2020 has been quite a ride. We started the year with an optimistic outlook for the economy, but everything changed in a matter of days. The sudden onset of the pandemic and its severe impact on the economy were jarring, to say the least.
Given the nature of our business, we had a front row seat to see how businesses across our region navigated the rapidly changing environment. Additionally, we worked hand-in-hand with clients as they scrambled to quickly develop and implement contingency plans that included layoffs, furloughs, and outright closures. Many management teams based these plans on the worst-case scenarios that they thought would become reality, because they simply had no basis to conclude otherwise.
The good news is that only a few weeks into the crisis, most of our clients found their footing and adapted to a new normal. Additionally, federal assistance under the Paycheck Protection Program (PPP) provided much-need financing during the roughest part of the pandemic. Now that we are seven months into the pandemic, many companies are performing well, with some even posting record results. In light of that rebound, we would all be justified in taking a moment to pause and catch our breath, but now is not the time to get complacent.
The reality is that while nobody knows how the pandemic will play out over the next few months, we do know that current cases are already well above where they were in March and April. We also know that many scientists are predicting a surge in cases during the fall and winter. If they are right, will governors implement new regional lockdowns or closures? Will Congress come through with another round of PPP funding? Will companies experience outbreaks in their workforces that affect their ability to operate?
Those are big questions, and creating plans based on an optimistic outlook might very well risk the future of your company. While you may not know the answers to these questions, you now have two things you did not have in March: an understanding of how the first wave affected your business (including your customers, suppliers, and employees), and some lead time during which you can develop contingency plans.
Now is the time to develop those plans in detail so that management is ready to act quickly based on predefined triggers. Having well-defined plans will also provide a sense of calm if the environment deteriorates so that management can make better, more rational decisions, which was particularly difficult during the first wave.
If we are all lucky, most of these plans will just sit on a shelf until they are uncovered by an archeologist a few thousand years from now. But if it turns out that we are not that lucky, those plans may help you survive a new wave and be better prepared to thrive once it passes.
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