Leadership Action Plan : Preparing for Tough Economic Times

Bain & Company released a great checklist for companies and executive teams to plan for weathering COVID-19. You can reference the actual article, but the format of the checklist is less than ideal. Had it not been shared directly from a trusted friend, I likely would have blown right past it.

This is not an attempt to plagiarize their ideas. Instead, I’m hoping to provide a more executable format so organizations actually benefit from the insights.

People

  • Implement the best-known guidelines available for both employees and customers; over-invest
  • Monitor global health guidelines and other companies—and continue to fine tune
  • Over-communicate with full transparency
  • Assist epidemic-limiting initiatives in any way possible

P&L (Profit and Loss)

  • Outline macro scenarios by market, translate into revenue-decline and P&L scenarios:
    • Units, revenue, costs
    • Capex (capital expenses), working capital, cash/liquidity
    • 13-week, four-quarter outlook
  • Build extreme downside scenarios; this has the potential to be a 100-year event
  • Outline major operational actions
    • Do-now hand-brake actions vs. do-later break-the-glass initiatives

Revenue

  • Take a customer-centric view; how will you build trust, loyalty and market share through and beyond this crisis?
  • Build specific revenue-mitigation actions for declines in core revenue streams
  • Pivot resources to pockets of current and future growth, online and beyond

Operations

  • Stabilize supply chains of physical goods from likely geographic and labor disruptions
    • Manufacturing, distribution, suppliers, suppliers to suppliers
  • Build contingency operational plans for all aspects of the business
    • Frontline facilities, costs, variable labor staffing
    • Cross-regional variations in utilization
    • HQ, IT

Costs

  • Spending hand brakes
    • Immediate actions (e.g., hiring freeze, opex, capex, working capital)
  • Set aggressive break-the-glass cost actions triggered by more extreme revenue scenarios
    • This is (may be) about saving the company—no ideas are too extreme
  • Medium term, outline a plan to lean out the cost structure for the future—more automated, more variable, more shock resistant

Offense

  • Define how you’ll outperform competitors and expand share through and beyond the crisis
    • M&A roadmap
    • Product/service/customer intimacy investments
  • Prepare for bounce-back and recovery
    • E.g., marketing investment, monitoring macro trends for “if, then” moves
  • Plan for and take advantage of a leapfrog change in customer behavior —especially digital

Checkout the original article: https://www.bain.com/insights/ceo-plan-for-coronavirus-actions-to-take-now/