Use Forecasts and Experts Carefully
Current events are unfolding at an astonishing rate. It seems every hour, there is another restriction or quarantine put in place. As a leader you must be aware of current events.
We urge you to exercise caution when reading forecasts and listening to experts, as each outlet, writer, and institution will have a different outlook on how things will play out. Critical thinking and deductive reasoning are two skills we exercise every day at MOST. It’s important to use both when pulling information from forecasts and experts, because that data and knowledge will have an impact on the business decisions you make.
Address Each Situation Differently
The Coronavirus affects each area of your business in a different way. Therefore, each situation should be treated independently.
Five key areas you should look at first are:
- Customer Retention
For medium to large size companies, set aside a task force to tackle each of the above areas. Each area needs to be handled with care and dedication. A dedicated team to tackle each project is the best way to ensure each area is receiving the required attention.
For smaller companies, split the work amongst partners and/or key employees. The state of each area will change on a daily basis, so it’s important that you are proactive, not reactive.
Continue to Learn and Update Your Knowledge of COVID-19
In order to make good decisions, it’s important to be knowledgeable about a topic. There is an unlimited amount of news available surrounding the Coronavirus, and you should immerse yourself in it.
News surrounding economic forecasts and business restrictions are changing daily. If you are to steer your company in the right direction, it is imperative that you are aware of the changing macroeconomic landscape.
Understanding how the last two months have unfolded around the world, you should have an understanding of how the next few months to a year are going to play out. Use the knowledge that you have now, continue to build upon that, and plan for what’s to come. Be resilient!
Understand the Needs of Your Employees and Customers
Your employees and customers are your business. Without them your business would not exist.
These are difficult times for you, and are equally difficult times for your employees. There is a tremendous amount of uncertainty in the economy and companies are laying off employees at increasing rates. Now more than ever, it is important that you understand how your employees are feeling, and how that could potentially be affecting their work. It’s best to display your leadership abilities and address these issues head on to avoid any serious repercussions.
In this instance, we reference Maslow’s Hierarchy of Needs. Are you meeting the physiological and safety needs of your employees? For someone to feel comfortable, productive, and to excel, these base level needs must be met. If you are able, work with your employees to develop alternative pay schedules, or pay them for hours lost because of forced closures of business or lost revenues.
Your customers' needs will continue to change every day as the economy changes. Your customers are the lifeline of your business, so it is important that you meet their needs no matter how small or large. They may begin to demand more, or less, but it is important to be there for them when they need you. Continue to provide the best products and services as you always have, and when the market stabilizes, you’ll be well positioned.
Develop Creative Solutions
The ability to think creatively is one of the most important aspects of being a good leader. It’s something that I’m sure you all exercise on a daily basis. With markets closing, quarantines being put into effect, and the global supply chain shrinking, it’s extremely important to develop creative solutions to keep your business moving forward.
Five areas where you should be developing creative solutions are:
- Cash Flow
Having proper plans in place, and thinking creatively to stretch dollars and generate revenue, should be of utmost important at the moment.
Be Nimble and Flexible
For most smaller companies, this is something that you exercise on a daily basis. The ability to quickly move through tasks, and be flexible with decision making and the hierarchy that can accompany it, helps smaller companies grow faster. Continue to be nimble and flexible and don’t dwell on sunk costs.
For larger companies with a structured decision making hierarchy, this can prove to be quite difficult. We recommend relaxing on certain aspects of decision making criteria, and appointing decision makers to make decisions more quickly in the various aspects of your business. It’s important to be nimble and flexible as current events are unfolding at an astonishing rate. By avoiding bottlenecks in the decision making process, you position your company to adapt to current events as they unfold.
Prepare Now for the Next Crisis
The biggest takeaway from the events that are currently unfolding, is the importance of planning for such events in the future. Many are predicting quarantines and business closures until May of 2020, with a second wave of the Coronavirus in the fall of 2020. It’s important to not only plan for the Coronavirus and it’s impacts on the cannabis industry in 2020, but for future crises as well.
In many cases, there are types of insurance to cover losses ie: cyber crimes, terrorism, etc. This is not the case for the Coronavirus, unless you have pandemic insurance, but we recommend looking into insurances to cover future losses due to other circumstances.
Prepare now for the next crisis by developing a system to save a cash reserve. A cash reserve could make all the difference in helping your business survive. Putting aside a small percentage of monthly revenue to help in a downturn will prove to be extremely beneficial.
There are many other risk mitigation tools that you can put in place to limit the negative side effects of catastrophes and major losses. It’s always best to prepare for the worst.