Last week might have been about growth and significant new initiatives.
It could have been about retaining employees and closing that new deals round and launching that new product. Last week was about glistening things. Growth was our devotion, and our Team was closing deals and booking revenues.
But we woke up in a different system, a system where part of the community got a shield from healthy social life (or will be soon) due to the spread of COVID-19. This new world calls for new rules. Your new belief is now survival, and your new God is called liquidity. I like to bet none of you had a “global pandemic” share in your 2020 financial planning covering.
Our job isn’t about winning the best alternative anymore — it’s on finding the least damaging option:
Whatever your preferences were in the last couple of weeks, your new top priority needs to be cash. But there are more things to consider in moments like these. Handling a crisis can be hard, notably if it’s our first and has the magnitude of the current one. Let’s consider these points to get a bit of a direction.
1. ‘Organize a daily COVID-19 “War Room”:
The idea of “war rooms” clearly originated from military methods and means placing together a real or virtual space to accumulate all mission-critical data and to bring relevant teams together to make quick decisions.
Set a daily war room to make relevant people together to compose smart decisions concerning coronavirus and its impact on your startup and your Team. You should gather your co-founders and administration team periodically to review new information and make decisions. Use these meetings to observe your Sales pipeline, revenues thoroughly, and, most importantly, to track your cash flow and cash in hand.”
2. Dump your 2020 strategy and marketing plan and bring out a blank page:
Most magnificent 2020 policies were designed based on a more or less regular worldview. New realities call for new ideas.
There is not enough knowledge and certainty about the situation to create a robust new plan just still. Driving your boat in times of emergency will need a lot of course improvements and smaller tactics. So make the outlining part of your regular war room and improve the forecast as you gather new data. Your new target of consideration in the primary planning method will become liquidity”
3. Plan a safe work culture by “work from home”:
By now, this might be a no-brainer, but it’s still worth it. Most startup founders I know have sent their Team back to work remotely, and those who haven’t should. With a lot of nations performing various social-distancing management, remote work looks like the most reliable and most feasible thing to do. Of course, this means that productivity is going to drop tentatively. But let’s be practical: What would productivity look like if somebody sat around scared in your workstation fearing to become infected? Or if they just declared in sick and didn’t show up at all?
4. Pull in money from all means:
Concentrate on the most straightforward action steps to protect and pull in liquidity in times of emergency. It won’t be easy: A lot of other businesses are in the same dilemma as you are, so acting fast and decisively is paramount.
One important thing to keep in remembrance while optimizing your cash flow: Every rupee you draw in or don’t pay out has to grow from (or be delayed from) somewhence else. So please always think about with whom you are dealing. If you owe a couple of lacks of rupees to a big corporate enterprise, paying later doesn’t make much of a difference to them. But if you owe it to a freelance subcontractor whose bookings might have already imploded and who requires to raise a family, that’s an entirely different story.
5. Understand that your funds can (and apparently will) get out of control:
Your transactions have likely already been affected by the new situation. A tiny number of companies’ profits will soar (imagine online education, video conferencing, e-commerce for household goods, etc.), but most will at least temporarily decay or decline. In the B2B industry, signing up new clients through a sales team might turn out to be challenging because of the lack of physical communications, as well as a general investment freeze.
6. Notify your clients about continuity in work:
As much as you rely on your suppliers, your clients depend on you. So take the chance and write thoroughly about how you will advise your service and if consumers should expect any constraints. Remember to communicate.
“Shots will nevertheless be there in a couple of months. There is no need to rush, except your core market is doomed. If this is not the problem, focus all your strength on maintaining and protecting what you have made so far.
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