Whatever your 2020 business plan or forecast looked like a couple of months ago, it’s safe to say those projections are now irrelevant. As distressing as that is, you’re not alone. You might be reeling from the crushing blow of your business falling behind, but then so is every other business in your industry.
Most businesses are having to shift not only expectations, but also rethink the tactical reality of how to accomplish the work in the weeks ahead. As of this writing, social distancing is being preached, but just over half of the states have implemented shelter-in-place mandates, sending mixed signals to companies with operations around the country.
The only thing we truly know right now might be this: there is no proven playbook for how run a business during a pandemic.
So the question becomes:
How do you plan when the landscape keeps changing on a weekly and sometimes daily basis?
I believe it’s rooted in developing a 30-day, 60-day and six-month strategy based on insights that we know right now. Keep in mind that you’re planning for uncertainty (“what if…”) as much as a desired state of certainty (“we will…”). Businesses will need to be nimble and adjust as new information about the pandemic’s impact on people’s ability, as well as any modified business strategies. Today, clarity triumphs over certainty.
Most businesses are already well into the 30-day strategy, which is largely about operations and figuring out what can be done and how it will get accomplished. But I believe what drives the next 30 to 180 days for any business is rooted in these three realities, all of which will go a long way to determining how businesses emerge from this crisis when the coronavirus curve is flattened, and work as we once knew it resumes to some sense of normalcy.
- Financial solvency drives your reality. Your business acumen and fiscal management up to this point might very well determine what, if any, next steps can be taken. Companies with strong balance sheets (cash reserves, three to six months of payroll) are better positioned to weather this storm. This reality will dictate whether your strategy can go beyond 30 or 60 days. Simply stated, if you’re financially strong, you have options. If not, you’re in survival mode and need to generate incremental revenue to stay afloat.
- Recalibrating versus waiting it out. Businesses and executives have three choices: fight, flight or freeze. If you’re in a healthy cash position, you’re now contemplating which approach you’re going to take. Will you hunker down and wait out this season of uncertainty, and try to protect what was on the books and planned? Or are there additional things you can be doing to give your company momentum as the economy recovers?
Consider the remarks made by Jerome Powell, chairman of the Federal Reserve, from a March 26 interview on the TODAY Show, where he said “there is nothing fundamentally wrong with our economy” – making this scenario very different from past recessions. Further, he said “there can also be a good rebound” and that the Fed is working to “ensure that it is as vigorous as possible.” This sounds promising for businesses, and companies that can rebound at the pace the economy dictates are likely to survive. The businesses that are preparing now to run ahead of a rebounding economy will be positioned to thrive and gain an unfair share of business as a result. Remember, the biggest difference between the Great Recession that began in 2008 and the Covid19 Crisis is that this time, there are clear winners and losers (Amazon and grocery stores vs. airlines and the hospitality industry).
- Putting purpose to practice– Employees will see their company’s stated purpose and values tested in the weeks ahead, and they’ll get to decide if they resonate or ring hollow. The purpose-driven business will align its strategy to do the right thing in support of its purpose. If the purpose is beyond making profit, there will be a shift in activity that underscores and confirms the purpose. For example, if the purpose is to make communities better places to live, especially where employees live and work, what does that look like right now? How will the company empower its people to deliver on that purpose at this moment in time? Every company should be asking – how do we want employees, customers, and all our stakeholders to think about us six months from now? The actions taken today will go a long way to clarify sentiments – either good or bad – in the months ahead.
Unexpected events like this global pandemic test our personal mettle as well as the resiliency of our businesses. Difficult decisions are part and parcel of difficult times. Leaders shouldn’t panic. This is the time to get back to basics, being open and transparent with your communication, and being agile in your planning. It’s about adhering to your values and practicing what you say matters.
If that sounds rather simple for leaders to implement, that because it’s what any leader should be doing regardless of the business climate. Consider it both an edict and much-needed encouragement that weathering the storm, as unpleasant as it is, is a test that every good leader can pass.