Niranjan Gidwani, independent consultant, director and former CEO of the Eros group discusses major concerns faced by businesses since COVID but his biggest worry is that companies should not start offering shoddy services and poor quality products in the name of COVID
The Coronavirus pandemic has been a serious health and economic problem across the world. Barring a very few above the age of 100, none of us who are alive today have seen the likes of this problem. Hence it is but natural that at all levels, decision-making has become even more of a trial and error approach.
However, the big worry is that we may end up accepting laxity and low quality results as the norm. Because this is a pandemic of global proportions, as consumers, we remind ourselves that we must be patient as we believe that companies and organisations are trying hard and must be doing their best. And then when we start to look deeper, we realise that several companies, organisations, stores, online delivery platforms are not exactly doing their best. There seems to be an undercurrent where delays, poor service, inability to make legitimate payments, sacking of employees, are all being put down to the coronavirus.
The first area which has literally fallen off the cliff is cutting of employees. Even relatively stable organisations, who may end up making less for a year or more, after having decades of a good run, are firing employees lock, stock and barrel. At the same time, at a more holistic level, the same organisations are waiting for demand of products, services, commodities to pick up. The question is how, when the two philosophies are working at cross purposes. Yet, there are a few really ethical pearls clearly visible. I have a friend of mine, who is CFO for a large local group. When the senior management proposed reduction in salary, cutting employee numbers, the elderly owner thought about it for a few days and ordered that there will be no cost cuts, no employee reductions.
He clearly stated that a large number who are working in his organisation helped him when things were rough with his business. This was his time to reciprocate and to show his commitment to those who stood by him in his difficult days. Such gems also exist. Same is the case of a huge retailing giant who, upon realising that brick and mortar retail slumped badly during the lockdown, shifted a few thousand of their employees to assist in speeding up their online business model. And succeeded very well. Yet another gem.
Another area which has literally fallen of the cliff is online deliveries and promised schedules. I have seen my wife ordering various items from one or two prestigious online retailers. Interestingly, for the entire last few months, whatever is ordered in one single bill, without fail, the material is delivered in three, sometimes four lots, at all odd hours of the day, in unduly large packaging which must be costing a lot and also causing huge environmental problems. On several occasions, the retailer misses out delivering some items due to non-availability of stocks, but the money has already been credited to the retailer’s account. Then starts the process of how to get the refund back, or get something totally unwanted in exchange.
Receivables is another thorny issue. Rich and influential organisations, very well to do individuals are using this pandemic as an excuse to either delay payments, or shave off large amounts for no reason. The result is that lawyers, courts, arbitration processes are overburdened unnecessarily. And most of them still working mostly online.
Another thorny area is the manner in which employees who are asked to exit are handled. All good organisations need to be congnisant of the fact that dealing well with employees who exit, and maintaining their honor and dignity is an attribute which needs to be ingrained in the dna of every good, futuristic thinking organisation. This reaps huge intangible rewards for the future, especially when some of the same employees may be required back as things improve.
Covid need not be used as an excuse to write off all the successes of this phenomenal country whose rulers have taken decades to create such a globally iconic brand.
Some rationalisation of budgets is absolutely essential. The focus must absolutely increase on cutting costs when demand is likely to take a long time to build up. But what we see in many cases is a serious reduction in the quality of services, thereby deteriorating the organisation as an asset.
We are seeing this not only in the traditional trading and distribution businesses, but also in the real estate side of the business. Reductions in real estate prices tend to squeeze developer margins. This leads to a new cycle of renegotiation of contracts. This starts cascading downstream, often compromising the quality of the asset. Sadly, when problems do arise sometime in the future, a chunk of current decision makers would have exited the system, leaving the issues with the newer generation, who may be ill experienced to manage the complexities.
Dubai, UAE and its businesses have faced challenges in the past, and each time there has been an adjustment period, after which a good period of growth has followed. This has always been the hallmark of this city and the UAE. A quality of bouncing back, no matter what. It is extremely important to realise that, as the business community collectively faces the longest and harshest phase of health and business problems, enough care is taken by all the stakeholders to ensure that the binding glue used is strong enough to wait out this period and to take us to a higher level of professional and personal success in the period which is sure to follow.
The question then is – are we all putting our best foot forward? It is quite visible that the crisis has definitely brought out the best in some. It is equally visible that, for quite a few, whether the covid has affected body health or no, it seems to have affected decision making health in several ways.
Some food for thought.