Dr. Anthony Fauci, the nation’s top infectious disease expert, recently said the US might not see “some semblances of normality” until 2022. His comment sent an important message to all business leaders: act now to ensure your company does not become another casualty of the coronavirus crisis.
“Many corporations are experiencing a 360-degree impact on their businesses due to the pandemic — from production and supply chain disruption to shifts in how and where workers do their jobs on a daily basis — and they will continue to do so as we head into the winter months,” according to Faisal Pandit, President of Panasonic System Solutions of North America.
Corporate executives may not have been paying as much attention as they should have to the steady drumbeat of headlines about the Covid-19 and the recent resurgence of the disease.
Most business were surprised by the pandemic, according to Timothy Williams, vice chairman of Pinkerton, a crisis management, business, continuity, risk management, and security services company. Why? Because “…they did not have or adequately practiced their crisis management planning based on the structural and variable risks present for their specific businesses.”
Or perhaps business leaders did not know what to believe. Maybe they still don’t.
Dr. Sharon Alvarez is the Thomas W. Olofson Chair in Entrepreneurial Studies in the University of Pittsburgh’s Joseph M. Katz Graduate School of Business. She noted that, “Business leaders are faced with making crucial decisions based on an ever-changing mix of no news, fake news, no data, bad data, and misleading data. What’s believable and what’s not? Too often that can’t be discerned until it’s too late. Will the world return to the way things were pre-COVID, or is it permanently changed? That, too, remains to be seen.”
Follow The Facts
One option for executives is to follow the facts that they know, can verify, and trust.
Business leaders should focus on analyzing and evaluating data to help figure out what works and what doesn’t, according to Vanessa Matsis-McCready, assistant general counsel of director of human resource for Engage PEO, which provides outsourced HR services. Then they can plan for the future and decide “…how to best utilize the worksite and how to integrate a distributed workforce into their plans,” she said.
Analyzing the data and following the facts is exactly what PJ’s Coffee of New Orleans did. Even before the pandemic, executives at the national coffee shop chain said they saw that their drive-the locations were generating about 30 percent more revenue compared to their non-drive thru sites.
But what was driving the change?
“The most noticeable consumer behavior change was induced by the COVID-19 pandemic,” said Ryan Stansbury for Ballard Brands which includes PJ’s Coffee of New Orleans. “We were able to clearly see the trends through data analysis — we are able to extract data from the point-of-sale systems at all locations to better understand trends. We could very obviously see the direct correlation between the time when COVID-19 hit and the consumer data,” he said.
Their analysis led to action.
“We have placed greater emphasis on the necessity of the drive-thru. We are also evaluating how we can enhance the consumer experience when patronizing a PJ’s through the drive-thrus. Now, drive-thru locations are not only a function of convenience and increased revenue but also a necessity to meet an even greater shift in consumer behavior,” he said.
Ted Sheppe, executive vice president of commercial banking of Axiom Bank, said that in addition to taking care of the fundamentals — such as building cash reserves, taking a hard look at expenses, and seeking alternative revenue streams — consider asking for ideas from others.”When you brainstorm, put everything on the table. Ask your customers and employees for ideas. They will have ideas that work,” he said.
That certainly turned out to be the case for the Black Rooster Taqueria, a Mexican restaurant in Orlando, Florida, and one of Axiom’s clients. Sheppe said that as a result of a brainstorming session the restaurant invented a “margarita-gram” — a thank-you drink people could have delivered to the doors of friends or colleagues.
“The idea took off. The restaurant generated plenty of sales and buzz — and, just as important, the margarita-gram led to a spike in demand for takeout and meal delivery for them,” Sheppe said.
An Encouraging Lesson
If there is any good news that can be attributed to Covid-19, it may be that the pandemic showed that rapid change is possible. “Programs that were years in the making got implemented in days. People adapted fast, improvised, [and] kept businesses going,” observed Lars Sudmann, former CFO of Procter & Gamble Belgium.
“Very rarely does one see this behavior across organizations. The big lesson learned: Change is possible, despite what people say. The key lesson to be learned in the coming months and years: how can this spirit of change be kept, especially in large organizations,” he said.
But with the recent surge in coronavirus cases and no guarantee when a safe and effective Covid-19 vaccine will be available, what should business leaders do next? And what if Fauci’s comment about when the US might see “some semblances of normality” turns out to have been optimistic?
Stansbury of Ballard Brands said, “While I do believe the current [pandemic] situation is temporary, I also believe this has exposed the vulnerability of many businesses.
“Executives should evaluate their operational weaknesses and identify solutions to become less vulnerable and more sustainable. Start by truly understanding consumer behavior, then evolve the business operations to support and compliment this behavior,” he advised.