The Coronavirus has sent the world into a spin. Something that felt a distant problem to many just a few weeks ago has become a very real threat and the reason why you’re most probably stuck home now. It’s first and foremost a sanitary crisis.
What is clear now is that it’s also about to become a pretty tough economic slap in the face of many.
Running and leading a business is hard enough anyway, without the impending social and economical implications of a pandemic that, let’s face it, few people really understand.
How do you lead your startup through such a crisis? With employees raising health concerns, asking questions about the future, or being directly affected by the virus (either themselves or their family), what should you do first?
So we wanted to offer a little bit of help and advice about what you can do to help your business during this period of uncertainty and crisis.
Here are five very actionable recommendations to work on in the next few weeks.
At Stun and Awe, we don’t believe that maximizing value for shareholders is the main purpose of a company. That’s just a dumb statement, especially in today’s world.
If you’re a decent human being, your people should come first. Period.
You shouldn't have to rationalize this. There’s a potential threat to their health, their lives, and that of others.
As a leader, your very first job is to protect your people. You’re the captain of the ship my friend. That means taking initiatives, following your government’s directives, and sending your employees home if it’s not already done.
Some people will say that showing to your employees that you care will help you build loyalty, engagement, and commitment among them. Maybe, but that shouldn’t be the reason to do so.
Looking after your staff is just the right thing to do.
There are times for being a democratic business leader, and there are times for moving fast. Today, the latter is a lot more appropriate.
If you have a relatively large management team (more than 8) or are used to include a lot of stakeholders when making decisions, you’ll need to change.
What we suggest is to put in place a crisis management committee of no more than 3-5 management team members. Its purpose: expedite decision-making and communication.
Meet them virtually on a daily basis to review people’s safety, organizational issues related to remote work, and key messages to communicate both internally and externally.
If you’re a tech company, working remotely shouldn’t be such a novelty or an obstacle. Still, you’ll bump into a variety of VPN, Slack confusion, hardware, and people issues that will need to be resolved rapidly.
Ultimately, you need to show to your employees that they can count on their leader. That means reassuring them, communicating constantly, showing decisiveness, and providing clear guidance.
The Coronavirus is a sneaking one. It’s basically attacking your business on three fronts: staff, operations, customers. We’ve covered off the first two, but your customers are also under pressure.
If one of them cancels a subscription/order, it’s not the time to call in the lawyers to tell them they breached the contract or terms and conditions. On the contrary, this is the time to show your compassion and that you’re there for the long run.
First, make sure that you send them an email/newsletter to tell them what you are doing to respond to the crisis and how you will be working and supporting them.
Second, come up with a few ways to help them go through the crisis. Think of discounts, more flexible cancellation terms, or allowing them to skip payments for a short period of time if you can afford it. Ultimately, you want to be compassionate while aiming to keep them as customers when things calm down.
For instance, Berlin-based travel startup GetYourGuide allows their customers to get a full refund if they cancel 24 hours in advance, no questions asked. The Project Management software company Basecamp is offering to compensate accounts for first responders, public health officials, and groups along the PPE supply chain for first responders during the duration of the effort.
Unless you sell toilet paper or hand sanitizer, your business will most likely get hit by the crisis. As the CEO or leader of a startup, your job is to rapidly assess the impact the coronavirus will have on your business.
Use our Decision Making Grader to see how strong you are at making decisions
It’s easy to get overwhelmed. You could face staffing or payroll concerns, customer payment or foreseeing supply chain issues. You’re going to need to plan exactly what measures are going to take place for an array of eventualities.
If done right, this planning will save valuable days and resources in the coming months and help protect your business during the coronavirus crisis. But to do this, you have to become a master problem solver and experimenter.
An easy way to do this is to start by taking a high-level view of your business. Develop a few scenarios to understand what a 20%, 35%, or 50% revenue drop would mean for your profitability and cash flow.
You’ll probably have to throw your hiring plan or roadmap down the trash can and have to come up with alternative plans. That’s fine. That’s life. As Ray Dalio explained in his book Principles: Life and Work, you need to “embrace reality and deal with it.”
Once you get the results of your high-level scenario analysis, start jotting down a few options. You can cut discretionary expenses or offer part-time or sabbatical to employees who have already expressed their desire to do so. You can drop software licenses or subscriptions or apply for government financial support depending on what your government has announced so far.
The thing is, you do have options. Everybody has been caught off guard by the pandemic. Now is the time to get back into a proactive mode.
The world of business is going to change, that much is true. But things will change at different rates and have different consequences for different businesses.
Instead of getting into a negative, this-is-the-end-of-the-world-omg-mom-help-me type of mindset, start actively looking for business opportunities. Not in the non-ethical sense of the term. Please don’t be like this Amazon seller who stockpiled 17,700 bottles of hand sanitizer and is now under investigation.
Crises bring changes, and changes bring opportunities. Sit down with your management team and start identifying upsides to this crisis. This could be shifting your sales mix, targeting a new type of customer segment, or improving your operations. With many currently operating in full remote mode, companies’ operations will be radically transformed over the course of the next few months.
Opportunities also exist beyond your employees and company. At the moment, people are really in need. There are plenty of movements happening for all kinds of workers.
On LinkedIn, for example, the group Creative Industry [COVID-19] Support is a group started for freelancers and members of the creative sector who have lost work on the back of the virus. This was started by one man, Andrew Dobbie, and has now led to 2,000+ people joining, with extra benefits such as advice seminars and mental health briefings.
You’re told this from a young age, but in times of crisis, being a great leader means being positive, but also honest. People are not stupid, and they’ll know exactly what is going on even before it is announced.
The worst thing to happen in your businesses would be for word of any drastic changes to leak out before they’ve been announced. This breaks trust, and breaks spirit. Times are going to be tough, so having the ability to be mature enough with your team may just save time, money, and the company.
These are truly unprecedented times. Most businesses won’t have planned for this scale of disruption, but that doesn’t mean these waters need to be more choppy than they have to be.
Take care of your people first. Then start planning your come back.
And if you haven't done so already, join our newsletter to get tips and tools that can speed up your progress.