Very few SMEs have had any experience with a global pandemic before COVID-19. During the best of times the business environment is unpredictable, but entrepreneurs have learned to manage and adjust to its “normal” variations.
COVID-19, however, has exposed critical cracks in the foundation of many businesses of all sizes.
Most of these cracks may never have become apparent in a normal business environment, but the COVID-19 stress test exposed them. So what now?
Even as COVID-19 cases begin to decline, governments will work on avoiding new outbreaks, resulting in containment measures to likely persist in some form.
Prepare and prepare some more
Therefore, it is important to accept that it’s almost impossible to predict how long the uncertainty will last, and things will most likely not go back to what they used to be. The severity of disruptions to businesses, consumers, and governments will make people rethink the way they do business.
In fact, some suggest that this won’t be the only pandemic in our lifetime. This is not a reason to panic. The point is that in the face of the unknown, all we can do is prepare.
What can you do to prepare? Not just to get through the current COVID-19 pandemic, but come out better and stronger than ever?
Build up your capabilities to get through the pandemic and beyond
Here are three things you should seriously consider:
1. Embrace Digital
From now on, more than ever, adopt digital technologies to transform your business model and operations. This can include creating digital products and services, the use of online platforms to gain efficiencies and create customer value.
Digital technologies reduce information search costs, facilitate exchanges, and provide businesses with new marketing, finance, and networking opportunities. Additionally, post COVID-19 we’ll see more remote work.
Many SMEs rely heavily on manual, paper-based processes. These processes will break when people are not in the same physical space, nor do they scale which also limits the company’s growth potential.
Remote access: As remote work continues, companies need to ensure their infrastructure and systems are set up to enable this in a secure way for employees, customers and partners.
Know your customer. Centralize all information related to your customers and use it to your company’s advantage.
Go online: Companies of any size, including smaller firms, can easily access regional, national, and global markets in a cost-effective way using e-commerce platforms, both for buying and selling products. This holds true for retailers as well as manufacturers, which are increasingly are moving to direct-to-consumer business models.
2. Diversify products ad supply chains
A very common scenario, especially for SMEs, is being focused on a single product, service or market. This is like a one-legged stool, and it puts a lot of pressure on any business. You should explore what adjacent markets (type of customers or geographies) exist that you could pursue as well as what other products or services your existing customers may need.
You must also ensure resiliency in your supply chain. For decades, we’ve been sourcing from, and outsourcing to, more cost effective and remote countries. Some of the recent lessons learned include the advantages of a more regional element in the supply chain for business continuity purposes.
3. Be agile
In the short term, adjust your operations where possible to meet the urgent and critical needs created by the current crisis. There are many examples of companies that have done this already—distilleries and cosmetic companies are making hand sanitizers, car manufacturers are making ventilators and respirators, and specialized clothing companies are making medical masks, scrubs and gowns. For example, just two weeks after a government call to produce medical equipment, more than 3,000 companies responded.
What can you do with your expertise?
Good questions to ask oneself in this context start are: How could we use our expertise? or What can we do to help our customers with a specific problem or challenge?
These are critical steps companies must start taking today to build capabilities, not just to get through the COVID-19 pandemic, but to restart activities stronger and sooner than later, and stronger than ever.