Your Home is Your Castle
My recent ruminations on the state of the residential property market as discussed with Shaun Harris during April 2020.I think realistically there is cause for optimism – the sector is transforming itself and more importantly it is going to be a very long and windy road back. Enjoy!
THE IMPACT ON YOUR BUSINESS AND HOW YOU HAVE ADAPTED TO MITIGATE IMPACT?
The global pandemic represents, in my view a true ‘black swan’ event, whose impact is likely to be felt long term and will undoubtedly alter profoundly how business operates globally. Unlike previous predictable events (say the Financial Crisis of 2008), we truly have no idea how this one is going to play out and I would caution against making firm predictions, based on insufficient data and simply not enough time to analyse the full effects.
That being said…
APART FROM LIQUIDITY ISSUES, HOW HAVE COMPANIES BEEN HARDEST HIT?
Clients are anxious and frightened. They are concerned about not only their own financial future (and in many instances that of their staff) but also worried about their physical health and safety given the vast income inequality that exists within the SA economy. Obviously, many businesses have had to close their doors or alternatively operate remotely placing greater reliance on information technology and connectivity.
AND THOSE THAT HAVE BEEN ABLE TO RIDE OUT THESE INTERRUPTIONS, FOR NOW, WHICH RISK MANAGEMENT SYSTEMS ENABLE THEM TO DO SO?
My advice to clients has been its “OK” to worry. We are entering into uncharted territory; fear is a natural outcome, but just don’t let the fear promote paralysis. Keep moving forward, one step at a time, controlling that which you can control and letting go of that which you can’t.
Those in the tourist, travel, leisure and event industries have been hit the hardest. Going forward, as the financial impact of the virus begins to bite deeper, those industries that rely on ‘discretionary spend‘(e.g. beauty salons, fashion brands, gyms etc) are likely to be adversely affected as consumers are forced to cut all extraneous expenses from their budgets.
Those institutions that remain nimble, flexible and capable of pivoting their business models in the short-term are not only surviving at the moment, but many are actually thriving. By way of example, I have a who client who runs a 500-seat call-centre out of JHB. About 10 days before the shutdown he got laptops to the majority of his call centre operators and they are continuing to service their clients from home, unlike many of his competitors who have been forced to suspend operations. Clients are
clamouring for his service, so much so that he is planning on expanding his operation by at least 250 seats, during the shut-down.
For me it is all about remaining flexible, responsive, adaptable and responding to opportunities when they present themselves.
KEY TAKEAWAYS FROM THIS PANDEMIC FOR BUSINESS OWNERS IN PREPARING, AS MUCH AS POSSIBLE, FOR A SIMILAR EVENT IN FUTURE?
By continuing to add value to them and their needs during the crisis and they will remember you when things return to the ‘new normal’…as it will inevitably do.
Adopt an open and transparent communication policy with staff, customers and suppliers. ”We are in this together, if we stick together, we have a better chance of emerging, transformed yes, but emerging”.
THERE’S A LOT OF SPEAK AROUND THE SO-CALLED NEW NORMAL. HOW
HAS THE PANDEMIC CHANGED BUSINESS OPERATIONS AS WE KNOW IT?
IN OTHER WORDS, WHAT IS THE NEW NORMAL?
Flatter, more adaptable businesses that offer real value to customer wants and needs. Businesses that can pivot quickly and adapt to changing realities.
Businesses that display a combination of strong cash flow, but also embrace social responsibility. “We are entering the realm of more socially responsible capitalism…I suspect (hope!).”
A new model of cooperation between government and business, characterised by joint venture and improved cooperation between public and private sector.
ADVICE TO COMPANIES IN ADAPTING TO THIS NEW ENVIRONMENT?
- Courage and resolve – this too will pass
- Its ok to worry – just don’t panic and do nothing
- Be flexible and adaptable – chuck out your old playbook and embrace the new ‘normal‘. Look for
- opportunities they do exist!
- Protect your cash flow (as best you can) – cash is king at times like these
- The situation is likely to remain fluid and flexible for some time -embrace the chaos.