Published April 14, 2020
The COVID-19 global pandemic has hit communities, businesses, our country, and the world like a hurricane. However, because some founded optimism appears to be in sight, companies must start positioning themselves for the gradual reopening of the US and global economies.
There are still many uncertainties, but, as the contours of the crisis become clearer, we believe there are four key areas that must be considered—an evaluation of markets served, the creation of flexible working plans, an analysis of talent needs, and the creation of effective company culture.
Evaluate the Markets You Serve
Although the net economic effect of the COVID-19 pandemic is projected to be significant, there are opportunities amid the chaos, just as in any crisis. Some of the hardest hit industries are obvious—travel, hospitality, oil and gas, professional sports, and nonfood brick-and-mortar retailers, to name a few. Likewise, there are obvious areas of growth amid the crisis—large portions of the healthcare industry, food retail, delivery services, and technologies that facilitate connectedness are a few examples.
There are also winners and losers that, while possibly not top of mind, are easy to spot. For example, commercial toilet paper is stockpiled in warehouses while the industry cannot manufacture retail toilet paper fast enough. Although some food products and produce destined for foodservice and commercial markets are going to waste, rolling shortages of products we take for granted are occurring in supermarkets across the country. Whereas the average citizen does not understand the nuances of the product and supply chain differences between retail and commercial markets, the respective industries certainly do, and they will hopefully adjust successfully to address new market conditions.
However, the real opportunities likely lie in thinking about how our personal and professional lives as well as how the global economy will change as quarantines lift. It is unrealistic to think that life will simply spring back to normal on a magical date any time soon. We must be prepared for life to be significantly altered for a considerable span of time and perhaps, in some ways, permanently. For example, although fall and winter cruises or European tours are unlikely to be in high demand (and perhaps not permitted), what about home entertainment systems, home décor, and remodeling products and services for our lives closer to home?
Many new luxury home, stadium, and office building construction projects will be put on hold, but how about construction products that allow for added domestic manufacturing capacity, given the disruption in the global supply chain? Or maybe construction will be needed to facilitate acceptable social distancing in workplaces. Maybe there will be interest in adding additions to existing homes if Americans are hesitant to buy new homes.
Those experienced with reshoring, cybersecurity experts, automation engineers, robotics professionals, and software engineers are all likely to be in high demand. If your company is heavily invested in markets that stand to lose a lot for the foreseeable future, how might you be able to shift your organization to succeed among the newly created opportunities?
Create Flexible Working Plans
Your organization will need to develop working plans to navigate the unknown waters ahead. Given that the state of the crisis and the immediate future are not clear, your plans will need to be flexible and contain contingencies. This does not mean having no plans or plans that change hourly. However, while we are still defining the parameters of the crisis and understanding the longer-term consequences, your leadership team likely will want to meet at least weekly.
Broadly, you will need two working plans. The first plan must be an operational plan that will guide your business to your new normal. The second plan must be a business plan that will steer your organization as you work toward your future prosperity.
To guide your operations to your new normal, your employees will need to feel as though you are taking the proper measures to protect their safety. As an example from our recent past, it took time for workers to feel comfortable returning to high-density office buildings post-9/11, even after local governments gave the all-clear. It was not until new security protocols were firmly established that workers felt comfortable reentering large buildings.
In the case of COVID-19, workers will feel much more comfortable when the following procedures are in place:
- Availability of ongoing testing, including temperature testing
- Availability of face masks or face shields
- Proper social distancing made possible
- Management of symptomatic employees, including the requirement for return-to-work clearances
- Ongoing and thorough disinfecting strategies in the workplace
Your business planning process will need to include the following:
- An ongoing analysis of the current and likely future health of the market segments you serve
- Strategies for reducing your company’s reliance on highly impacted industry segments unlikely to return to normal operations in the foreseeable future
- Creative strategies for pursuing growth markets
- A thorough analysis of vulnerabilities within your supply chain and needed action plans
- Communications plans for sharing visions with all stakeholders—employees, customers, shareholders, and your community
- Preparedness planning to determine the steps and resources needed to execute business plans
The first reflex in times of crisis is to implement hiring freezes and consider workforce reductions. Workforce reductions will, unfortunately, be the reality for many companies. However, consider cuts carefully and resist implementing hard and fast hiring freezes.
Utilize insights from your business planning process to determine the talent you are going to need to execute your plans. The engineering and IT labor market was incredibly tight before this crisis. While some engineering and IT professionals are bound to be laid off, many of the most-needed professionals will likely be even more challenging to recruit than they were pre-crisis.
While none of us know what will transpire within the upcoming months, we have been confronted with how vulnerable the US is due to our highly outsourced supply chain; odds are good that reshoring will accelerate. However, manufacturing that returns to the US will not be labor-intensive processes. Instead, processes will rely heavily on automation, robotics, and the Industrial Internet of Things (IIoT).
Automation engineers, robotics experts, electrical engineers with IIoT experience, software engineers, project managers, systems engineers, and other professionals needed for a restructuring supply chain will be in very high demand. You will very likely need help recruiting this specialized and in-demand talent.
Depending on the needs outlined within your business and contingency plans, utilization of contract workers might be another avenue worthy of consideration.
Effective Company Culture
Maintaining a successful and productive company culture will be more important than ever. Crisis can bond your organization as a unified team, or crisis can push people apart creating an “everyone for themselves” environment.
A strong culture, backed up by stable, empathetic leadership, is part of what’s necessary to ensure that the company remains on solid ground. Leaders must be honest and transparent with their workforce. Additionally, leaders must prioritize inclusion because companies are much more likely to be innovative under pressure if they seek input from a diverse group of employees. Also, to refine and strengthen contingency plans, leaders must understand every aspect of your organization and the resources that are needed.
None of these areas will be easy, and your company’s leadership team must be prepared to change course as needed. However, we feel that attentiveness to these four considerations will go a long way toward allowing your company to achieve long term prosperity. Let us know if 180 Engineering can help.