On 11th March 2020, the World Health Organization declared the dreaded COVID-19 as a pandemic and by 24th March, the nation was appealed to go through a 21-day lockdown by the Prime Minister of India. With the Government and the Finance Ministry churning relief packages to protect the underprivileged citizens from the deadly coronavirus outbreak; on the corporate front, the small industries and the MSMEs are facing the brunt too. The coronavirus breakdown has brought about many unexpected implications on business, wherein small businesses, who run on a day-to-day wage model had to take a massive hit on the revenue generation as businesses came to a stand still.
In times like this, to have direct, positive implications on business, organizations must identify the critical business processes, the key employees, staff, and third-parties that are bound to be affected by the coronavirus crisis. The plan should be to red-mark these sectors as the situation could be overwhelming for them to handle. With the help of the HR compliance officers, they should draft a policy to ease their stress and ensure job security during the period of lockdown. The employees are the backbone of the organization, hence, it is important to protect them first. Prioritizing the health and safety of the employees first before sending out policies to continue smooth operations is a must.
To ensure business continuity, immediate yet precautionary measures are being taken by the organizations. Remote working, organizing webinars and online workshops to keep the employees motivated to work, rolling out salaries early to ensure the employees are at ease while they work from home, etc. are some of the measures that are being taken by organizations. For those companies that are operating in the essential sectors, since they ought to hire more workers to meet the rising demand, they must ensure the social distancing policies are strictly adhered to and prioritize the safety of each worker. For those employees working from home, employers must ensure that their employees are updated and engaged and keep them motivated as they continue to work from home. Several companies have made necessary investments in extra laptops, Wi-Fi dongles, and power banks too, to support remote working.
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Here are some measures that every organization must follow to counter the COVID-19 implications on business:
- Safeguard the welfare of the employees, staff, and customers (especially in the case of companies that deals in essential goods)
- Protect the welfare of those impacted by the coronavirus or those who have asked for self-isolation
- Create several risk and crisis management teams that will not only maintain the flow of information through the hierarchy but also handle the key customers and suppliers
- Identify the risk factors – that is cut down on pre-booking costs and address the anticipated shortages
- Evaluate material and other options near or around the company that could help the business during scarcity
- Since the stock market is fluctuating and declining, chart out ways to access funds to maintain financial stability
- Re-systemize the business plans, strategies, and cash flow to meet the current demand and supply and also meet potential demands
COVID-19 impact on MSMEs /SMEs
One of the worst-hit sectors is the MSMEs of India, which is the Ministry of Micro, Small and Medium Enterprises that mainly depend upon day-to-day business turnovers to pay their employees and vendors. Unprepared for the lockdown, and overwhelmed by the expenditures and potential losses they may have to endure, they are appealing to the government for assistance.
The question of their existence if the coronavirus lockdown was to be extended, is what makes the MSMEs appeal to the government for a moratorium of 6 months on their bank loans and transactions. They are requesting the Government to direct the banks to go lenient on the loans and other transactions and not mark them as NPAs. Considering the Governments of other countries like the United Kingdom and China have rolled out relief packages to help small businesses, the Government of India is yet to announce relief packages to survive during these challenging times. Also, lest we forget, these sectors form a major part of India’s economy. Hence, their downfall will have a grave impact on India’s goal towards a $5 trillion-dollar economy by 2025.
India’s SMEs too, that are the small to mid-sized enterprises, are struggling to battle the overwhelming expenditures and losses incurred due to the coronavirus outbreak too. Since most of the SMEs are labor-intensive, they require immediate fiscal relief to keep their workforce secured and their machinery and plants in operation if they have to survive the COVID-19 pandemic. SMEs are employers to over 100 million people in the nation and with no funds to meet monthly demands would lead to downfall in no time, which in turn will inadvertently affect the vast working population in the country. Hence, these enterprises are turning to the Government for immediate aid and for leniency on loans and bank transactions to prevent major losses.
The COVID-19 pandemic is nothing but a tragedy that has been brought upon the Indian economy, enterprises, and corporates as well. And not just Indians, the entire world is facing the adverse effects of the coronavirus pandemic and lockdown and the recession is spreading roots in every country that has been gripped in the horrendous clutches of the coronavirus outbreak. Despite the struggles and strenuous challenges brought upon, MSMEs and SMEs wait for Government’s fiscal relief to survive, while the corporates step up to join the cause of the essential workers to flatten the curve. This only brings us back to the main question – Will the Indian organizations & economy be able to survive the COVID-19 pandemic? Only time will tell.
You might also be interested to read: Coronavirus Crisis: A CHRO Is The Need Of The Hour For Your Human Capital
References:
- Embedding resilience – A quick guide to the business implications of the coronavirus (COVID-19) outbreak
- When is the Government going to respond? Businesses look for assistance as coronavirus starts hurting – Pranbihanga Borpuz ari & Shariq Khan – 19th March 2020
- India needs stimulus plan or it risks crippling small businesses: Industry bodies – 24th March 2020
- Business implications of COVID-19 – Protecting your staff and business during volatile times
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