COVID-19 has disrupted the private business sector in Ireland. Uncertainty looms large for companies for the foreseeable future. Workforces are dispersed, and customer interactions affected. However, there is a growing acceptance that a 'new normal' will materialise post COVID-19. It will be shaped by emerging behaviours and industry norms, and businesses need to embrace this as an opportunity. The plans and priorities defined during lockdown could have long-lasting effects on business models and revenues.
Over time, a new normal will emerge. Private businesses need to make decisive decisions now and follow through with real actions to give themselves the best chance of success. They need to understand how their industry is changing, and how to adapt now to help get on the road to recovery.
At the outset of the crisis, the main focus for companies was on tax, liquidity and finance. They were encouraged to understand their tax position, and avail of the COVID-19 taxation supports put in place by the Irish Government. Businesses had to assess the financial implications, obligations and options, such as how best to manage and monitor their cash flow position.
While tax and liquidity continue to be key areas, the focus now needs to become broader. To speed up recovery, other key organisational considerations now warrant attention.
Employee engagement and workforce planning are critical areas for any business. Communication is key to protect the safety of staff and to ensure a high level of productivity. It is also important to stay connected with both customers and clients, as they are key to the sustainability of any business. To maintain business continuity, supply chains need to be protected, with an ongoing evaluation of production lines, stock levels and lead times.
With consumer behaviour changing, including a pronounced switch to e-commerce, businesses need to pay more attention to their online offerings. This may need a redirection of resources into this growing channel. Businesses need to gain a real understanding of how to extract value from digital technology and weave it into the fabric of their operations. Developing a digital strategy which aims to win trust from customers, stakeholders, investors and partners will enhance your market competitiveness and consolidate your position in the industry.
In a new competitive environment, you need to assess all risks and opportunities, which includes:
Social distancing needs to be implemented for both staff and customers, to ensure a safe working environment.
The recent surge in online activity requires all businesses to invest time in creating a digital strategy to boost their online presence and offering.
A leaner and more efficient use of internal processes and procedures can help achieve maximum business value.
The lessons learned during COVID-19 will mean business plans need to be continually reviewed and adapted on a regular basis.
Working from home can be of benefit to both the employee and the employer. Proper planning and communication should be put in place to facilitate this.
By adjusting and being proactive during the crisis, some businesses will be in a position to capitalise on the new opportunities that emerge.
Different scenarios present different challenges so it is imperative to gain an understanding of your new value drivers and ensure everyone is aligned. Promote the process of standardisation and simplification, as this will drive agility into teams and enable people to switch between activities as demand allows. Any silos and complexity that currently exist will prevent this.
Perform sensitivity analysis, modelling various scenarios that will highlight potential risks. Assess the capability or limitations of existing reporting tools and systems to allow real time reporting. Continue to update your financial position by instilling a real focus on cash flow monitoring and cost management, which will help predict cash flow pressures.
Support your staff by aligning your organisation to the new normal. Embed revised capabilities and incorporate new ways of working and behaviours. Assess the effectiveness of this approach for employees and adapt as required.
It is important to keep employees up to date on the impact, performance and expectations. Provide additional upskilling and training if and when required. Listen to, and act on, feedback. Evaluate the lessons that continue to be learned from the crisis.
Seek input on future ways of working. In workforce planning, use scenario planning to model staggered returns to work, identifying the potential impacts.
Business and strategy plans need to adapt to cope with the specific challenges of COVID-19. By having a business that is flexible, decisions and actions can be taken in real time to mitigate any exposure. There is a need to assess all risks and opportunities that this new competitive environment presents so the business can accelerate recovery.
With an economic decline forecast for 2020, purchasing behaviours of customers may change. New forecasts should be developed to reflect this.
Create a communications plan to help stay connected and engaged with your customers and clients on a regular basis. This will help maintain strong relationships throughout the pandemic. Effective use of social media platforms can provide customers and clients with timely and relevant updates and helps protect the reputation of your organisation and brand.
Consider a more detailed review of capital expenditure, both current and past. Identify items on which capital allowances may have been claimed in prior years, but which could qualify for a revenue deduction, or on which capital allowances were not claimed.
Consider, where relevant, various asset protection measures available to safeguard excess personal assets from the risk of the trading business. Groups with a presence overseas may consider a review of their business model and profitability forecasts.
Due to the likely impact on the current market value of many private businesses, now may be a good time to consider your succession planning. Review how effectively the management team is incentivised to drive future business growth. Explore the possibility of issuing shares to incentivise management and employees. It may also relieve pressures to offer cash based rewards.
Online demand and revenues have grown significantly since the outbreak of COVID-19. Review your digital position and gain an understanding of your staff and customers' needs and goals. Create a vision of your digital future with a clear strategy and roadmap with well-defined priorities. This digital strategy needs to connect your customers and clients with your online platforms.
Online growth will drive operational changes. These include range assortment, warehousing and distribution which all need to be planned for now.
Ensure your IT environment is secure and data insights are being maximised. Understand your existing capabilities, as well as business security needs, system architecture, external network environment. Develop a targeted, end-to-end digital solution that is secure and mitigates your risk.
With the shift to remote working, ensure the right controls are in place. Existing procedures and good practices need to be maintained to address working-from-home risks and new business norms.