This archive report was first published on 20 July 2020.
Surviving and Thriving in the New Normal ¶
July 20, 2020
As the Covid-19 pandemic continues to disrupt businesses and economies, companies must adapt and innovate to survive and thrive in the new normal. According to James Mworia, chief executive of a listed company, the key to success lies in protecting employees, reassuring customers, and preserving profit margins.
First and foremost, businesses must prioritize the safety and wellbeing of their employees. This means allowing staff to work from home, observing government guidelines, and taking measures to safeguard their safety and productivity.
Next, companies must assure customers of their safety by innovating alternative delivery channels that minimize physical contact. This could mean rolling out digital learning channels, as Longhorn has done, or finding new ways to meet customer expectations.
Preserving profit margins and securing working capital are also crucial in the new normal. Businesses must cut waste, examine cost structures, and weigh equity-debt ratios on their balance sheets. A heavily leveraged business incurs punitive financing costs and has little room to manoeuvre, while one with a perfectly poised balance sheet can meet both customer and shareholder expectations.
Finally, businesses must retain the mindset that there is a market for their goods and services, even in the face of profound uncertainties and a dip in the demand curve. Those that adopt the mentality that there is no market are unlikely to adopt new ways to meet customer expectations and will find it hard to fend-off competition from their more established rivals after the pandemic.
