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The COVID-19 pandemic is a worldwide crisis, and as corporate leaders, we must make sure certain steps are taken to restructure our businesses and make plans to react to and recover from how severely our businesses have been affected. These suggestions are based on the countries that were 1st impacted by COVID-19. Firstly China, Asia, Europe, and America have been severely hit by the virus with catastrophic impacts on countries' economies that directly affect the various businesses and way of life in general.

  1. Prioritize Peoples Safety and Continuous Engagement

    People are looking at their employer, community, and government leaders for guidance. As employers, it is our job to ensure the safety and wellbeing of employees in the workplace is of utmost importance.

    • Contingent to the sector, companies have to make arrangements on initiating flexible policies that will allow people to work remotely and safely, one way could be scheduling flexible working hours.
    • Where telecommuting or flexible work arrangements aren’t conceivable and companies must have workers on-site or in direct contact with customers, it is important to provide infection protection measures.
    • Providing protection measures that employees have to follow when they meet with customers or have to be present at the workplace is in the best interest of companies.
    • It is advised that companies provide data that aligns with the current government and health authorities’ policies to assist employees in remaining involved as they and the company circumnavigate their way around the COVID- 19 epidemic.
    • Some governments are exempting social and rental payments in part or in full. Working along with technological companies and mobile operators, a health QR code has been created whereby an individual can track where they have been the last 14 days.
  2. Restructure Strategy for Business

    Most businesses are more than likely going to face underperformance throughout COVID 19 pandemic. In the beginning, the disruption was felt especially with countries that had dealings with China, as COVID-19 continued to spread to the US and Europe, there has been a monumental shift in consumer behavior and demand impacting customers, sectors such as retailers, manufacturing, tourism, airline, transportation, and pharmaceutical industry just to mention a few. and many companies are experiencing operational disruptions. For instance, most hotels in Tanzania have been forced to close down due to lack of tourists.

    As leaders in our respective businesses, it is of extreme importance to be able to identify potential risks, companies should maintain frequent communications with their suppliers throughout the pandemic. Assess short-term liquidity, teach short term cash flow monitoring discipline that will allow you to predict cash flow pressures, and intervene promptly.

    Companies that do not react on time risk financial stress that could have long term implications. Therefore it is vital to evaluate operational and financial risks and respond quickly. Monitor how the profit and product margin is affected by the direct cost escalations. If the situation becomes critical it is advisable to intervene ad renegotiate.

    Just as companies need to monitor their in-house weaknesses, observations on the pressures affecting some of our customers, suppliers, partners, etc have to be made. Depending on the sector, companies may want to check on their suppliers and how they have been impacted but most importantly, be aware of any agreement breaches with banks and other financial institutions relating to impairment risks in asset values, which may negatively impact the overall balance sheet.

    Short-term capital demands for on-going business operations is an area of focus. Based on the results of the valuation, companies may need to look at debt refinancing or additional credit support from banks or investors, policy supports from the government, near-term capital raising. Review of overall operating costs and consider slowing down all non-essential expenses is needed.

    Consider different supply chain options. Companies that depend on suppliers to supply them with parts or material in areas significantly impacted by COVID-19 will want to look for alternatives. For example, Nike was considering moving its shoes and apparel manufacturing factory to Vietnam or Malaysia from Hubei province capital of Wuhan, which was under lockdown. Such moves will create a temporary capacity to meet consumer obligations and should think about post-crisis scenarios in case demand goes through the roof.

    Companies need to determine to what extent the COVID-19 virus is affecting business plans and budgets. Companies will have to consider minimum operating requirements such as dependencies of the workforce, vendors, location, and technology. It would be wise to test the financial plans for various scenarios to understand the potential impact on the financial performance and evaluate how long the impact may continue and if the impact is significant. Companies need to revise their business plans and budgets to remain agile. It is essential to look at near-term capital raising, debt refinancing, or additional credit support from banks or investors and policy supports from the government. Companies will also need to review overall operating costs and cut non- essential expenses.

  3. Communicate with Pertinent Stakeholders

    When creating a platform to reshape the business, it is of utmost importance that the lines of communication channels are open and timely to gain support from customers, suppliers, investors, banks, employees, and government institutions.

    • Customers- keep customers informed on any impacts on product or service delivery. If contractual obligations are not fulfilled as a result of supplier or production disorder, it is important to uphold open lines of communication to revisit timelines or raise “force majeure” or “act of God” clauses. When pre-emptive action is taken, this will assist in avoiding retributory damages or liabilities related to disrupted customer obligations.

    • Employees- communication channels should try to find the equilibrium between caution at work and a “business-as-usual” mindset.

    • Supplier- It is vital that frequent communication with suppliers concerning their ability to deliver goods and services amid the COVID-19 crisis and their recovery plan. This will help the company find timely alternatives in the event the supplier cannot meet the requirements.

    • Creditors and Investors- Companies must review terms and conditions on loan contracts to pinpoint sensitive debts and evade critical technical debt beaches. By doing so, it will allow companies to be hands-on in managing the communication with creditors, banks, investors regarding any necessary amendments to existing terms or refinancing arrangements.

    • Government and Regulators- Companies will want to consult with their teams to advise on possible liabilities and with their business units regarding how to manage communications around ongoing breaches and collection of evidence.

  4. Exploit the Use of Government Support Policies

    Companies should monitor nation-wide government and organizational opportunities for support and how they best serve the individual circumstances of their situation. As corporate leaders, we need to identify and understand each offer of support and determine which best suits our organizations. Central and Local governments in China have several social insurance, tax-related policies, and financial to support companies. Here are a few actions that have been taken:

    • Providing an individual income tax (IIT) exemptions on bonuses and allowances relevant personnel receive for treating the epidemic.

    • Relieving and refunding value-added tax for enterprises providing certain services for epidemic control or manufacturing key epidemic relayed necessities.

    • Delivering policies that inspire public-benefit donations

    Countries like Singapore and Japan are following suit. Companies ought to take advantage of the availability of these kinds of programs and use them to diminish the risk they face.

  5. Build flexibility in preparation for the new normal
    • Top management must report any material deviation from the plan on time so that their companies can take additional action to circumvent further negative impact. Once companies have solidified strategies and conversed any new directions with relevant stakeholders, they will need to execute based on revised plans while observing what continues to be a fluid situation.

    • When the COVID-19 outbreak is under control, companies will want to assess and renew business continuity plans (BCP). They’ll want to review how current BCPs are working. If there are inadequacies, companies will want to pinpoint root causes, whether it’s the timeliness of action, absence of infrastructure, labor scarcities, or external environmental issues. Companies will then want to reflect on putting new internal procedures in place based on lessons learned, as well as solid emergency plans to build flexibility and better respond to future crises.