COVID-19 has turned the business world on its head. China closed down most of its economy in late January, and the rest of the world followed suit a few weeks later. Now, as world leaders tentatively lift those lockdowns, we can take a look at how the Chinese have adapted their businesses, and apply it to our own to give us a shot at success in a whole new world.
Most countries have successfully flattened the curve and are waiting to find out what lies behind it. It’s too early to count the economic cost of the Coronavirus, but clues are starting to surface. British Airways recently announced 12,000 redundancies for its staff in response to a gloomy outlook for the aviation industry. Karaoke, a sacred tradition, is feared lost in China because social distancing will not permit it. The post-Corona world could be very different from the one we knew before.
Governments, economists, and business owners agree that things cannot go on like they have been for much longer; the engines of the global economy need to be fired up. A gradual transition into the new normal is obviously a scary one. But as the Western World wakes up from quarantine, we are at least fortunate enough to be able to look East to see how Chinese companies, large and small, have navigated the early stages of recovery.
Hygiene Above Everything
Hygiene is the priority. Employees and customers need clear guidance regarding specific safety policies regarding business. In the absence of a vaccination being available for the global population, social distancing is here to stay for the foreseeable. Business leaders need to implement strict measures to make sure their customers come back and their staff feel protected.
It is up to those leaders to follow their local and national guidelines when they can finally reopen again. This might also mean being more flexible than before, by taking sick leave requests seriously and allowing employees to work from home where possible. Large events should be cancelled or moved online. No risks should be taken; a second wave of the virus takes us back to square one.
Before Budweiser restarted their beer production line in China again, they implemented necessarily thorough hygiene measures. They opened a procurement programme to find protective gear such as masks, gloves, and hazmat suits for each one of their 26,000 employees, performed a huge deep clean of all of their breweries, and started an online hygiene training programme that needs to be completed before employees can start work again.
These measures should be an absolute minimum for any business.
Diversify to Meet Demand
Some industries have been brought to their knees by the Coronavirus outbreak and the travel industry has been hit harder than most. AirBnb made the news recently with a miserable outlook for its hosts, some of whom have dozens of mortgages and no income to pay them with. AirBnB’s problem in this case is that it is unable to diversify its income.
If not lucky enough to be an eCommerce giant like Amazon, whose owner Jeff Bezos’ fortune is reported to have increased by $24bn, companies need to open new revenue streams to fit around the virus. Business owners need to be creative, and this process could involve a lot of hit-and-miss before finding the right solution.
One out-there idea that is being floated by holiday companies in China is that of an e-holiday. Ctrip are offering their clients the chance to fly to their favourite holiday destinations from the comfort of their own sofa, have tours of famous landmarks, and even talk to locals about where they live. It’s pretty far-fetched, but some travel providers such as Kayak have already copied it.
It doesn’t sound as appealing as a real holiday, but it proves the lengths that companies need to go to in order to diversify their income.
The outbreak has been seen as a massive opportunity by some brands to reshape and implement their digital strategies. Where physical barriers are put up with new rules regarding social distancing, a window is opened to new, online opportunities. Most brick and mortar stores can, and should, become an online store with a few tweaks and a bit of computer wizardry. Employees can often be much more productive sitting behind computer screens as they are behind a cash desk.
Lin Qingxuan is a cosmetics brand based in China. In an industry hit hard by the outbreak, the company’s sales dropped by almost 90% over a typically busy new year period, and management decided to close almost half of its locations. Luckily, they also had a trick up their sleeve; hosting live-stream recommendation sessions for their products and transforming their business model into a strictly online one.
An army of store workers turned themselves into online influencers overnight. It was a huge success, over 60,000 people tuned in for their Valentine’s Day stream; they shifted 400,000 bottles of camellia oil in just a few hours. Sales from a two-hour shift by an online advisor has been equalling that of four in-store advisors. Lin Qingxuan found new horizons for their business by accident.
The digital marketplace is a huge frontier for businesses to conquer; now is a better time than ever to make that push.
The thing that struck me the most about the Coronavirus is that it has affected everything and everybody. We’ve all learnt to be a little bit kinder to each other, to look after our loved ones a little bit more, and especially to value the workers who were labelled as unskilled before. The supermarket workers, the shelf stackers, and the delivery drivers have been on the front line of tackling the virus.
Everybody around the world shares the same anxiety, loneliness, and boredom. SME business owners need to understand that to succeed, they need the community around them to be successful as well. As the lockdown eases, they should consider a community-first approach to their recovery, pitching in to the local effort, hiring local talent, and sourcing goods locally.
As everybody sits at home, scrolling through social media, Tsingtao, another brewer, has been taking full advantage. They launched a community marketing business programme in response to the virus, paying a pre-set commission to community members who shared adverts for their products on social media. It was a huge, simple success, and they hired 40,000 community marketers when they only set out to recruit 10,000. Those people, in turn, could keep their head above water, proving people power can be the driving force for recovery.
With community spirit in mind, business owners need to think first and foremost about their employees. They are the lifebreath of a company, and businesses owe their success to their hard work and dedication. Therefore, termination should be a last resort for their managers; there is an unwritten, ethical duty to protect employees.
Of course, that might not be possible in every situation. Some governments in developed countries have offered furlough loans for companies to pay their employees whilst they take leave. But for those who are not fortunate enough to have access to government relief, a creative, global cooperation is required to prevent an unemployment crisis. Daniel Zhang, CEO of Alibaba, has been at the forefront of this cooperation, developing new ways to keep people in their job.
He developed an idea called employee sharing. It is the practice of temporarily hiring employees, who may have lost their job elsewhere, to plug gaps in places where they are needed, such as warehouses, supermarkets, and delivery services. It’s a win-win situation for everybody, and businesses in the Western market can gain a lot from this type of widespread, local cooperation.
If anything, we have proven that human society can adapt and transform more or less overnight. Imagine what we can do across the whole recovery. It goes without question that the climate crisis has exacerbated the current, Coronavirus crisis. In turn, the climate crisis was a direct consequence of the short-sightedness of an economy built on fossil fuels, consumerism, and globalisation.
If we respond to future crises with the same old, tired economic models that got us there in first place, humankind can only blame itself for a miserly demise. The Coronavirus has been tragic, difficult, and painful. But the next period is an extraordinary opportunity for us to hit the reset button on how we do things. This is a real chance for real change and we’ve only got one shot at it.
Let’s take it.