Call that a crisis? – THIS is a crisis

Gosh, after the seemingly never ending list of “crisis” or “emergencies” we actually have one to deal with. The spread of Corona virus is alarming and people dying is of course distressing. However, the worst part of this pandemic is man made and quite a doozy.

This article is not “click-bait” to make sections of our society hyperventilate, in fact it’s the opposite. Yes, the virus has health implications, but the fallout by economies falling on their knee’s is going to cause a much greater amount of suffering. The media needs to take a bit of a break and start reporting, instead of trying to pitch politically skewed opinions and snide remarks from the sidelines. Telling people for instance that RBT’s and random drug testing has been cancelled is simply reckless. Hysterical reporting has whipped up fear (seriously, just look at panic buying in supermarkets of toilet paper – scenes that would fit right into a Monty Python script). Most people are level headed and exercising hygiene and other personal precautions as recommended. However most people’s main concern is to do whatever they can to keep their jobs or businesses turning over through the crisis and into the future. If income dries up, it becomes very hard to meet financial commitments including loans or indeed putting food on the table. That’s far more serious than a day or so without dunny paper.

We can’t expect Governments to have all the solutions. And what we are about to see will make the GFC look like a blip. During that time, Australia was carried through by China that was growing at 6-8%. We unloaded all our surpluses back then, and the reserve bank has unnecessarily had interest rates at emergency levels for years. Now, we have very limited fire power left (interests rates near zero have in fact been a hand brake on the economy), and this time we are seeing demand (China has slowed) combined with supply issues (can’t get people or products around the world to have something to sell).

There are always opportunities in situations like this. From a business perspective, prudent management practices have never been more important.

Review WHO you need – good people are hard to come by. Utilise their skills and ideas to jump on all opportunities during the slowdown. It is a good time for “housekeeping” too, address all those issues that will help you be more productive when the market does turn. Good people and businesses look after each other as much as they can.

Review WHAT you need – our November Newsletter “When the going gets tough…” went into this in some detail. Focus on your profitable functions and consider diversifying into areas where there might be opportunities (for instance competitors going under). Digressing for a moment, there’s a huge opportunity in providing delivery services to consumer doors, but instead of expanding this section of their businesses, a lot of established companies seem to have put up the “too hard” signs by placing self-imposed obstacles on how they can’t help their customers. Opportunity knocks only once on some customer doors…

Cash is King – watch your debtors and watch your expenses by avoiding all non-essential costs. However, much like the economy needs to keep money turning over, you also need to spend money on things that will help your business now and in the future. There will be good buying opportunities, and probably sooner rather than later. Most products in Australia are imported, and the exchange rate has tanked (the exchange rate effect alone is about 15% so far) – meaning that what you can buy things for NOW will be less than they will be even in a few months time (assuming supply chains are back up and running so you can get them at all).

Review Processes and set up contingencies – never has there been a better time to consider WHY your business does certain things and the value they add. Consider using technology to your advantage. We may now be forced to give “work from home” a real crack. I think the novelty will wear off for many when they realise the social isolation, and likewise many will struggle with achieving productive outcomes – working from home will highlight productivity issues as rather than seeing the hours being put in as a measure, it will start to show what people actually put into their hours. It’ll test Management also to keep people focussed on tasks by giving well-structured goals.

Some of the above will quite possibly lead to societal changes. A lot of corporate type activity has involved travel to meetings, but with travel bans and the like, we’re likely to see a change towards video and phone conferencing. The technology has been there for years, but perhaps not the drive to explore the full potential and realise the savings in terms of time and money.

The other lasting legacy will hopefully be how crisis contingency management might get rid of some of the bull shit in workplaces. I recall during the 2011 flood clean up how well society pulled together and achieved truly great things in a short space of time. Not every rule was necessarily followed, but nobody got hurt, and maybe we should have called some mandated rules and processes out for the baloney they were.

We’re still seeing repeats of some ingrained systemic faults. Look at for instance how sick absences are handled. We know of a person who went into 14 day self isolation due to arriving from overseas. At the end of period, he went to a Doctor for a clearance certificate to return to work. The Doctor confirmed that he didn’t have any Corona Virus symptoms, however couldn’t sign off on him because of the legal risk if he got it wrong. He therefore had to go and wait in a waiting area with 150 other people for testing, and there is probably a higher chance that he could catch the virus there than if he’d gone back to work on the Doctor’s professional opinion. This highlights not only the need to review health processes (unnecessary visits at great cost, with limited resources not being allocated where they are really needed), but also that we need to remove litigious aspects that are making our society worse.

Good employees and employers work together to achieve a good outcome for all parties. But there are some people who expect “someone else” to do everything for them. When an employer suggested to a particular employee that they may have to work from home, the employee’s response was “what happens if I trip on something on the floor? And my cords haven’t been tested and tagged, so aren’t safe”. Funny how these things aren’t an issue for the person on days off. “Do I get compensation for having to use my home as an office” – but in return not considering the time and money saved by not having to commute to work, or that the person will most likely be less productive for the business and should be grateful that the employer is trying to keep the employed at all. We need to adjust the thinking that employers are some kind of bottomless pit that can solve all of society’s problems.

Whilst all employers I know want to keep their employees safe, hopefully this whole crisis will lead to some positive outcomes, like a much-needed re-calibration of personal responsibilities, and a focus back to achieving good outcomes (rather than box ticking and virtue signalling).

As always, onwards and upwards!

Fred Carlsson

General Manager



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