 & YOUR BUSINESS - THE CHALLENGES AHEAD


Hello friends

Another financial year is ending today and we are entering into a new financial year, amidst the uncertainties and challenges arising out of Covid-19, both in your business and personal sphere. The COVID-19 outbreak poses unprecedented challenges to businesses, governments, and societies around the world.

At this juncture, can we do something other than wait and watch, at the same time staying safe and staying healthy?

We can have an introspection to the business so far this year. We can also assess the possible fallout and challenges we may face next year due to the Pandemic. Of course, the situation is unpredictable, still we can visualise all possible scenarios and prepare ourselves for the worst. We can have a Plan A, Plan B and Plan C.

Some of the challenges we are going to face will be:

1.     Decreased business activity and resulting liquidity crunch in the market
2.     Disruptions in Supply Chain and Logistics
3.     Difficulties in Marketing efforts due to travel ban and the like

Facing the Liquidity Crunch

One of the major issues we may be going to face will be liquidity in the market. We will have to plan our cash budget very meticulously. And monitor it on a continuous basis. Wherever expenditure can be reduced, we should look into it at the same time it should not disturb the smooth functioning of the business. We have to identify the blocked cash and implement steps to realise it – be it inventory or receivables or other assets.

You have to appreciate that there will be a short term drop in the total business activity, leading to lower spending and lower consumption. So, our sales forecast should take into consideration this aspect also. We can not apply static solutions to dynamic situations. So, we should keep our eyes and ears open to grasp each and every signal the economy is generating and should be ready for every eventuality.

Make sure that you avail all the schemes and facilities offered specially to meet the Covid – 19 challenges, by the Government and banks.

Care for your Employees

In the human resources front, the thrust should be to increase the productivity per person. And if your work culture is great, the biggest support you are going to get will be from your employees. How you treat your employees now will have a massive effect on their well being, and consequently on their loyalty and productivity.

One important fact you have to appreciate is that we all are facing a Pandemic – you, your business and your employees also. It is not a time to desert your employees who are, if fact, the eyes, ears, hands and legs of your business. Be humane, Show compassion and benevolence. The universe moves on inter dependency only.

Handhold and survive

This unprecedented business crisis may drive the world into a recession. This will not be a short-term phenomenon; it is going to last a little longer. So, survival of the fittest will be the mantra for the future. But one person alone cannot stay fit where all his surroundings are collapsing. So, I would say survival by co-operation and collaboration should be the strategy to tackle this uncertainty.

As Ms. Suneeta Reddy MD, Apollo Hospitals Enterprise points out, This Pandemic Reminds Us that We are All Equal and Connected. It reminds us that we are equal regardless of our religion, culture, occupation or financial situation. It reminds us that we are all connected and the false borders we have put up give us no protection.

Every Challenge is an Opportunity

Yes, Covid – 19 is big challenge and we should appreciate that the challenges only make us stronger. As the saying goes, “rough seas make great sailors”, each challenge should drive us to identify a different opportunity. The Businessman should be able to convert a challenge into an opportunity and there lies the sustainability and growth.

Be flexible to take fast decisions. The way you react to the challenges define you and your business. Please remember, a whole world is looking at you – how you are going to face this or how you are going to react. The economy, your employees, your suppliers and customers, all other stakeholder and your family – your decisions are going to affect all of them. So be sensible, be proactive, be alert, be receptive to different viewpoints and thus make your mark.

This is a remainder

This kind of Black Swan events can occur more frequently in future and we should have a proper Business Continuity Plan and a Disaster Recovery Plane in place. You should be stable and level-headed, where the entire world may be in shambles. You should be thoughtful and decisive. Wait and Watch is not the best idea for the season. Take informed decision and communicate to lower ranks. Leaders need to be loud during the tough times and that is what everyone is expecting from a Leader.

End Note

Last but not the least, take care of your health and your family. Health and fitness give you physical strength where family gives you emotional strength. Afterall, who do you work for?

Random thoughts by CA. Jameskutty Antony
(please give me your feedback on this)

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