COVID-19. Six months ago, it was something nobody but perhaps some virologists had heard of, let alone experienced. Now the “coronavirus economy” is a global event that will be remembered and written about well beyond most of our lives.
There are only a handful of historical events like this that happen in one’s lifetime. This one is particularly terrible because it’s not only wreaking havoc on our global economies, our local communities, and our professional careers — it’s also posing real threats to our personal health, our safety, and even our lives.
The economy is stumbling into the unknown. We’re entering unfamiliar and uncomfortable territory after a staggering 129-months of economic expansion in the U.S. (June 2009 – Mar 2020). In April alone, more than 20 million people lost their jobs, according to payroll data from ADP. Businesses are shuttering, employees are being laid off and furloughed, and hiring freezes are being put into place everywhere.
It’s a New World for a Lot of People.
Many professionals working now weren’t even in the workforce yet when our country and the world experienced the last recession in recent history. Many current business owners hadn’t yet created the businesses they’re now desperately trying to save. And many people who didn’t yet have partners, or children, or debt to worry about in 2007 when the Great Recession was just starting to hit have all three now.
And yet, there are also many people who did have all of these things the last time around. They can sense the challenges ahead, like ominous storm clouds rolling in the distant sky. They’re like storm chasers, reading the signs, watching the winds, and making educated decisions based on their experiences.
As business owners and as people, we have two options in times like these: wait for the storm to blow over and hope to survive, or take action and fight. Fight for your life. Fight for your business. Fight for your employees. Fight to keep your dreams alive.
If that sounds like doom and gloom, it’s not. I think we’ve all had enough of that for a while. I just needed to set the stage. The aftermath of this is only just beginning, and we need to read the business signs so we can plan ahead.
This article is about hope and planning — lots of planning. But successful planning depends on accurate and adequate data inputs.
I recently interviewed six brilliant female leaders who have inspired me. They aren’t waiting around to see what happens with the “coronavirus economy.” They aren’t waiting to find out how we all come out of this thing. They’re here for the fight and preparing for what will likely be a long battle. In this article, I’ll share some common themes from the conversations I had with them about the current state of their businesses, the impact of COVID-19 on their teams, and their thoughts on the future of the economy.
Teams are Becoming More Focused Than Ever.
The spread of COVID-19 has forced many business owners to make very difficult decisions to keep their businesses moving forward. For some, it has meant tightening the budget and cutting unnecessary expenses. For others, it has meant making even harder decisions.
“Eighty percent of our revenue is derived from our wholesale business. Almost all of this revenue has been canceled or delayed due to this global crisis,” said Joanne Cloak, founder and CEO of Jofit, which was ranked as the number one women’s apparel brand in private clubs in a member survey by the Association of Golf Merchandisers.
This loss of revenue forced Cloak and her team to make tough decisions that would ultimately impact team members, retail stores, and the launching of new collections.
“The product for these deliveries has been received in our warehouse. The following collection is on a vessel on it’s way from Asia, and too late to cancel or delay. We quickly realized we needed to eliminate costs, delay deliveries, plan to reschedule collection launches, close retail doors, and reduce expenses,” said Cloak. “This meant massive layoffs. We have a fabulous, passionate team that we consider family. This was difficult.”
Despite these challenges, Cloak and other leaders are choosing to lean in and focus on what they can control.
Amanda Brinkman is the creator and producer of The Small Business Revolution, an award-winning series on HULU and Amazon Prime. The series follows Brinkman and her team from Deluxe as they work to revitalize small towns in the U.S. by helping small business owners.
Brinkman has a lot of experience helping business owners navigate challenging times. When I spoke with her, she shared her thoughts on what leaders should expect and what they should be focusing on during a time like this to ultimately come out stronger on the other side.
“It will be about cutting out excess spending, tightening the budget and making sure you are covering your fixed costs as a business during the next few months,” said Brinkman. “However, this is also a time to be tightening your business plan. Drop those distractions – whether it be half-baked ideas you could never really get off the ground or avenues you have tried that haven’t been successful. This is the time to shed the excess of ideas as well, and get laser-focused on your business.”
Another leader I spoke with, Sheila K. Erickson, agrees. Erickson is the V.P. of Marketing & Ecommerce at Slumberland Furniture, a large furniture brand with over 120 stores in 12 states throughout the midwest. As a marketing leader with experience driving growth on big-budget brands, small-budget brands, at marketing agencies, and at a start-up, she has a lot of experience navigating turbulent times across many different types of businesses.
When asked about how business leaders should be responding and acting as they continue to be impacted by COVID-19, she said the following:
“It’s a chance for businesses to reset on the people-front,” said Erickson. “It’s also a chance for leaders to get closer to what is absolutely essential to move their business forward.”
