The rapid spread of anti-corona virus measures around the world has already had a significant effect on the ability of businesses to continue to function. The total effect varies significantly by industry and by country. Entertainment, hospitality and retail are struggling to survive, and many businesses will simply not make it. Companies in developed countries can expect a higher level of government support than will perhaps be available in South East Asia.
If ever there was a time for the Stockdale Paradox, it is probably now. This requires an organization to assess its current situation and plan to tackle head on all the challenges that its faces. It enforces the idea that you can confront the most brutal reality of your current situation while at the same time remaining positive and believing that you will overcome all the difficulties ahead.
The first part is what turns people off, because it can be taken as negative or overly pessimistic. The important thing, though, is that time and again it has been proved to work under the most difficult circumstances.
Such paradoxical thinking has been one of the defining philosophies for great leaders making it through hardship and reaching their goals.
Many businesses are now, therefore, contingency planning for an economic coma that could last till a tested vaccine is available and deployed. Experience tells us that although there are encouraging signs this could take until late 2021.
This would mean the need to survive for up to twenty months during a period of greatly reduced economic activity. A daunting prospect for every business.
This financial challenge requires that you have a clear understanding of your cash flows and that you can plan for every eventuality. Cash really is King.
It means converting fixed costs to variable costs, deferring payments, taking credit or loans where available, working with suppliers and customers and most importantly being open and honest with your teams.
PKF stands ready to assist in any way we can.
Examples of assistance currently being provided to our clients include:
- Outsourced and co-sourced accounting services
- CFO services especially where regional or international management is not able to visit Thailand
- Employee management, payroll and benefits advice and administration
- Budgeting and cash flow management
- Moving systems and servers to the cloud
- Enabling remote working
- Training staff to use the technologies that support out of the office working
- Tax modelling, compliance and structuring
- Eastern Seaboard support
- Moving to a paperless environment
- Online staff training programmes
It is an ill wind that blows no good and we all need to use this time to upskill our staff and adopt the new technologies which will position us for the return to the new normal.