No crisis is a manageable event that affects only one part of the economy, a chain or an organisation. That certainly applies to the Covid-19 outbreak. Your current business plans may not be based on the rapidly changing and unknown variables of the current pandemic. That is why this crisis also requires strong intervention and leadership that suits the circumstances.
- Get a grip on your liquidity position. 'Cash is king' is more important than ever.
- Make a good scenario planning. This is crucial given the uncertainty about the duration of the crisis and the economic conditions.
- Focus on communicating effectively with your stakeholders.
- Plan how to comply with government regulations in individual countries and how to minimize risks to your organisation.
The corona crisis affects your employees and your HR policy. Pension plans can also come under pressure. Note the following priorities:
- Protect your people: Start with measures to support the physical and emotional well-being of your employees, both at work and at home.
- Communicate effectively: Be empathetic and ensure communication and policies that make people feel heard and supported.
- Maintain continuity of work: Ensure your people have the resources and support they need to be productive, especially when working from home.
- Assess personnel costs: Compare the potential need to cut costs against the desire to keep people working.
- Prepare for recovery: Align your workforce planning with your business strategy and prepare for a recovering market.
Liquidity, finance and state aid
Due to the corona crisis, your liquidity can quickly decrease. Your business activities are reduced or stop altogether, causing your cash flow to dry up. Taking fast and thorough action is crucial. Over time, the options you have to avoid a liquidity shortage decrease.
- Review the scenarios to assess the impact on your liquidity and update it regularly.
- Map out the financial and operational opportunities to save and generate money.
- Find out which government measures you can appeal to.
- Make an inventory of the impact of the corona crisis on your financial reporting.
Tax and regulatory
Because of the current uncertainties, many governments have taken special tax measures. In the Netherlands, affected organisations may be granted deferral of tax. Employers can apply for a contribution towards wage costs. You can also take action yourself.
- Effectively manage your taxes by minimizing taxable income, obtaining available refunds and reducing required tax payments.
- Assess the resources your organization needs to meet the indirect and direct tax compliance requirements.
Strategy and brand
After your initial response to the coronacrisis, which undoubtedly focused on the safety and well-being of your people, you will need to look further to minimize the impact of the outbreak. Renewed (market) strategies to become stronger again than shown.
- Consider accelerating digital transformations. Working from home may have revealed gaps in your IT infrastructure, workforce planning or digital training. Get them out.
- Improve your resilience through market analysis and (strategic) scenario planning and adjusting financial models. Process the economic effects of the pandemic in new models.
- Communicate with your customers and map out whether their wishes have changed as a result of the crisis. Adjust your long-term strategy and business models accordingly.