We Need to Lead and Innovate our Way to a Business Recovery

As we watch the Covid-19 pandemic unfold, in real time, on our television and computer screens, we are observing major weaknesses in many of our essential institutions. Despite the warning from China at the beginning of this year, North Americans were unprepared for this pandemic. Before it even began, pandemic readiness work triggered by HIV and SARS epidemics had already been abandoned or scaled back for political rather than health concerns, leaving all of us vulnerable. Then there was a failure of the U.S. president to listen to the warning signals, to take responsibility for this crisis, to activate policies to produce protective equipment, to implement a national stay at home policy, and to ensure there were adequate tests to identify those who have Covid-19 and those who do not.

Our health care systems were overwhelmed by a lack of planning and resources. Our grocery and household goods supply chains were not ready for the huge upswing in online shopping and for the surge in demand for many items.

The result of these failures is that the United States is now the epicenter of the virus. Canada is also being hit hard. The pandemic is forcing millions of Canadians and Americans, other than those designated as providing essential services, to say at home to help reduce the spread of Covid-19. This necessary policy is causing the ongoing shutdown of many businesses and a loss of millions of jobs. As outlined in this article in Foreign Policy (https://foreignpolicy.com/2020/04/09/unemployment-coronavirus-pandemic-normal-economy-is-never-coming-back/), the “normal economy is never coming back.”

We are already seeing significant changes in our everyday lives. Many of us are becoming proficient at meeting with our family, friends and colleagues via a video conference. This trend will likely become more prevalent in our business lives after the crisis. Many people are becoming more skilled at purchasing groceries and supplies online and are taking the opportunity to upgrade their abilities in banking from home, home schooling, personal fitness, hair cutting and in a variety of other areas.

We are seeing some businesses adapt to the new realities. Companies in the food producing and retailing industries are expanding their take-out and delivery options and upgrading their online operations. Other companies are retooling their operations to provide much needed protective clothing and ventilators. From underwear manufacturers to haute couture brands, apparel companies across North America have pivoted to help fill the need for medical gear. Breweries and perfume factories are making hand sanitizer. ARC’ TERYX, a manufacturer of outdoor apparel, is producing 30,000 gowns for medical workers. Ralph Lauren is making 250,000 face masks and 25,000 hospital gowns. Some of these adaptations, techniques and processes will persist and influence our manufacturing and distribution methods as the crisis eases; others will not. Evaluating and preserving the best of these will be an important aspect of recovery.

Since it is likely that the “flattening of the curve” will vary from region to region, across North America, and be spread out over time, some businesses and their workforces will be out of operation for at least several months. While government aid programs will buffer the financial impacts of the virus for a specific interval, many workers will fall behind in their rent or mortgage payments. If and when they return to work, their consumption patterns will likely change. Many workers will be required to first pay off their government loans and this will impact their ability to purchase non-essential goods. If an individual has been out of work for several months, what is the likelihood of that person purchasing a new car or boat, or even a new set of clothes, upon their return? Changes to buyer behavior will force changes to the goods manufactured and distributed by many firms.

Even if sales of many goods and services do eventually recover to something close to previous levels, they will all recover at different rates and times. This means that evolving demands on supply chains will not simply be a “scaling up” or “scaling down”, but sector by sector spurts during which other supply chain elements will have to find their footing and relevance, in new arenas, while other sectors of the chain are barely coping with newly increased demands. Competition will remain vital; however, collaboration may be a key to survival.

The pandemic is already causing extreme delivery imbalances. Some businesses are facing a severe shortage of delivery capacity; others are experiencing a dramatic slowdown in their business and have excess capacity. In some cases, the challenge is the need for a dramatic improvement in productivity; in others, the challenge is minimizing transportation costs.

Covid-19 is also exposing the weaknesses in many companies’ sourcing strategies. Whether it is finding new supply sources now, being able to ship cross-border or how to mitigate risks in the future, companies will likely need to diversify their supply chains.

It will take a combination of leadership and innovation to adapt to and conquer the changing realities of the post Covid-19 environment. Business leaders will need to be the change agents, crafting and executing plans to respond to a new set of requirements. Similarly, there will be a need for innovation, to develop new and improved processes and products to meet changing consumer demands. Leaders who go back to old work paradigms, or innovations introduced without strong leadership and execution, will likely fail.

Dan Goodwill & Associates has as its mission, “Delivering Transportation Solutions.” For the past 16 years, my colleagues and I have been successfully delivering on this commitment. On our website, you will find the names of some of our valued clients. You will also find several testimonials.

If you are a Canadian manufacturer or distributor of consumer or industrial goods, we are available to help you. Please contact me at dan@dantranscon.com during this pandemic and we will provide an initial telephone or web-based consultation free of charge. We will try to respond to as many requests as we can.

During this discussion, we will provide you with a new set of eyes and ears. We will facilitate a discussion on problem / opportunity definition and if we are not able to reach that point, provide guidance on gathering the data to achieve this result. Time permitting, we will try to identify some potential options for consideration. If, after these initial discussions, there is value in discussing a consulting assignment, we can do so at that time.

Covid-19 is changing our world. It will require a unique combination of Leadership and Innovation to take many companies “over the hump.” Stay safe during this crisis.

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