Most of us would agree that restarting the global economy after we get through the coronavirus crisis is imperative. We want to get back to work. The challenge for individual businesses is that we will be restarting an economy that is fundamentally changed. Before we restart the economy, we need to rethink our businesses.
Now is the time to make a strategic assessment of your business: finances, products, customers, organization, sales, partners, branding, suppliers, and employees. You may find that you need to make changes to your business to be ready for the post-crisis economy.
Restructure. What if the post-crisis economy is so radically different that your business cannot recover? On the revenue side, will social distancing severely reduce the number of customers you can serve? Are your products still relevant in light of travel restrictions and work from home? Financially, do you have enough cash to cover your expenses until business picks up, or make the interest payments on your debt? Can you still raise capital to fund your growth? In this case, your business probably can’t restart, and a reorganization is not enough. It’s time to bring in advisors to help you plan for restructuring your business. Financial advisors can help you revamp the balance sheet, negotiate with lenders about reducing debt burdens, and identify potential asset sales. Legal advisors can help you prepare for and decide on whether to file for bankruptcy protection. Recently, we’ve seen a number of established retailers begin to restructure their businesses to survive this crisis and be viable post-crisis.
Rehabilitate. What if you find that there is still demand your products and you have good customer relationships, but the fundamentals of your go-to-market model have changed? Are you a wholesaler that depends on tradeshows to move your product? Does your sales team use face-to-face meetings and customer entertainment to build relationships and close deals? Is an on-site experience central to the delivery and consumption of your product? In this case, set up a structure to empower your employees to identify and make the adjustments that will rehabilitate your business. Don’t make one big bet. Make lots of small bets and consider the timing of the bets. Continually review what’s working and what’s not. It’s all about learning. Many restaurants are finding themselves in this category. They are trying curbside delivery, catering, premium member clubs, and online classes and tastings. Overall, these restaurant owners are learning how they can rehabilitate their businesses when they can’t fill their buildings with customers.
Rebuild. For many of us, the coronavirus crisis is the biggest business challenge we have ever faced. During a crisis of this magnitude, human nature is to focus on survival. Are my employees safe? Are my suppliers solvent? Can I make payroll? While survival is paramount in a crisis, we can’t lose sight of innovation and growth. Are there new products, releases, or extensions that could create new revenue streams? This is the time to be talking with and, more importantly, listening to your customers. Are there features you could add to your current products that would increase demand? What additional products and services would they consider buying from you? How is their business changing and where could you deliver value? High-tech companies with sustained success are great examples of this strategy of rebuilding through continuous innovation. Many of these tech companies are already developing new products or enhancing current products to serve their customers during and after the crisis. For example, we are seeing this innovation in video conferencing and health information tools.
A few businesses are doing great during this coronavirus crisis – they were in the right place at the right time with the right product. But for most of us, this crisis will test us, challenge us, change us, and ultimately strengthen us in ways we had not imagined. As we prepare to restart our economy, it’s time to rethink our businesses and take the necessary steps so that we are better than we were before the crisis.
There is no “business as usual” in this new economy.