Consumer focused companies: Looking ahead for normal times to return
Although consumer-facing businesses have been diligent and creative in responding to COVID-19 operational challenges, they must continue to focus on adaptability. Minimize lost revenue, ensure customers and staff return, and maintain momentum with six key actions.
Consumer-facing businesses have been diligent and creative in navigating sudden and rapidly changing COVID-19-related restrictions and operational challenges. While there’s reason to be optimistic, economic uncertainty around the pandemic continues, and business leaders must keep a strong focus on adaptability. As you work to minimize lost revenue, ensure customers and staff return, and keep momentum and growth moving in the right direction, consider the following six actions.
1. Stay focused on cash conservation.
Cash conservation and planning continue to drive success. Liquidity and cash flow modeling should remain a high priority to ensure the business can quickly meet demands of an ever-changing landscape. Many companies now update their cash forecast models on a weekly basis to make better decisions on where cash must be deployed since we don’t yet know when business activity will return to former levels or whether pandemic-driven growth, such as in grocery delivery services, will continue over the longer term. Your cash position continues to mean the difference between survival and permanent closure. It’s critical to keep a close eye on additional federal and state assistance programs that may be developed and be ready to provide qualification documents since demand will likely be high.
2. Innovate to your customers’ changing needs.
To say that consumer needs, habits, loyalty, and trust are evolving quickly is an understatement. Competition for customers is continuously growing as new and innovative goods and services find fast adoption in the market. The current social and economic climate has driven the consumer to be more receptive and willing to take a risk on new offerings (and who will want to give back the value of time saved by having groceries or restaurant food delivered right to our door, or by scheduling services with one click)? Consumers often will pay a premium for new products and services if they see value. Gaining consumer acceptance is critical to undertaking any new initiative, but businesses that are seen as innovative market leaders can quickly change consumer habits and differentiate themselves from the competition. The key here is anticipating consumer preferences and potential barriers to change and articulating the value proposition.
Your cash position continues to mean the difference between survival and permanent closure.
How are you innovating to meet your customers’ expectations? Are you listening to and analyzing customer feedback? Are you using social media or other platforms to engage? Are you providing unique high-value services, products, or delivery options that enhance the customer experience? Are you offering discounts or loyalty programs to reward your most loyal customers and attract new ones? Have you addressed and communicated the safety protocols that consumers have come to expect?
Finding new ways to interact with customers, collect and analyze data, and react quickly allows you to stay relevant and expand your reach. This may seem be daunting, but by fostering a corporate culture of innovation combined with strong leadership and actionable consumer data, you can create exciting, sustainable, and profitable new offerings.
3. Focus on morale and workplace flexibility.
Staffing challenges create obstacles to meeting customer expectations. The challenges of retaining qualified team members will likely continue in the mid-term, and there are several things you can do to overcome them and improve the customer experience. Maintain regular and responsive communications with employees to demonstrate their value to the business. Offer, to the extent possible, flexible work arrangements, and seek innovative ways to assist your team to help alleviate some of the stress your workforce may be under. Consider incentives such as child or elder care assistance, a home-office stipend, or additional time off.
Each company’s culture is unique, and the solutions you employ should be tailored to suit. That said, fostering a culture of transparency and loyalty transcends any business model and will improve retention and workplace morale and positively impact your customers’ experience.
Consumers often will pay a premium for new products and services if they see value.
4. Protect your IT infrastructure.
The need to rapidly move between in-person and remote work environments continues to be a challenge. Many businesses now have staff working both on-site and remotely due to mandated and individual restrictions. Phishing and cybersecurity attacks have increased significantly during the pandemic. Protecting your IT infrastructure and assessing data security is critically important to prevent business interruption and minimize the costs of a breach, both financial and reputational. This is true whether you maintain your own system or work in a third-party cloud-based environment.
Cybersecurity and IT maintenance protocols should be tested and documented to minimize the risks. As IT processes and protocols have likely changed to create flexibility for your team and customers, consider using a third-party data security expert to test infrastructure safeguards and assess any weaknesses that exist. This allows you to develop a mitigation plan and prioritize IT needs over time.
If your business is cloud-based, it’s important to be comfortable with the status of your third-party technology vendors. Are they well-staffed and fully operational? Are the turnaround times for support adequate? It’s likely they’re facing the same challenges as you with people working from home, so ask questions about their internal controls and data security. Any disruption in your IT infrastructure or data security not only severely impacts your business operations but also can be detrimental to your cash position and reputation.
5. Consider the supply chain.
Is a supply chain critical to your operations? If so, it’s important to do a risk assessment to identify your highest priority goods and supplies and implement a plan if disruption is likely. Verify that safety precautions are in place for inbound goods and consider whether key suppliers might have limitations if you have to restart or you experience increased demand. Reach out to suppliers periodically to discuss anticipated shortages in the market. Then, consider backup or alternative suppliers to meet short-term needs.
Staffing challenges create obstacles to meeting customer expectations.
Other questions to consider include: Are there new governmental regulations or inspections that may bar you or a supplier from quickly reopening in the event of temporary closure or multiple brief closures? Will there be any recertification or licensing process necessary to reopen? Any disruption could cause a domino effect, so be ready to adapt quickly.
6. Solidify your COVID-19 recovery plan.
Once you’re able to restart or ramp up operations, you’ll face another whirlwind of activity and new challenges. You’ll be rewarded by having planned ahead with a well-thought-out calendar that considers all the items discussed in this article — your plan is a critical path to quick recovery.
The plan should include an assessment of physical locations, staff work environments, customer interfaces, operating hours, and a detailed schedule of how long it likely will take to be fully operational to meet customer demands.
Talent management should be a central part of your plan. How long will it take to recall furloughed staff, recruit new staff, train, onboard virtual staff, and ramp back up? Assume a starting date, and work backwards from there so you have a clear plan and priorities in place once you know when that date is going to be. Keep your plan top of mind, and revisit it daily if necessary.
Protecting your IT infrastructure and assessing data security is critically important to prevent business interruption and minimize the costs of a breach.
There are reasons to be optimistic, but COVID-19 impacts will linger and will vary among geographies. New, unforeseen challenges will emerge. Successful companies that stay focused and flexible will continue to rely on strong planning, leadership, and focus on the consumer and staff to innovate and thrive.
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