As businesses continue coming to term with the short and long term impact of Covid-19, there are several positive steps businesses can take to safeguard themselves against similar crises in future, writes Neill Fallon, COO and Co-Founder of Eppione
It’s fair to say at this point that the Coronavirus crisis has changed everything. It’s difficult to say just how much before it has passed completely, and who knows when that will be, but the work world has been turned upside down for good.
While we’re still waiting for the dust to settle, here are four certain ways a business can help safeguard itself and its employees to lessen the impact of COVID-19.
- Contingent Planning
Contingency plans are often based around office or building closures. Most businesses have robust and efficient plans in place regarding their assets, employees and cash flow. However, based on our correspondence with clients, there are very few contingency plans that include actions relating to a global pandemic.
It is important to look at how COVID-19 has affected your businesses assets. Office closures, remote working and in some cases a reduction in staff have become commonplace over the last number of weeks. Take these changes into consideration while also looking after your employees. Their emotional, physical and financial capacity could be worn thin, having a potentially detrimental effect on productivity, during a time when your business needs it most.
Make a new contingency plan incorporating all of this, bearing in mind that the situation is probably going to get worse before it gets better. Contingency planning will become even more important to investors, debtors, employees and customers as we move forward into the new future.
- Future Cash flow
When putting together a financial plan for individuals, we always advise building a cash reserve that would allow an individual to work for three months without a regular stream of income. In regular circumstances, different advice is offered to companies. Companies run at a negative cash flow during the embryonic and build phases of life. Constant reinvestment and concentration on growth means building this cash reserve is extremely difficult.
However, when the dust has settled and the true economic impacts of COVID-19 are revealed, businesses without a cash reserve will be at a significant disadvantage to those that do. When businesses begin their rebuilding process, a cash reserve will be necessary to begin inward investment and continue growth again.
We advise taking the approach normally reserved for individuals. Analyse your businesses spending and identify the areas that are unnecessary during the pandemic. This emergency cash reserve will put you in a much better position than your competitors.
- Employees and duty of care
Your duty of care towards your employees should be among the most important aspects of the new plan. The COVID-19 pandemic will affect businesses in every aspect. New hires or potential candidates will be interested to know how you reacted to the pandemic and how you treated your employees throughout the crisis. How you reacted to the current crisis and how you might react in future is likely to be a determining factor for those considering being part of your team. This concern may also be shared with potential investors, partners and other stakeholders who would like to know whether or not you can handle adversity.
A strong positive message about your plans to deal with this type of situation will communicate reassurance to your clients, partners and employees. Communication is absolutely key. This will allow you to attract and retain business, and it may even become a key part of a tender process in your insurance provider selection.
- Employee benefits and your employee benefits strategy
Your catastrophe limits will be important in an instance like COVID-19 and may need to be reviewed.
For the majority of businesses, the “actively at work” definition might tighten. Businesses will also need to be mindful of the stress their employees may be under when adapting their actively at work policy. Remote working will also need to be taken into consideration. Unprecedented times require unprecedented employee flexibility. This will have an overall impact on your employee benefits strategy. Benefits that help employees during a crisis will become more and more important. For example, EAP benefits may become more important now than ever. Death causes in insurance may also be impacted to exclude or limit instances associated with these types of events.
Key questions
Finally, when looking after your employees, ask yourself, can your business answer the following key questions:
- Do you know where all of your employees are at any one time?
- Who is travelling on business?
- Where are they traveling to?
- Does your company travel insurance cover sufficiently?
- How do you communicate emergencies with employees who are away from the main office?
- If an employee is on holiday do you know where they are?
- Do you know which employees are business-critical?
- How do you measure employee productivity to know who is business-critical during a crisis?
- Do you provide access to adequate medical insurance when an employee is travelling?
- Do you have an emergency repatriation policy?
- Do you have a kidnap and ransom policy or support?
- Have you put in place event triggers for actions to recall employees?
- Do you know what employee benefits could provide support to employees before, during or after an event?
- What are the catastrophe limits on your policies and does this leave you exposed?
- Do you have adequate systems in place to manage employees should a manager be impacted?
- Do you have a business intelligence tool that can help with touch of the button data and reporting on spending related to employees?
Neil Fallon is COO and CO-Founder of Eppione, a specialist software company designed to help employers with HRIS, Employee Benefits and Insurance in one state of the art platform solution. Neil is a qualified financial adviser and has worked in the employee benefits technology space for almost 30 years.