During my many years as a business change consultant, I have recommended and advised hundreds of companies about business reorganization. Changing a business has always been met with resistance. Sometimes fierce resistance. Almost always compromises are made to soften the changes and dilute the impacts. Business people, or should I say, all people, simply hate change.
However, as a result of COVID-19, change is now mandatory. It is no longer an option. And, it must be dramatic and severe, the days are past when compromise is possible. Decisions must be made, and fast.
There is no escaping the requirement to transform your business. It is now a situation to adapt or die. Companies are facing new issues and different challenges that in their wildest dreams they never imagined could even exist.
With business losses mounting by the week, cash flows evaporating by the day, and revenues slashed by 40%, 65%, or more, it is truly a whole new world. A world that is so foreign that decision-making is fraught with extreme risks. Even the smallest decision contains excessive risks. Risk is everywhere and every step you take can make or break your company. These are not times to bury your head in the sand and hide. It is time to make bold decisions and to act decisively. The stakes are high. Speed is essential to survival. Hesitation is death to a company now.
There is no doubt that we will lose many respected companies due to the Coronavirus. Some industry sectors will be hit much harder than others. Examples include: airlines, hotels, restaurants, gambling, movie theatres, live sports, cruise lines, shipping, movie making and television production, automakers, oil and gas, retail, high tech, conventions, food services, theme parks, gyms, construction, and transportation. In truth, no business is totally immune to the pandemic and the longer it rages, the more it will impact us all.
So, it is rather disheartening to watch some of the younger generation disregard the rules and jump backwards with house parties, beach gatherings, and bar-hopping. Often these actions are hidden and covert, yet the pandemic statistics ultimately reveal them to public scrutiny. Surprisingly, it is this same generation that exposes these transgressions with social media tweets and posts. They out themselves!
The older generations are not above reproach too, they are making serious mistakes as well. They steadfastly resist the rules, foregoing isolation, think that wearing masks is ineffective or even harmful, while they violate social distancing, and even disregarding quarantine orders. Some of the older citizens adamantly defy the governmental rules with some righteous, unjustifiable belief that they are being harmed or violated in some unethical, tyrannical, or conspiracy manner. They are not actually losing their rights, which are not technically god-given rights at all. They are rights given by society and so these short term adjustments need to be respected too. They just need to respect others and function as a a part of community fabric to help contain the virus. So, their endless rhetoric is seen as absolute nonsense. By disregarding the rules, they are amplifying the virus and causing the economic recovery to get pushed further away.
Regardless of the age demographic or the applied rationale for supposed freedom logic, every negative action prolongs the pandemic and adds to the risks applied to our society promoting the continued decay and destruction of corporate enterprise. We must change our ways to save our communities. Save our companies. Save ourselves. This is an all out war to fight this pandemic. But, it is a war fought hand-to-hand inside our own communities, and even in our own homes and schools – not in some far off land. There is no time, nor tolerance, for defiance or resistance to join the fight against the virus. Everyone must comply, or none of us will win this war.
Business transformation and the need to re-imagine companies is required to reshape these businesses to the new normal. It is statistically unlikely that we will ever return back to what once was, so change is now upon us all. Businesses must be scaled down to survive. Product lines need to be reconsidered and streamlined. Services need to be modified to reflect the customer’s needs. And human touch points must now be eliminated to protect health. The cost models must be revisited and revised to include the changes to fund these new products, processes, and procedures. Cash flows need to be stretched and financing must be secured for the longer term horizons, even as banks try to shorten every contract for the sake of their own agility. The money pressures will make this transformation frustrating and hard-fought. It is mortal combat within the company trenches as we struggle for our very survival. This is our Armageddon; our day of reckoning.
What will companies look like tomorrow? How will future incomes fund our families and our futures? Many questions are largely unanswerable right now while the virus rages on. It is only when we get it under control can we start to see how our new universe may be reshaped.
We can expect to see some themes to resonate post-pandemic and they are:
- More savings and less spending – building cash reserves and be able to survive gaps or reduction of income will be mandatory; buying fancy and frivolous stuff will be shunned
- New supply chains – buy local and purchasing domestic goods will be popular and blind dependency on foreign vendors will be deemed too risky going forward
- Small business looks far scarier – legal liabilities for small business may force many out of business, finding employees, and funding these smaller companies will be harder, much harder
Fears related to our inability to effectively end the first wave and realistically stifle a second wave are increasing. We must gain an advantage over the Coronavirus before any planned changes can take root to stabilize the world’s economies.
Deconstructing the economies and then reconstructing them is necessary. Regionalization of economies with a divide and conquer approach seems to be the smartest approach, as not all geographic areas and markets are in the same situation.
Will we return to a rural driven economy? The rural areas have natural isolation and have been less impacted compared to dense urban areas.
Getting a vaccine seems to be the key to turning the corner and rebuilding our economy. But that will take time to develop and many estimates see it for late 2021 or early 2022. So, it is best to simply endure, obey the rules, and live life on hold until such a time as we can all rejoice and live life to a richer level someday in the future. Hope is important, but cooperation and compliance is the way now. This is the way!
About the Author:
Michael Martin has more than 35 years of experience in systems design for applications that use broadband networks, optical fibre, wireless, and digital communications technologies. He is a business and technology consultant. He offers his services on a contracting basis. Over the past 15 years with IBM, he has worked in the GBS Global Center of Competency for Energy and Utilities and the GTS Global Center of Excellence for Energy and Utilities. He is a founding partner and President of MICAN Communications and before that was President of Comlink Systems Limited and Ensat Broadcast Services, Inc., both divisions of Cygnal Technologies Corporation (CYN: TSX). Martin currently serves on the Board of Directors for TeraGo Inc (TGO: TSX) and previously served on the Board of Directors for Avante Logixx Inc. (XX: TSX.V). He has served as a Member, SCC ISO-IEC JTC 1/SC-41 – Internet of Things and related technologies, ISO – International Organization for Standardization, and as a member of the NIST SP 500-325 Fog Computing Conceptual Model, National Institute of Standards and Technology. He served on the Board of Governors of the University of Ontario Institute of Technology (UOIT) [now OntarioTech University] and on the Board of Advisers of five different Colleges in Ontario. For 16 years he served on the Board of the Society of Motion Picture and Television Engineers (SMPTE), Toronto Section. He holds three master’s degrees, in business (MBA), communication (MA), and education (MEd). As well, he has three undergraduate diplomas and five certifications in business, computer programming, internetworking, project management, media, photography, and communication technology. He has earned 20 badges in next generation MOOC continuous education in IoT, Cloud, AI and Cognitive systems, Blockchain, Agile, Big Data, Design Thinking, Security, and more.