Focus, it seems, isn’t the only thing leaders will need to survive the current economic crisis. They’ll also need patience; and a lot of it.
Businesses Are Running the Marathon, Not the Sprint
Although many states are loosening shelter-in-place restrictions and slowly allowing businesses to reopen, we still have a long way to go until things return back to the way things were before COVID-19 began making its way into communities across the country. Some believe it will take years.
Others don’t think business and communities ever will look the same and are now planning for the “new normal,” a term that is typically used to describe conditions following a recession or significant global event like the one we’re experiencing now.
One common theme I heard again and again when talking to business leaders about how to navigate COVID-19 was patience.
“It seems the country is eager to get back to business; however, the virus will still be a threat until the population can be inoculated or vaccinated,” said Joanne Cloak. “The CDC tells us the vaccine will not be available for at least 12-18 months. 2020 and half of 2021 looks to be cautiously slow and safe. Until this time, we will continue to operate assuming a very reduced revenue.”
Amanda Brinkman shared similar advice when I asked her what business leaders should be doing to survive.
“Focus on what your business does well, where areas of growth are and what consumers might want long after this crisis is over,” said Brinkman. “It will be a good practice now to think of your solutions, not as short-term fixes to survive, but as new opportunities that you’re developing for the future.”
Whether we like it or not, we’ve all just walked over the starting line of a marathon. To make it to the end, we can’t run it like we run a sprint. We have to pace ourselves. We have to be strategic. We need to keep reserves. Planning ahead is important. We need consistent effort and reliable strength throughout.
It’s going to require us to pay close attention to not only the health and sustainability of our businesses but also the health and care of our own minds and bodies.
Leaders Are Putting Care and Well-Being Above All Else
The survival of your business is important, but not as important as the health and well-being of your people. That’s the stance that virtually every business is taking in response to COVID-19.
It makes sense when you think about the health challenges associated with COVID-19. Aside from the symptoms and complications people who test positive for the virus are experiencing, there are a number of other challenges that people are facing as a result of the situation we’re now all in.
Anxiety and depression are rising, according to an article published in the Washington Post. Specifically, the article shared the following concerning data points:
- “Nearly half of Americans report the coronavirus crisis is harming their mental health, according to a Kaiser Family Foundation poll.”
- “A federal emergency hotline for people in emotional distress registered a more than 1,000 percent increase in April compared with the same time last year.”
- “A study of the Great Recession that began in late 2007 found that for every percentage point increase in the unemployment rate, there was about a 1.6 percent increase in the suicide rate.”
Needless to say, health and wellness should be a big focus for leaders right now.
But saying you care about the health of your employees is one thing, and taking action is another.
So what should leaders do for their people and for themselves?
Joanne Cloak is making sure her team feels safe and engaged.
“It’s difficult to ask team members to reach beyond their own comfort zone when it’s this dangerous. Most of our team members are working from home,” said Cloak. “They remain engaged, driven and passionate. Zoom has been a blessing! We are not experiencing much anxiety because we are not asking them to put themselves in danger.”
Amy Halford, who was recognized as one of Advertising Age’s “Women to Watch” in 2016, Brand Innovators “40 under 40”, and Top Rank’s “50 Influential Women in Digital”, also had a lot of great advice to share on this topic. As the Global CMO of Self Esteem Brands, which owns and operates brands such as Anytime Fitness, Waxing the City, and others, she focuses a lot of her attention on developing strategies and processes that ultimately help address and improve the health of her team members.
“When you are working from your couch it can be difficult to mark a definitive ‘beginning’ and ‘end’ of your day and when you feel disconnected from your team you can easily lose a sense of priority,” said Halford. “All that, on top of feelings of isolation and worry about your family’s health and the economy certainly can have a toll. We’ve been coping by being honest about those feelings, by communicating frequently with staff about what we are doing, about the priorities that are right in front of us. Communication and connection with leaders is so important right now as staff needs to see you and hear from you,” she added.
Halford is also working closely with her team to make sure their franchise owners feel supported and can provide their own support to customers who are used to socializing in gyms regularly.
“We are making every effort to support our independent, local franchise owners and encourage them to engage their customers, staff and communities with an emphasis on health, safety, and wellness through an incredibly difficult period,” Halford shared. “We have launched virtual content for fitness, nutrition, health and wellness coaching that is accessible publicly. We’ve also provided existing members with virtual content that are extensions of their memberships. In a way, this crisis has helped us to accelerate our strategy to support our members and clients anywhere, anytime,” she added.
Goldie Chan, the “Oprah of LinkedIn,” had similar advice to share in terms of taking time to check in with people and create regular opportunities for people to communicate and share their feelings with one another. Goldie is the founder of Warm Robots, a social media strategy agency based in Los Angeles with global clients, like Adobe.
