Certified Auditors Accountants S.A.
Chimaras 8B, Marousi, 151 25 Athens, Greece
EY: COVID-19 | Twelve insights to help build your business recovery roadmap
The most essential insights from EY teams to help your organization move to the next phase of recovery from the impact of COVID-19
- As COVID-19 continues to impact people and economies around the world, we expect to see a saw-toothed recovery, posing fresh challenges for business strategy.
- While there are short-term pressures during reopening, there is also a historic opportunity to reimagine business models for the long term.
- Even if a long-term vision seems difficult amid uncertainty, all businesses need to bake flexibility into their business models to enhance their resilience.
After the storm comes rebuilding. And there’s a lot to do. COVID-19 has profoundly affected the norms of business across every industry and geography. From new ways of going to work (or not), long-lasting shifts in customer psychology and behavior, and radically transformed operational networks and business portfolios, the world in the second half of 2020 is very different from the start of the year, for better as well as for worse.
The only thing that’s certain about the recovery is that there’s still a huge amount of uncertainty about what form and how long it will take, with different countries – even different regions within countries – continuing to be impacted in different ways, and no certain cure for COVID-19 yet in sight. Here, EY teams have collected some of the leading thinking around what the working world should expect from the pandemic recovery period, and steps organizations and individuals need to take not just to get back up and running, but become stronger and more resilient in the process.
Chapter 1: Re-open, reboot
The realities of restarting a business post-COVID-19.
1. Reimagine and transform
The world is slowly adapting to the impact of COVID-19. The world is slowly waking up from the nightmare of COVID-19. But getting back up and running requires more than just business as usual. It’s a two-geared process, a balancing act between transitioning safely into new working world, and taking steps to engage in the transformation of working conditions and practices that COVID-19 has unleashed. Read more: A two-geared approach to reopening and transforming your business.
2. Address customer anxiety
The behavior and decisions of consumers are what keep the business world ticking. But COVID-19 has dealt a massive – and potentially permanent – blow to the way they interact with businesses. As just one example, 44% of global consumers indicate they would be more likely to do grocery shopping online as a result of the pandemic. Firms looking to survive will understand this and other realities, and adapt accordingly. Read more: How to serve the ‘Anxious Consumer’ after COVID-19.
3. Rethink the workplace
Some businesses have been able to opt to continue remote working practices for the foreseeable future, but for many others a swift return to work is vital to remain financially viable. In order to do this safely for their staff and customers. Organizations need to prioritize cooperation, communication and accountability, and supplement with cutting-edge technologies and working processes, including crowdsourcing, risk apps and collaboration platforms. Read more: COVID-19: How to crowdsource risk assessment for a safer return to work.
4. Maximize your people’s potential
Concern for the wellbeing of your workforce isn’t just about duty of care – it's a business imperative. Led by an integrated CHRO response, rebuilding will mean effectively engaging with the workforce, understanding and reacting to employee expectations of the care provided by employers and the ability to match workforce capability to financial and risk considerations. Read more: How does a stronger workforce drive a stronger recovery?
5. Identify legal issues
Even if the worst of the crisis may seem to be over, with interim regulatory measures still in place in much of the world, the full aftermath is yet to hit. As the world moves on from the peak of the crisis, from cancelled contracts to employee class actions, COVID-19 is likely to leave a range of legal turmoil in its wake. Modelling potential outcomes, identifying potential risks, and capturing relevant data is critical for businesses looking to weather an anticipated storm of litigation. Read more: How do you remain resilient against a wave of COVID-19 claims?
6. Learn lessons from those a few weeks ahead
When re-opening, it can be instructive to look at what has happened during reopening elsewhere – both in other industries and markets. China was the first country affected, and at the beginning of May, it became one of the first to re-open. Here we look at key lessons from its experience, from assessing supply chains to preparing for future virus spikes. Read more: What the world can learn from China’s post-COVID-19 reopening.
Chapter 2: Capital and strategy
How companies need to think, plan, and respond in the wake of the pandemic.
7. Adapt operations, increase resilience
Even before COVID-19, business was facing pressure to act more responsibly, and the crisis will only accelerate that. As we look to an uncertain recovery, likely to be more saw-toothed than smooth, the pandemic presents us with a chance as much as a challenge. With such a significant economic and social impact, radical changes in how we operate are not just possible, but necessary. This is a chance to segue from a growth economy to a value-based one, prioritizing long-term value and resilience and the needs of multiple stakeholders over short-term growth. Flexibility has always been a business advantage, but it will now be critical to survival. Julie Teigland, EY EMEIA Area Managing Partner, Read more: COVID-19: What critical choices should businesses make next?
"Flexibility has always been a business advantage, but it will now be critical to survival." Julie Linn Teigland | EY EMEIA Area Managing Partner and EY Global Leader – Women. Fast forward
COVID-19 has upended customer demand and supply chains, as well as historical forecasting methods. Companies often lack the processes and tools to make rapid decisions to address these changes.
8. Forecast more effectively
Making smart financial decisions post-COVID-19 is critical and, in such a radically changed world, only companies with effective forecasting and scenario planning strategies can do so with any confidence. However, in a webcast survey by EY, only 9.2% of respondents were very confident in these areas. This article looks at practical steps to build more robust forecasting and planning capabilities. Read more: Three ways to improve your forecasting and scenario planning.
9. Adapt to shifting expectations
For good or ill, what consumers expect of companies is changing. The EY Future Consumer Index found customers had a fresh focus on affordability and healthcare concerns, with 70% saying they’ll be more health-conscious long-term. As we move from crisis to whatever comes next, businesses need to be ready to adapt to changing customer attitudes and needs: reshaping their portfolios for new business realities, creating new and responsive digital customer journeys, and taking the right steps to ensure transparency moving forwards. Read more: As consumers keep adapting, how will your business keep changing with them?
10. Identify the right divestments
In the wake of the 2008 financial crisis, firms proactive about reviewing and strategically divesting their portfolio outperformed their peers. The same may well prove true of the COVID-19 aftermath. Indeed, in an EY survey, 64% of APAC firms indicated that the pandemic meant they would need to reduce debt through divestment measures. We dive deeper into these stats and ask how firms should prepare. Read more: Intent to divest remains high as APAC companies look beyond the crisis.
11. Encourage inward investment in your region
COVID-19 hit Foreign Direct Investment (FDI) hard, but this study, originally published in May 2020, indicated the enthusiasm of foreign investors for European assets was not quite dry, despite the region still being in the midst of the lockdown. While 23% of investors surveyed indicated an intention to delay investment plans entirely, 51% expected minor delays in FDI plans. This article examines the details and what firms can do to address these challenges – and make the most of opportunities. Read more: How can Europe reset the investment agenda now to rebuild its future.
12. Stabilize the economy
Reassuring and supporting individual customers in the immediate crisis is one thing, and something all businesses can work toward. But banks will have a particularly important role to play in the longer-term post-crisis stabilization of the global economy. This will mean finding ways to recapitalize key companies, engage with asset protection schemes, and deal with the impact of potential government-established asset management companies. Businesses will need to build close relationships with their banks to manage the inevitable risks of an uncertain environment and secure ongoing access to the capital that will be essential for their long-term recovery and growth. Read more: How banks will be vital in recapitalizing viable firms.
In the next phase of the COVID-19 crisis, a saw-toothed recovery will present significant challenges. As businesses reopen and focus on increasing their resilience, there is a window of opportunity to strategically reimagine how they operate – with a stronger focus on ensuring long-term value through increased flexibility, fairness and sustainability.
Article and Image Source: