Let's start at the top: Take care of your people. Around the world, that’s everyone’s first duty—to themselves, their loved ones, their friends and neighbors. For millions of brave healthcare workers and others, it means caring directly for those who are sick.
If you’re a CEO, taking care of people also means taking care of your employees and customers. This crisis brings into sharp relief that it's the efforts of employees and the loyalty of customers that will see a company through these extraordinary times. The job of the CEO, simply, is to do everything possible to make sure they’re taken care of.
That principle is the first of the priorities in the CEO action plan we lay out below, but it’s woven throughout the other priorities as well. Of course, any CEO must consider what’s happening to revenues right now. Our prescription, though, goes back to people. The best way to take care of revenues now is to focus on their ultimate source. Do what’s needed to build trust and loyalty with your customers now, and that loyalty will survive beyond this crisis. Remember, there will be a beyond.
Finally, this crisis will change us all. It’s hard to step back right now, but as CEO, carve out time to think about what the future will look like, how employees and customers will be changed by this crisis, and what your company will need to do to meet their new needs.
- The process of containment and slowing the spread of Covid-19 in each country will create major disruption in itself, irrespective of the seriousness of the virus spread itself
- Prepare for the worst, and be thankful if it doesn’t happen; a wait-and-see approach is a nonstarter
- There's a high likelihood of a substantial revenue disruption, leading to a potential liquidity crisis for many businesses
- The recovery may not be a quick bounce-back; plan for multiple quarters of lower revenue
- Employees and customers are probably experiencing fear or panic
- You need to appoint a senior, fully dedicated Covid-19 war room team focused on this all day, every day
- As CEO, you must be out in front with a planned cascade of possible actions, probably more aggressive than your team can imagine right now
- Customers will change some behaviors permanently, accelerating prior trends; bold action now can set you up for success through the downturn and beyond
Actions to take now
There are several moves that CEOs can take right now to help mitigate the effects of the outbreak and come through stronger on the other side.
As the economic fallout continues, business leaders will want to first model their exposure to the coronavirus fallout and street test their P&L and liquidity. There will be critical “triggers” where more aggressive actions will be needed (see figure below).
We recommend immediately launching three actions simultaneously:
Align your senior team with a wake-up call
- Get the full team aligned with the true severity of the macro Covid-19 situation and worst-case financial scenarios
- Set safety as the No. 1 priority...
- … and cash conservation and liquidity a close No. 2.
- Avoid inaction; “wait and see” could damage the company
Establish a dedicated senior team in a war-room setting
- Set up a senior, dedicated team from multiple disciplines (ops, sales, HR, finance)
- Prioritize and put major work streams into action; set a tone of daily progress using Agile approach
- Break the usual reporting and update cycles; urgency requires a different model, such as daily informal CEO updates
- Put a tracking tool in place
Outline macro scenarios and translate to contingency plans
- Outline specific macro Covid-19 scenarios, by major geographies
- Translate those scenarios into tangible revenue-decline and operational-disruption scenarios
- Begin to outline no-regret moves—there will be an impact; start acting
- This needs to be done in days, not weeks (and you can continue to iterate)
Map out a war-room plan
After getting started, set up a plan for at least 6 weeks out, broken out into stages.
Tom Holland is a Bain & Company partner with the Bain Accelerated Transformation business and is based in San Francisco. Simon Henderson is global leader of Bain Accelerated Transformation and is based in the firm’s Sydney office. David Schannon is a partner with the Performance Improvement practice and is based in Bain’s Silicon Valley office. Hernan Saenz leads the Global Performance Improvement practice and is based in the firm's Dallas office.