BUSINESSES FIND NEW EQUILIBRIUM IN UNCHARTERED WATERS

It is increasingly clear our era will be defined by a fundamental disunity -- the period before coronavirus pandemic and the new paradigm that will emerge in the post-viral era -- the “new normal”

In this unprecedented new reality, we will see a dramatic restructuring of the economic and social order in which businesses and society have traditionally operated.

And beyond, we will see the beginning of discussion about what the next normal could entail and how sharply its contours will diverge from those that previously shaped our lives.

While organisations shift and adapt towards ensuring immediate business continuity and shock resilience, others are already considering what their business functions will look like on the other side. Managing through a crisis towards a sustainable business means that leaders need to consider how major global crises may affect their operations, in the immediate, near and long term – and how to manage for success on the other side.

Companies need to act fast, stay informed, and do whatever it takes to survive, adapt and contain the business impacts from the pandemic. They need to focus relentlessly on the necessary short-term arrangements required to weather and survive, adapting to new operational paradigms, and containing damages.

Cash flow issues that plagued companies for months was the final straw as no other options were available except to cease operation. Whether the decision is meant to be temporary or permanent remains uncertain.

Research Manager in Economics and Business at the Institute for Democracy and Economic Affairs (IDEAS), Lau Zheng Zhou says small and medium enterprises (SMEs) will be badly affected in terms of cash flow as many of them may not have reserves saved up.

Lau points out that prior to the outbreak, businesses were already feeling the brunt from the US-China trade war in 2019 and with the Covid-19 pandemic happening now will only add to the burden.