Barbara Ruland / Friday, April 17, 2020 / Categories: Items of Interest, Business Resources, Remote Work Resources, Science & Practice Topics Seven tips to help your business survive the COVID-19 crisis Neil Morelli and Susan Chu “In the midst of chaos, there is also opportunity,” Sun Tzu, Art of War. For some of us, the world may seem like it’s spinning out of control and we’re spinning out of control with it. Many of us have never experienced a world changing event like the global COVID-19 pandemic, and hopefully, this will be a once in a lifetime moment. As entrepreneurs, we’re used to risk. We took risks to take an idea, craft and mold that idea, and build something that we think would be valuable to society. Our businesses grew out of creativity, passion, and drive. At our most optimistic moments, we believe that the same creativity, innovation, and drive will help us get through this crisis, while displaying our values and character along the way. We can’t control what’s happening right now in the world, but after reflecting on our own journeys, we remember that we should focus on what we can control. We see the current chaos as an opportunity to adapt our businesses, get back to fundamentals, and innovate. Here are several tips we can offer to other I-Os who are solopreneurs, small business leaders, startup founders, or team leaders dealing with the same dilemmas and decisions that come with the COVID-19 crisis: 1. Remind everyone that we will get through this if we're all in it together. Reach out to peers and fellow leaders to learn from them. Communicate with employees to get feedback and solutions to seemingly intractable problems. As leaders, it’s easy to feel isolated. Everyone is looking to you for answers, but you’re not in this alone. Fellow entrepreneurs, investors, partners, employees, and friends are eager to help if you ask. Also, remind everyone that solidarity can overcome a host of problems, and that sometimes there are no “good” options. As Jeff Bezos says, sometimes you have to "disagree and commit" to move forward with a decision even if it's not perfect for everyone. The point is that considered yet decisive action is more important than being paralyzed with over-analysis or fear. 2. Account for the "four walls.” To borrow an idea from personal finance guru, Dave Ramsey, going through a crisis usually means answering the question, “do I have enough money to support the four walls or essentials for survival: food, shelter, utilities, and transportation?" In business, that means answering the question: “do I have enough cash to pay for critical staff salaries or wages, essential services, rent or hardware to house the business, and the tools/systems that allow me to go-to-market and serve customers?” Negotiate all costs and expenses related to the four walls to preserve cash flow or funding reserves. Remember, you are not the only business who’s struggling. If you have loans/debts, see what you can do to get deferments. Re-negotiate your rent, talk to insurance brokers about adjusting premiums and reducing certain insurance coverages. Employees are often willing to do their part as long as executives and owners do theirs. If pay cuts have to happen, do so on a sliding scale with the highest paid taking a bigger percentage of cuts and reductions in benefits. Consider removing some perks that may not be necessary. Reach out to customers and ask if they could pay in advance (net 30 or 45 days). Ask yourself what you can adjust and where you can find compromises. Remember that cost cutting strategies or billing negotiations with customers can be creative and temporary. This is the time to be scrappy. 3. Come up with contingency plans. No one knows for sure when the health crisis will end or to what extent the economic crisis will negatively impact us. So, go through the "if this then that" exercise 4-5 times to map out what will happen if things go from bad to worse, level off, or quickly rebound. For example, review current contracts and run scenarios based on the percentages that reflect contacts not renewing, pausing, or cancelling. What are the impacts and ripple effects to costs and cash positions? How many contract cancellations and/or holds can you withstand before making changes to the business operations? If you have loans/debts, see what you can do regarding deferments and re-structuring of business lines of credit, if available. It’s better to have these contingencies mapped out before they happen. Although financial contingency plans might not be perfect, putting them to paper establishes some constraints on the ineffable and allows your creativity to work. Meanwhile, get input from others on each contingency’s realism and take stock of what's really important in your business. 4. Focus on customers, not just on sales. Everyone will be hard pressed to pay for a new product and service right now. Double down on building relationships, making connections, sharing your knowledge, and even offering up temporary free trials or services to customers. It’s normal to want to prioritize new sales and close deals, but for most of us, that won’t be possible for at least a few more weeks. However, the old advice that it’s easier (and more profitable) to keep a customer than to get a new customer has never been truer. Consider how you can overdeliver and overserve your customers and clients. They are probably reeling due to the sudden changes as well and your extra service and concern (if authentic) won’t soon be forgotten. 