The coronavirus epidemic is testing critical internal business processes, including payroll, accounts receivable and accounts payable. For many, it is also bringing much of normal business activity to a standstill. Whilst there is often opportunity in change, can a silver lining be found in this very dark cloud? One ‘gift’ from a sharp reduction of business activity is a small window of time where business leaders will be able to review the effectiveness of critical internal processes and build a new strategy for evolving them.
The scale of impact of the coronavirus epidemic is unprecedented in peacetime and the UK government has had to make enormous new policy decisions. With the budget only a week ago, government spending plans have already gone out the window and we are receiving new budget updates on a near daily basis. The pace of policymaking is reflective of the dramatic impact that the threat of coronavirus is having on the UK population as a whole – on families, employees and particularly on businesses. Whilst the Government is promising to step in and do ‘whatever it takes’ to support businesses through this crisis and avoid mass unemployment, the detail of this support isn’t yet known and businesses are already making tough capacity decisions.
We are seeing manufacturing businesses scaling back or indeed halting production in their manufacturing sites. Sometimes because of changes in demand, shortages in essential raw materials and supplies or sometimes because of a sharp reduction in their available workforce as travel is impacted, school closures are announced and employees follow government advice to self-isolate.
Self-isolation amongst the workforce has also impacted the service sector, with the rapid transition to working from home exposing the fragility of many business processes.
Many businesses have closed their central offices and moved to remote working to limit the potential impact of coronavirus on their key functional teams, such as payroll processing, accounts payable and accounts receivable.
The current expectations are that this crisis, although temporary, may continue for the next 10 to 12 weeks. It is in the context of this duration that Unipart think that businesses should consider using the economic slowdown to rethink how their critical internal processes are designed and delivered.
We recommend setting aside some leadership capacity to capture and analyse the effectiveness of the transition to remote working. The enforced social distancing of functional teams then becomes an opportunity to reflect on how these critical processes and the organisational design of the teams delivering these processes could evolve. In this way, businesses can learn what works for them and also what doesn’t, thereby providing a template for new improved business processes when the crisis abates. The challenge will then be one of regaining momentum and returning to effective working while we exit period of volatility and global rebalancing.
Unipart Expert Practices is the consulting brand of Unipart Logistics and provides business consulting services aimed at driving Operational Excellence across our client base. For more information please contact us on the form below, or via our contact us page.