Creating a Plan to Recover and Thrive

The Importance of Planning and Preparation

Learning from the past is the best way to prepare for the future. So, before we discuss recovery and moving forward, businesses need to reflect on their reaction and decisions during the crisis. Analyzing the positives and negatives of your response will shield you from other unforeseen, unpredictable events.

Start by making a list of things you did well during the pandemic, as well as things that need improvement. For instance:

Positive: Everyone in my organization already had laptops, so working from home was a much smoother transition. Negative: We had several new hires that didn’t receive proper training because we had to react quickly to the stay-at-home orders.

The process of reviewing your response to this crisis will be enlightening. Compare your decisions against your business continuity or disaster recovery plans to measure your success. If you’ve never created these plans for your business, it’s never too late to start. Use the COVID-19 pandemic as a learning experience and create a plan to protect your business in the future.

If you did have these plans in place, ask yourself the following questions:

• What decisions helped your business survive the pandemic and quarantines?
• What decisions negatively impacted your ability to survive the crisis?
• How can we be better prepared for a situation like this?
• What factors do we need to add to our business continuity plan?

A business continuity plan is never perfect. Make adjustments, add important information, and continually tweak it as you move forward. For example, we didn’t have a strong communication section in our original plan. We realized that we needed a method for our entire business ecosystem to be informed, which will strengthen our response in subsequent crises.

Workplace Adjustments

As we prepare to return to work, we will need to accept this new reality and make adjustments. The health and safety of your employees needs to be a top priority at all times. Here are a few things you may need to consider as we embrace this new normal.

More Robust Sick Leave/Workplace Safety

It is very common in American culture to come into work sick. Some people are even praised for doing so. Now if you so much as sneeze in public some people feel entitled to shame you. With that being said, it’s clear we’ll need to institute more robust sick leave policies, in many cases according to state laws. With our eyes being opened to the deadly nature of unknown diseases, businesses will be responsible for supporting employee safety in the workplace and those who need more time to recover from illness. Instituting policies for your employees to wash their hands throughout the day, clean their desk areas with wipes before leaving for home, and installing hand sanitizer stations may become common practice to optimize cleanliness. No more handshakes in the office, or even elbow bumps, to minimize human contact.

New Work-from-Home Policies

Was your business forced to adapt to a remote workforce? Has it been positive or negative? What have you learned? Even with government restrictions being lifted, there will still be a need for remote work to provide enough space for social distancing in the office. You may need to support employees that aren’t accustomed to this new lifestyle. For instance, some of our employees didn’t have Internet access, so we had to find a solution to allow them to work from home.

Updated Communication Policies

Government restrictions are being lifted little by little, but things will not immediately go back to normal. As you adjust to a more long-term remote workforce, leveraging technology can significantly optimize your business. Communication and collaboration are critical to move your business forward during this time. And although some technology isn’t “new,” it might be new to you and your organization. WhatsApp, Google Hangouts, Zoom, Slack, Asana and more are some examples of communication channels that can help centralize your efforts.

Short-term and Long-term Financial Decisions

The most important question is: Do you have enough working capital to continue as is? As you analyze the financial impact of this pandemic, you’ll need to keep a close eye on budgets and liquidity. There are several options for businesses in need of immediate cash flow, such as:

• Paycheck Protection Program
• Low interest loans
• Other government programs
• Reduction in force (RIF)
• Bankruptcy filing (in extreme circumstances)

Here are some additional insights to consider as you assess your financial decisions.

Layoffs

Sometimes there is no way to avoid layoffs. But if you have the liquidity and ability, I’d recommend avoiding layoffs. Many business leaders think layoffs will immediately ease their financial pains because they won’t have to cover payroll. However, you may still have to pay out severance, benefits, sick time, etc. which can be expensive all at one time. Many other countries outside of the U.S. also have extensive employee protection programs, which will further drive up your costs.

Research has also indicated that businesses avoiding layoffs during a recession recovered faster and performed better than their competitors. A big reason for this is the cost and time it takes to rehire and train a new workforce. And if you lay off people thinking you can rehire those same people… think again. Those employees will remember how you treated them and find other employment.

There are some short-term alternatives to help with financial strain you may be feeling. This would include work hour reductions, furloughs and performance pay. An example of this might be to explain to an employee that they’re going to get a pay cut, but you’ll make it up to them after the business recovers. Make sure to set timelines for how long these adjustments will last. Create measurable events to determine if things start to turn around and establish expectations with those employees. Clarity of communications and measurable milestones builds loyalty.

Price Reduction Opportunities

If you have extra liquidity available in your business, now is a great time to take advantage of lower costs for products and services. We recently purchased a membership into an organization for a 60% discount, because no one is signing up for anything right now. We’ve been thinking about joining for a while now, and with the decreased costs, it gives us access to incredible opportunities. So if you’ve been considering buying something for a while, capitalize on price reductions if they’re available.

We’ve also been preparing to switch accounting systems for several months. Under the circumstances, now is an opportunity to negotiate terms and invest. Implementing better systems, technology and products will make you and your business more resilient in the face of future challenges.

Make sure to utilize technology to innovate and adapt for the future. Look at existing technologies you might have avoided or ignored in the past. How can you use those tools differently? Or how can you use technology to accomplish feats that have never been done before? Sometimes it’s not about buying the latest technology, sometimes it’s about using existing technology in an innovative way.

Maintaining Cash Flow

You may need to get creative in finding ways to inject money into your business in the short-term. Here are a few questions to consider as you pursue these actions:

• Can you borrow in the public market?
• Can your current investors put more money in?
• Can you find new investors?
• How can you mitigate liquidity issues? Put in more money from your personal accounts. Request money from the bank if they are still lending.

I hope these guidelines and recommendations will help you and your business as you prepare for things to return to “normal.” Be sure to connect with me or the Global Upside Team if you have any questions.