5. Consider creating new job descriptions and developing employees. What jobs/roles/tasks could be adapted to stay productive and overserving current customers (tip #4)? Research shows that it's not always the leader with "all of the answers" that succeeds, it's often the most adaptable. How can you “MacGyver” job descriptions to keep folks on your team productive and serving customers even if it's not their normal job duties? Start cross-training staff to develop key skills, and to minimize business disruption should you have to let people go. This is also a good time to encourage employees with more discretionary time to focus on personal and professional development, at a very low or no cost to the company. There are tons of free webinars and training sessions that are being offered by all kinds of organizations. Encourage virtual lunch sessions for employees to share their what they learn with others, even if it’s the best way to make bread! 6. Innovate where your clients have the highest need. Apply design thinking (rose, buds, thorns exercise) and ask what can be done differently to empathize with your customers’ needs. Everyone is feeling the pain right now, but your customers or clients are feeling it in unique ways. Serving them at their “point of need” is the best way to keep them as a client and identify new opportunities for innovation. What are other opportunities to serve clients in a new way that’s adjacent to your core competencies? How can you repurpose content, intellectual property, or services to reach an underserved or new market? Think about GM making ventilators, Gap making face masks, etc. -- there are often opportunities (and a chance to make a difference) if you're creative. My (Susan) own example is that our platform, CultureCrush, was focused on the B2B market. Given the current market conditions, we’ve adjusted our focus to a B2C market. We’re doing a few test pilots to get initial reactions to see what additional adjustments we need to make. Right now, we are not making this a revenue opportunity, since there are millions of Americans who are laid off and could use some hope that they will find another job at a company that fits their values. 7. Give where you can. It may seem counterintuitive during a crisis, but we believe that the businesses who survive this crisis will be the biggest givers. For example, Walmart is giving all employees a raise and paying out bonuses early. Some restaurants are starting relief funds for their employees. The Four Seasons hotel chain is offering their hotel to healthcare workers in New York City. Obviously, these companies have the means to give, but the point is that businesses will get noticed for adding more value than what is expected and giving time, resources, or support before being asked. It’s important for all of us as individuals to give, but companies can have an outsized impact when they give back. They also get good brand awareness, new users, and positive word of mouth from giving. Not only is this the right thing to do in a crisis where everyone needs to step up to protect and serve their neighbors, it also creates more opportunities for others to reciprocate and positions your business well when the crisis ends. Conclusion We are in a temporary state. How we navigate through this crisis will speak volumes about our leadership, our credibility, integrity, and our organizational culture post-pandemic. Connect with your employees and get to know them personally. It goes without saying that they are also going through a very tough time and are worried about their “four walls.“ We’re all weathering a difficult storm together. It’s a storm that we weren’t totally prepared for due to both its suddenness and its scope. But this storm will pass. So, we ask, in a year from now, how do you want to be remembered? How do you want your company, team, and brand’s reaction to the pandemic of 2020 to be recalled by your employees, customers, and partners? Thinking longer term helps us to see the bigger picture, consider the needs of others, and invest our time and energy into the things that really matter. About the Authors Neil Morelli, Ph.D., is the VP of Product and Assessment Science at Berke, a pre-hire assessment technology company that helps businesses make more confident hiring decisions at scale. He specializes in talent acquisition, data science, and product development. Neil received his Ph.D. in I-O Psychology from the University of Georgia and his M.S. in I-O Psychology from the University of Tennessee at Chattanooga. He can be reached at email@example.com. Susan Chu is the Founder of Culture Crush, an online organizational culture assessment platform that provides leadership development and team alignment, hires the best fit candidate, drives organizational change, and improves workplace culture. She is an avid supporter of entrepreneur and non-profit communities, and serves on the Board for Goodwill of Delaware. Susan holds a M.S. in Organization Development from Johns Hopkins University. She can be reached at firstname.lastname@example.org. From the Learning Resources for Practitioners (LRP) Committee: Do you have expertise to share to help practitioners and the larger business community adapt during COVID-19 crisis? Feel free to contact Kimberly Adams, LRP Committee Chair, at email@example.com to discuss your idea and submission details. Thanks! Find more resources for adapting to work in the age of COVID-19 on SIOP’s new Remote Work page. Find resources and advice on topics including work-life balance, worker well-being, managing remote teams, employee motivation and engagement, and organizational agility. New resources are being added on a regular basis. 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