April 20, 2020 5 min read Opinions expressed by Entrepreneur contributors are their own. Crisis preparedness is a competitive advantage, and what does
April 20, 2020 5 min read
Opinions expressed by Entrepreneur contributors are their own.
Crisis preparedness is a competitive advantage, and what doesn’t kill your business should make it stronger. In March, more than 10 million Americans filed for unemployment as workers stayed home due to statewide lockdowns.
The health emergency isn’t over, but businesses can (and should) find ways to make their operations stronger when the crisis finally ends. That requires founders, CEOs and employees to become leaders in their respective organizations and communities during a difficult time.
To ensure that happens, the following are essential leadership traits to possess during a crisis.
1. The company’s mission must endure.
Strategy and processes may change, but a company’s mission should remain constant. A mission statement is the guiding principle that reminds management and employees why they are in business in the first place.
According to a 2019 Glassdoor survey, 56 percent of respondents said company culture is more important than salary when it comes to job satisfaction, and 73 percent would not apply for a job unless a company’s values align with theirs.
Most companies were originally founded to help customers by tapping into unique corporate strengths and competitive advantages. There are typically no corporate mandates or charters that force an entity to manufacture the same products indefinitely.
Therefore, during a quarantine, an organization can still fulfill its mission by serving consumers or stakeholders in a different way. For example, automakers like General Motors and Tesla are mass-producing ventilators, while other manufacturers are pivoting towards creating face masks, hand sanitizer and other key medical supplies.
In the case of Global Healing Center, the Houston, Texas-based health-supplements firm joined several organizations in donating raw materials to a local distillery, which is working 24/7 to produce more than 100,000 gallons of hand sanitizer. The sanitizers will go to hospitals and individuals in the local community who are fighting COVID-19. The founder, Dr. Edward F. Group, also decided that his company would donate $50,000 to Meals on Wheels.
These actions exemplify a company fulfilling its mission in other ways: by helping to produce critical supplies. “At Global Healing, we are fortunate to make our own products,” said Dr. Group during a recent email exchange. “We were able to adjust our manufacturing schedule to prioritize the immune-support products in high demand, so we can help people through this time when they need us most.”
2. Determination brings immediate (and long-term) benefits.
Passion is the fire and determination is the fuel. The coronavirus outbreak is a major challenge. Businesses are losing customers, furloughing employees and temporarily closing in order to save cash and stave off bankruptcy.
However, a health crisis merely represents one obstacle (albeit a major one) out of many hurdles that a successful business must overcome throughout its lifetime. The top three corporate crises are financial/liquidity (23 percent), technology failure (23 percent) and operations failure (20 percent), according to a 2019 PwC survey.
With determination and smart planning, a crisis need not be fatal. Rather, it should improve a company and its people. The same PwC survey found that 42 percent of companies were in “a better place” post-crisis, while 19 percent were worse off.
A crisis forces managers and employees to be creative, to cut unnecessary costs and to focus on recovering key customers and gaining new ones, too. The result should be a leaner and meaner organization poised to outcompete rivals after an emergency has passed.
3. Leaders need to be open-minded during a crisis.
The business and economic environment will change significantly after the coronavirus pandemic, which as triggered what will likely be the worst economic crisis since the Great Depression. That’s why it’s essential for leaders to keep an open mind and seek innovative solutions in an unprecedented business climate. An open mind is the willingness to accept different facts and opinions in order to become more effective. It gives a founder or CEO the ability to deal with emerging business circumstances such as a change in consumer spending or supplier network.
Optimization is rarely a stationary target. The post-crisis reality will likely require updated corporate strategies, processes and business partners for a company to stay competitive as the global supply chain reorients itself to become less dependent on China.
There’s a roadmap to emerge victorious; it’s the leader’s job to seek out such a game plan.
The coronavirus pandemic caught Americans by surprise and has taken a huge toll on businesses. Nearly 90 years ago, the Great Depression did the same after the Roaring ’20s gave many the illusion that good times would last forever. They don’t. Each generation faces a crisis. It tests people and companies and forces us to adapt, improve and usher in a new era of prosperity.
This article is from Entrepreneur.com