How you communicate and treat your stakeholders today will make or break the bank of goodwill, your reputation and license to do business.
We live in changing times. The only certainty is prolonged uncertainty. No matter how optimistic we want to be, we are realists. We know our borders remain closed for our own safety while the pandemic is raging around the world. Mandatory quarantine is our new welcome mat. And while rabid consumerism is buoying retail, renovations, house sales, luxury car purchases and hospitality, the wage subsidy is petering out and redundancies are looming.
Business is grappling to find the next normal — whatever that means. The situation could change in an instant for better or worse.
For New Zealand's hundreds and thousands of small and medium sized businesses, so many of them family owned, finding, or better still, creating the next normal is an ongoing challenge. This will not be a one-off whiteboard or post-it-notes planning session.
The SME sector contributes around 30 per cent to the national economy and could be your local pie shop making thousands of pastries a day or a biotech firm listed on the NZX or ASX. The sector is too big to ignore, too big to fail.
The reason for being in business is not going to change. How a business operates will. The sector is resilient, pragmatic and determined to survive, even if it means clutching at Government support lifelines to give them time to determine the next step.
Leaders and their teams need to pause, assess the options and look ahead to reset their business to be relevant, sustainable and profitable in turbulent times. They need to resist the knee jerk to react to what was. This is a time for an evolution not a revolution. Reset will be hit many times as we and the world open for business.
There's no point in looking back at what was so familiar. Yesterday is gone. Done and dusted.
Our surveys show that an overwhelming majority of small and medium enterprises know that. They are restructuring, rightsizing, reinventing and realigning their workforce, supply chain, offering, capital requirements and customer channels to embrace virtual, digital and on-line engagement and commerce.
In the same way business operations are evolving their processes, systems, efficiencies, capabilities and skills to be fit for the future so must leaders be willing to evolve, grow and adapt their management style and behaviours.
What is needed now is courage, tenacity, empathy and openness to new ideas. Leaders care and share information. They collaborate, communicate and balance confidence with level-headed realism in emotional and tense times. Employees, suppliers, shareholders, even customers, regulators and the wider public value transparency and see through spin. They are sceptical and critical when an enterprise pulls up the drawbridge, retreats inside their fortress and restricts information on a strictly need-to-know basis. How you communicate and treat your stakeholders today will make or break the bank of goodwill, your reputation and license to do business.
It isn't easy to dare to think and act differently, to have what will be difficult conversations and make what may be painful decisions. But, remember leaders, it is not a sign of weakness to not have all the answers.
There's nothing wrong with fear so long as it's not an excuse for protracted paralysis. As Churchill and every armchair historian says, never waste a good crisis, because opportunity will emerge. One of the two characters for crisis in Chinese means 'opportunity', the other 'danger or risk'. That seems to be a good combination for creating the business of the future in this environment. Take a leaf from China and our Asian neighbours who so agilely and quickly adapt and create their own normal.
Not all businesses will survive. Owners will have to make that call and it will be very tough as their personal lives are often intrinsically wrapped up in their business. It is their life and livelihood.
But what is most important is that if the business fails, owners realise it is not their personal failing.
It is a brave person who knows when to make the call to close shop. No one should underestimate how traumatic that decision is. There is a huge personal toll, deeply felt from making people redundant, of losing the enterprise that gave meaning and direction to their day, that supported their family and other families, and contributed to the vibrancy of local communities.
Be kind, be considerate and be realistic. Good times will come again.
- Michael Barnett is Chief Executive of the Auckland Business Chamber.