“Bouncing Back from Adversity” Article Series #4

Overview

It’s Easter Sunday today and it is the first time in modern human history that many churches will be closed for service due to the lockdown imposed on more than 50% of human population. The death toll of COVID-19 exceeds 100,000. It is indeed dark times that most of us have not faced before.

In a rare appearance of Queen Elizabeth II, she reminded us that: “This year, Easter will be different for many of us, but by keeping apart we keep others safe. But Easter isn’t cancelled; indeed, we need Easter as much as ever. The discovery of the risen Christ on the first Easter Day gave his followers new hope and fresh purpose, and we can all take heart from this,”

In his Easter message, Pope Francis reminded us to “be messengers of life in a time of death!”.

Indeed, more than ever, we need hope to carry on for another day. We need hope to tell ourselves that it is OK and necessary to stay at home. We need hope to believe that humankind will find a solution for this crisis!

Introduction

I had my fourth interview on April 2 with the Regional HR Director APAC for a global luxury retail company. He is an Italian who live in Asia for more than 15 years. Due to internal communication policy, he will remain anonymous for this interview.

Here are the excerpts from our interview:

Ricky “R”: What is your overall perspective on the Covid-19 pandemic situation?

Interviewee “D”: First, we tend to forget how our world is connected. There are no real borders. The discipline in China to manage the crisis, which unfortunately we don’t have it in Europe, especially in Italy; and it is hurting us.

Meanwhile, I’m positive. The crisis help people to go back to basics: stay with the family and stay healthy. Things that we take for granted (e.g. playing outside at the park), we can’t do it now. I have friends in Italy who cannot say “we go play football together”. Psychologically, it is a total disruption to our routines at home and at work. I hope that when this crisis is over, we start to appreciate more about what we took for granted – things that we can’t do now.

The third thing is that, we can close our border, cancel visas, but the reality is that the virus doesn’t respect borders. There is a need for coordination when it comes to a big crisis. Unfortunately, politics is complicating the situation.

R: Are you referring to racist treatments?

D: Let me share with you a few stories.

When I was taking a taxi in Singapore, I was talking to the taxi driver, a friendly guy. When I told him that I’m from Italy, there was an immediate change. He took out his mask and put it on. Crazy!

When I told him that I’m from Italy, there was an immediate change. He took out his mask and put it on. Crazy!

On another occasion, I went with my mother to IMM (large shopping mall in Jurong East). The shop attendants was super keen to sell us something. When they knew that we are Italians, they immediately stepped back… they are not sure how to behave. We had to assure them that we are in Singapore since December.

In Florence, which is the centre of the textile industry, where the manufacturers of Prada and Gucci are based. There are 25,000 Chinese living in Florence who works for the industry (an estimated 310,000 Chinese people live in Italy). When the COVID-19 news came up, people in the town were saying that we should stop them and they shouldn’t come back to Florence.

When the Chinese returned to Italy, they imposed self-quarantine by themselves for 15 days. However, when the Italians came back, we do nothing! When you ask Italians to quarantine themselves at home, they say they can’t do it. “I need to go for a run!”.

Impact to business and supply chain

R: What is the impact to your business and supply chain?

D: We are in the luxury retail business and we have never lost so much money in the worst economic crisis previously. In same countries We are experiencing a sales decline of 80-90%.

In the region many countries are in full or partial lock-down as Singapore, Malaysia and Thailand and sales are near to zero. In the U.S. and Europe, it’s very bad. The situation is rather extreme for us.

As the governments are closing the malls, we cannot open our stores.

Take the time to develop people

R: With the disruption, how is it affecting your HR work?

We need to be ready by investing now in their skills, in order to be ready later.

D: We have implemented a worldwide hiring freeze two weeks ago. Every new hiring needs board approval, which means it is almost impossible. Even for resignations, there is no replacement. We will stretch another person to cover the work.

As a company, we are under pressure now and we need to manage cashflow. In Marketing, there is nothing that they can do.

