Everything has changed in the flash of an eye. What was normal and taken for granted two months ago; booking a holiday overseas, meeting friends, going out for a meal is now no longer possible now we are all placed in lockdown. Whilst this is impacting our personal lives it is commerce that is really feeling the impact.
Clearly some businesses are busier than ever (food production, hand sanitiser producers, PPE and Ventilator manufacturers, social care etc) but many organisations have used the Job Retention Scheme to furlough staff and are anticipating a significant reduction in revenue and profit. The Chancellor recently announced that he has expanded the £330bn coronavirus loan scheme to cover all financially viable UK businesses regardless of their size.
The leap that many businesses had to make from full-time office working to working from home was a test of how modern their working practices and indeed culture were. Some firms still had out-dated working practices that included desktop computers, administrative staff co-located to type things and no central electronic filing system on the cloud. Others that had invested in systems and engaged with new technology adapted easily and quickly got into a routine. The biggest issue however has been trust. Some firms have struggled with this and put effort into creating systems to check that staff are working which usually creates the opposite effect; others have hit the ground running with laughter.
Speaking to a partner in a Top 10 accountancy firm, he reported how Covid-16 has changed the way they do business forever. Previously they would organise face to face networking events and struggle to get 15 bums on a seat, whereas they have had to rapidly produce high quality digital content and run webinars that have seen thousands attend.
Rentokil, a FTSE 100 company and a well-known British brand globally, has seen a downturn over night as they can’t gain access to client premises which are mostly closed. So, they are anticipating that when businesses can return to their buildings, a full deep clean will be required of offices, shops and even passenger transport. Currently they are re-training their 7000 staff to enable them to be ready when the work is there.
Organisations are also looking at how they can cut the fat but not the muscle, so they emerge leaner and better able to compete. This unfortunately means redundancies, and in some cases outsourcing services like HR, Payroll, Training, general administration, IT and marketing.
During the 2008 recession Apple, Cisco Systems and IBM all downsized by outsourcing non-core services including manufacturing and IT and survived the economic downturn and it is anticipated that a similar pattern will follow this time.
YOUR COVID-19 RECOVERY PLAN
Now is the time to think about your recovery plan. Does your business model still work? Do you need premises and/or a presence on the high street? Can you cut costs by working remotely more? Do you need the same staff or different skills? How will you find those skills? Can you retrain your workforce? What will your package look like. Will you use flexible labour like contractors? Will you outsource any services?
If you would like to discuss your recovery plans further please contact us for a no obligation chat. 01453 548070 or email [email protected]