BUSINESS leaders across the Philippines should be ready with the right strategy to outperform their industry peers as they prepare their recovery plans post the new coronavirus disease 2019 (COVID-19) pandemic.
Marivic Españo, chairperson and chief executive officer of P&A Grant Thornton, said companies that adopt more quickly to the initial transition—and, eventually, to the new environment—will emerge stronger.
Españo said the actions they take now and in the weeks ahead—especially as quarantines are modified or loosened—will define them and their companies.
“Even if the impact of the COVID-19 pandemic varies across industry sectors and regions, it is no exaggeration to recognize that the struggle is real,” she added.
Grant Thornton culled the following elements essential in shaping the new norm: workforce, capital and resources, operational model, and supply chain.
During these uncertain times, businesses must assess their plans and realign their activities to adapt to the new rules prescribed by the government. “Businesses must be willing to try new practices, switch to better tools, and update action plans for the short, medium, and long terms,” said Españo. “Updated processes will help businesses adapt to a changing market and set them on track to a brighter future,” she added.
Capital and resources
Pre-COVID-19, cash budgets were calculated monthly. Since the coronavirus crisis, however, organizations have been reviewing their cash assets as often as weekly. How do you budget your organization’s cash during such times? First, project your accounts receivable realistically and review other cash sources. Next, list down all your expenses and other cash outflows. Finally, analyze your accounts payable to suppliers, taxes, and payroll from the previous period.
Rethink your operational model and allow the business to adapt. In the long term, think about implementing process automation and integrating technology into operations. When reviewing business activities, consider the shift to Industrial Revolution 4.0 or digital transformation. “Set new business goals with such changes in mind, make informed decisions, and take advantage of every opportunity. Dare to innovate,” said Españo.
When a crisis such as COVID-19 hits, organizations need to reinforce their supply chain to continue meeting customer and client demand. Securing your supply chains is paramount. It is done by assessing the situation quickly and then moving forward with an action plan aimed at preventing problems and implementing solutions. Monitor inventory levels as well by establishing critical inventory thresholds and building stockpiles, as needed. Likewise, strengthen relationships with customers by finding alternative shipping methods, adjusting delivery schedules, and being transparent about your challenges. Lastly, cement supplier relationships by controlling your cash flow and negotiating payment terms.
The uncertainty that is this far-reaching makes it challenging to control the challenges at hand, let alone in the years ahead. It is imperative to reconstruct for the future and not solve the problems of the past.
Companies have begun to consider their return to health. For most, the pre-pandemic business as usual won’t be nearly enough. To move beyond survival mode, organizations need to think beyond their defaults, reimagining how they recover, operate, organize, and use technology, setting the foundations for sustainable success. In a twist of irony, a crisis like this coronavirus pandemic brings new opportunities and should be a trigger to explore new directions.
As published in Malaya, dated 22 May 2020