We take the opportunity to focus on talent development, in learning new skills. We had a staff who was working in the back office as a personal assistant. Now, we moved her to support marketing as the incumbent is on maternity leave. We are practicing dual-hatting.

In the stores, we are doing the same. We reduce the number of FTEs (full time equivalent) and we move people around. We reduce the working hours.

As we have more time now, we invest for the future. We are developing new systems for our performance appraisal. We try to spend the time on development plans. We do more training – many in the sales force are doing online training. Now, we can push our online academy.

I think it is very important that we prepare ourselves for the rebound. The crisis may go on for 3, 4, 5 months. However, we are experienced a drop not because customers change their mind about our products. We are not selling because our stores are closed.

We need to be ready by investing now in their skills, in order to be ready later.

R: Any updates about China?

D: China is catching up. In terms of production, they are achieving 100% efficiency. The supply chain is coming up as well. We see that sales are starting to catch up. It is interesting to see that in some the cities that are open, people are slowly coming back to shop. We are not sure yet whether this is temporary or permanent.

R: How are your partners reacting? How are you working with your partners?

D: Our business is B2B (business-to-business). Orders have reduced and our partners are still processing orders. In Singapore, the orders have decreased but not yet stopped. In countries that in lockdown (e.g. Malaysia), the partners stopped their orders and shipment. Also, in Australia and New Zealand, the orders dropped dramatically. All businesses want to reduce their stock. Now, companies want to keep their cash. Cash is king!

In some situations, we are taking back the orders. Even when shipment is already done. We take back what we sent.

Everyone is delaying payment.

The crisis speeds up work from home arrangement

Caption: The author's Work From Home arrangement.

R: Where do you see the opportunities in the current situation?

Next year, when things resume to normal, staff might ask: “can I work from home for a week?”. We will be ready to say yes.

D: We push on how to work smart. We teach people how to work from home and show them how is it possible. We look at the performance. At the moment, 90% of our employees are already working from home.

As managers, we asked ourselves: “Are we able to manage our team remotely? Where are our gaps?”

If we invest during these times, e.g. in software, we will be better equipped in the future.

Next year, when things resume to normal, staff might ask: “can I work from home for a week?”. We will be ready to say yes.

In November last year, people are asking, “can we work from home for 2 weeks?” People will say, VPN is low. People are reluctant to change. But you can actually do it.

From commercial standpoint, we can see that who is more or less committed when they work from home, as there are thousands of distractions at home. We have not yet seen any big cases. They are some colleagues who ‘need to be chased’.

R: How do you measure their performance? Do you use any tools?

D: We thought of using some time-keeping tools, but we don’t want to be a Big Brother. With my team, I have daily moments with them. We arrange a schedule of duties. I make it clear on what do we expect today or by this week. I can track that they are doing. Setting precise deadline is more important than before. Without day-to-day interaction, we don’t see the staff. We need to set priorities and be more precise. If we are not precise, it’s easier for people to be distracted.

Advice for business leaders

R: What advice do you have for business leaders?

D: Any crisis presents opportunities. In this case, how you act with the people, how you show care right now, will bring commitment later, when we are ready to recover the losses. Layoff is the last resort.

If we treat our staff as a number now, you may save more costs now, but people will leave when things are better.

Keeping regular communication is very important. We need to make our staff aware of what the company is doing to save costs. We help them to see the bigger picture relating to saving costs. If we treat our staff as a number now, you may save more costs now, but people will leave when things are better.

If there are two companies, one which immediately layoff everyone in an emergency and another who still try to take care of the employees in a crisis, people will surely stay in the second company and not the first.

Conclusion

I’ve known interviewee D as a client and candidate for many years. He is very business-oriented HR business partner whom I can spar with. His inputs reminded me to treat people with more care during crisis time, so that people remain loyal after a crisis. He also helped me to put things in perspective that consumer demand will return when stores are open again. It is important that managers set clear and precise deadlines for their team members in order to monitor progress and to measure performance.

If you are interested on how to build a resilient leadership team in APAC, drop me a note at [email protected]. I'm happy to connect with you via a video call.