The recent outbreak is shifting the way businesses operate. From alternative working arrangements to reopening guidelines, businesses are experiencing significant impacts across the globe. Above all things, it is showing the economy how to shift and navigate to the ever-changing landscape. Here are five business lessons companies should consider as we move into the "new normal" for the economy.
Companies of all sizes are monitoring the ongoing impact of the recent health outbreak. Leaders across the globe are preparing for and considering budget cuts, monitoring supply chains, conducting risk assessments, and forecasting market impacts. Events that encourage employees to have face-to-face interaction have been cut and depending on the industry, some businesses have closed their doors altogether.
Virtual is possible
The pandemic swiftly and severely impacted the world, including businesses and the economy. Many companies implemented work from home arrangements to keep the majority of their workforce safe. According to shrm.org, of the 550 employers surveyed in March, 67% encouraged and took steps to allow their employees to work from home (WFH). Since the workforce has converted, additional studies have reported the convenience, fewer expenses, and better telecommuting options as a result of the shift. Some employees have also reported more productivity. Without an end to the pandemic in sight, large and small companies have implemented semi-permanent WFH plans to adapt to the new normal.
Employee engagement and learning opportunities are critical
Even before and especially during this current challenging time, employee engagement and development pose great returns for companies. With virtual communication taking the place of physical relationship-building, companies need an engagement strategy more than ever before. A Gallup report found that employees are three times more likely to be engaged if they receive feedback from their manager a few times per month. Additionally, companies with an employee development strategy report 11% greater profitability and are twice as likely to retain their employees. Gallup also recommends several approaches to increasing engagement and providing learning opportunities (even with budget cuts), such as providing ongoing coaching and support to your employees and setting up a virtual network for learning opportunities.
The idea of well being has taken new heights in the workplace, encouraging employers to be more compassionate and understanding. Many companies have implemented "pulse check" surveys that are distributed to their employees to understand how the pandemic has affected them. Companies have also implemented wellness resources for their employees regarding stress management, mental and physical health, and times of disruption to ease COVID-19's ongoing blow. Other companies have taken the PTO approach and have instituted mandatory time off policies and have provided paid time off for employees that are sick or caring for sick relatives.
Adaptation is important
Many companies are reconsidering the outlook of their employee policies. Gallup cites that about 31% of employees were working from home pre-pandemic, and now, 62% of employees are working remotely. On the flip side, many companies were not ready for a quick transition. Companies had to adopt videoconferencing technologies, virtual collaboration tools, and ensure securities were appropriately set for their employees to access their network from remote locations. Additionally, the COVID-19 pandemic created opportunities for leaders to accommodate workers' needs for flexibility – including work schedules, child care, and location.
As the pandemic continues to shift our daily lives, businesses need to understand critical considerations as the workplace is continuously redefined. Undoubtedly COVID-19 is devastating, it is imperative companies learn to grow out of dismay and create better, stronger, more enjoyable workplace settings for their staff to, ultimately, drive businesses forward.
The COVID-19 crisis has shifted life as we know it. All parts of the economy have been impacted in some way, especially businesses. Whether it be smaller percentages of sales, furloughing employees, or shutting doors permanently, businesses have been left to navigate the unknown. To alleviate some of the impact, the COVID-19 Aid, Relief, and Economic Security (CARES) Act was passed and signed into law on March 27, 2020. The CARES Act aims to provide fast and direct assistance to American workers and small businesses, and to preserve jobs. Under the CARES Act, the federal government enacted the Paycheck Protection Plan (PPP) to assist small businesses with near-term operating expenses.
This $349 billion SBA lending program offers a 100% government guarantee and covers loans starting February 15, 2020 to June 30, 2020.Companies can use the loan for payroll, interest on mortgage or debt loans, and more. The bonus is if the loans are used to retain company employment, it turns into a grant. Loans are capped at $10,000,000 or 2.5x your average monthly payroll.
So, how has the PPP affected Ohio’s small business industry so far?
The qualifications require businesses to have 500 employees or less.Securing a loan during the first round has not been the easiest, though, so many of Ohio’s small businesses are hoping for a greater impact with the second round. Business owners were challenged with a faulty site for the application process that constantly crashed, and extremely long waiting periods for funds after submitting their applications. Even more cumbersome, many business owners reported not receiving nearly as much funding as they had applied for.
In some cases, business owners were able to secure a PPP loan swiftly. A news source in Dayton reported that after Capitol Cleaners of Miami Valley received its PPP loan, they were able to invite all of their employees spanning 10 locations back to work and maintain pay levels. Capitol Cleaners is responsible for cleaning some of Ohio’s essential workers’ uniforms.
The second round of funding was quickly accounted for, and is projected to positively impact the health of small businesses in Ohio. The SBA approved $2.2B nationally for the second round of funding. According to Dayton Daily News, close to 60,000 small businesses in Ohio were approved for $14B in loans in the first round, and $4.71B in the second round. On average, loan sizes for the second round were $79,000. While loan averages are down from the first round’s average of $206,000, small businesses are hopeful they will see more of the second round’s funding to help survive during these trying times.