What doing business in the times of COVID-19 induced crisis taught me

Human history has witnessed many a pandemic over the last hundred years. Each pandemic and its aftermath on the economy is unique, owing to its time and place in history. As we grapple with the unparalleled uncertainty that surrounds the outbreak of COVID-19, I believe reflecting on how previous pandemics panned out and the dent they made to the economy will give us some perspective on defining better and far more effective coping strategies so that public health and business continuity – both are taken care of.

Significant pandemics and their economic impact

Let us first rewind to:-

• 1918 when a pandemic called Spanish flu – a variant of H1N1 influenza - is estimated to have killed 50 million people or the equivalent of 2.7% of the world’s population
• Another significant pandemic in public memory is the SARS virus, identified in 2003, which affected over 8000 people, killed 916 people and lasted well under a year.
• In the spring of 2009, the world woke up to H1N1 virus or the Swine flu which infected 1.4 billion people - comprising almost 24% of the world’s population - and killed over half a million people within a year.

Now that we have identified significant pandemics, I would like to highlight the economic impact of each pandemic in quantifiable terms:-

• The 1918 pandemic killed around 10-17 million people in India alone and economic historian Angus Maddison reported that India’s GDP declined by 12.8% that year.
• Industry reports suggest the outbreak of SARS in 2003 resulted in revenue of Asia Pacific carriers plunging US$6 billion while North American airlines lost US$1 billion. Tourism to Singapore fell by 70% & the GDP of Singapore took a $400 million hit. The aviation industry across the globe was largely grounded which resulted in the demand for oil dropping by 300,000 barrels a day in Asia.
• Analysing the impact of the 2009 pandemic, a study by economists at the Brookings Institution revealed that closing K-12 schools in the US for two weeks, as a prevention, would result in lost economic activity worth anywhere between US$5.2 billion and US$23.6 billion.

The above data is important as it provides an insight into the financial contagion that a pandemic gives birth to. As we can see with the COVID-19 outbreak, every part of the economy is gradually witnessing reduced activity and this will impact businesses adversely, irrespective of the size or turnover of the enterprise. However, in this collective battle against COVID-19, I am confident there is learning that every business must make note of.

What past pandemics can teach us

Mark McCormack rightly said “The best people know that there are two phases in every crisis: the one where you manage it and the other where you learn from it. To succeed you have to do both.”

Looking back at my entrepreneurial journey of almost three decades, doing business amidst a crisis like COVID-19 is an uncharted territory. While we navigate the challenges, I choose to focus on what my learning should be. 

Pandemics occur in waves – If you are an entrepreneur, it will be helpful to remember that pandemics are known to occur in waves. When a pandemic spikes, peaks and then dies out, do not believe the worst is over; remember that there is a possibility for resurgence. Hence, it is best that your business is prepared to weather another wave of pandemic, if and when it strikes. 

Stay vigilant and proactive – A pandemic wields potential to offer businesses “a real time crash course in crisis management" and it is imperative that a business is vigilant about its surroundings and proactive when the time comes for decision making.

People are your priority – Human resources are the most essential cog in the wheels of your business. The evaluation of a crisis is of paramount importance as it helps gauge the impact of the crisis on human resources. Make people your priority and empower them to keep your business operational.

Information can make or mar your business - Information is power and more so when a business is coping with a pandemic induced crisis. Building robust and open communication channels between employers and employees is non-negotiable. The onus is on employers to consistently communicate updates from reliable sources & share plans that help mitigate the impact on business operations.

Leverage the power of technology – If there is one differentiator between the COVID-19 crisis and previous pandemics, it is the fact that today we live in an era where technology and innovation offers businesses a chance to drive most of their operations remotely. During the 1918 pandemic this privilege did not exist! It is advisable for every business to utilize technology to engage with employees, monitor progress, and even conduct face to face meetings using Whatsapp/Wechat/Skype at the click of a button, and resort to austerity measures during the ongoing crisis.

Conclusion

The outbreak of COVID-19 is an ongoing human tragedy which is hurting the global economy. There is no definite answer on how to deal with this crisis. However I believe today, more than ever before, each individual needs to condemn hysteria inducing fake news, stay positive and look at the brighter side of things.  

 Sources: (Bloomberg, Economist, Reuters, Healthline, WGNTV)