“I believe in leading with care (which ties into my company’s tagline – “Social Media with Purpose”),” said Chan. “As a leader, doing appropriate emotional check-ins and offering team members wellness and mental health days only helps to strengthen a team and a team’s overall output. By creating a flexible (within reason) environment – the team is encouraged to speak up and voice their concerns without fear of reprisal, making it a less anxious environment regardless of the climate,” she added.
Many leaders are finding that when they take time to care for employees and give them the tools and resources they need, it doesn’t just lead to better health and well-being, it also allows for more creativity, innovation, and change in the workplace.
Workplaces Are Evolving by Choice and by Necessity
No one is standing still right now—innovation is happening everywhere. For some leadership teams, it’s a strategic choice, and for others, it’s simply based on necessity.
The leaders I spoke with all had great advice and experiences to share about how their workplaces have changed and are continuing to evolve due to COVID-19 and the current economic situation.
“During this period we can operate with just a few team members, test our D2C plans, and exist on a tight budget,” said Joanne Cloak. “This will allow us to take a nice long look at a slightly adjusted business model. Wholesale is still our bread and butter. Once the world is back to business, we will be prepared, and D2C will be icing on the cake.”
Sheila K. Erickson is enabling her team to work through the situation by helping them focus on what matters and what they can control.
“The anxiety lit a fire under some people, and working gave them focus and purpose during this time. Some team members have absolutely shined and immediately got into a ‘whatever it takes’ mode as our business started reacting and changing, said Erickson. No one wants to be furloughed, and I told the team we all need to work as hard as we can right now to be absolutely indispensable. I take that same approach for myself – and hopefully the team has all seen that and I have set the example.”
Another person I spoke with, an HR leader at a public company who asked to remain anonymous for this article, saw positive changes, more innovation, and a better company-wide attitude about accommodating people who have wanted to try working remotely in the past.
“It’s tough but it’s not all bad,” she said. “I’m excited about how this will permanently change our workplace. We were pushed to do things that seemed too risky just six months ago, from more teams working remotely and more types of positions working from home to new uses of technology. Sometimes even when a company wants to implement more of these types of work arrangements, managers may be reluctant so this crisis has forced us all to face unfounded fears about more flexible work,” she added.
Flexibility and a willingness to take risks and innovate will be crucial for business leaders and teams, especially as the economic situation continues to progress and evolve.
There Are Still Many Unknowns
Despite signs that the country and world are ready to start slowly opening back up, there are still many unknowns that will continue to impact business and the economy for the foreseeable future.
I wrapped up my conversations with a few leaders by asking them how they felt about where the economy is going and how their business might be impacted in the long-run.
Sheila K. Erickson predicts that the future will probably look much different for physical retail stores, especially given the fact that 30% of all retail spending is now happening in ecommerce environments.
“It is hard to put in writing how bad things will be based on where we are at today – but it’s not good. Many big-name retailers will fail hard, and many probably for good,” said Erickson. “When you ask yourself ‘does the country need this business on the other side of this?’ – in that framework you start to say ‘no’ to a lot of retail. I am happy to say the world will still need furniture, and people for the most part still like to sit on a couch or lay on a bed before they buy, so we will still need our furniture stores. But so many big parts of the economy will be at a crawl compared to where it was before.”
Amy Halford agrees that the full impact of COVID-19 on the economy and on consumer behavior is tough to predict. Instead of worrying too far into the future and into the unknown, she and her team are focused on doing what they do best: supporting their customers and partners.
“It’s difficult to speculate as the situation and implications for the health of our communities and the economy is changing day to day,” said Halford. “Our immediate focus is on supporting our franchisees and their members through this crisis. We expect that roughly 80% of people who have gym memberships intend to keep those memberships, which is encouraging. Consumer interest in health and fitness won’t go away,” she added.
Despite these unknowns, there is always a beginning and an end.
But There is Light at the End of the Tunnel
It might not feel like it today, or even tomorrow, but there will be a day when things return to normal (or, at least, a new normal). The best thing we can do as leaders is stay focused, stay driven, and stay positive. Good things will come again soon to those who can be strategic, innovative, and patient.
Goldie Chan gave me one last prediction at the end of our conversation about the current state and near future of the economy.
“It’s tough as we’re moving into new territory in 2020. As we think about Q2 and Q3 especially, both the US and global economy will be in a state of transition, slowly moving towards bigger spends on brand-building, creative work, and paid ad campaigns,” she said. “I do believe we will be on the road to recovery by Q4 of 2020.”
Let’s hope she’s right, but let’s also set our pace for the marathon.
This article was co-authored by Rob Wormley. In full disclosure, Jofit is an advertising client of Elumynt.