Managing Change in Asia

Lessons learned from Asia: On the path to recovery

Lessons learned from Asia and how to get prepared for the return to work. By St John. Cameron, MD Asia, Proudfoot

When the World Health Organization declared COVID-19 a pandemic, most nations were forced into shutdown as people around the world had to isolate to stop the virus spread. The world as we knew it, changed. Now, however, it calls for recovery.

COVID-19 has pushed millions of people into unemployment; it has brought whole industries to their knees and led global markets to hemorrhage trillions of dollars. The pandemic is said to be the worst economic downturn the world has seen since the 1929 Great Depression.

But as optimistic economic historians like to remind us, the period following a severe downturn is always one of growth and prosperity. In the early twentieth century, following the hardships of the war and depression, living standards improved and a new society confident of its future and place in the world emerged by carefully making strategic changes.

Recovery: Asia gets ready to return to work

Recovery. Learn more!

While it may be too early to call a return to normalcy, on April 6 the International Monetary Fund cited limited but encouraging signs of recovery in China. New daily cases are low, and Wuhan has officially reopened after months of lockdown. Travel restrictions have eased, and China has managed to get large parts of its economy up and running from the complete standstill it experienced in February 2020. According to official figures, industrial output was down by a less-than-expected 1.1 percent in March from a year earlier, signaling that factory activity was restarting faster than initially anticipated.

Most analysts agree that the March data shows China’s economy is past the worst. However, recovery will be slow as investors and consumers regain trust and get back to a semblance of normality when it comes to consumption. But as AxiCorp’s Asia Pacific market strategist Stephen Innes has put it, “The lights are back on, and people are working… so in the end consumption will recover.”

And in North Asia, countries that followed strict enforcement regimes and adopted social distancing early, have seen new cases drop to single figures like China. With enhanced monitoring and track and trace technologies being rolled-out, countries such as Hong Kong, Macau, Taiwan, and South Korea are now gearing up to restart their economies.

Recovery: Lessons learned from Asia

As more economies across Asia and other parts of the world gradually move towards reopening, business leaders must now think about what the future holds to obtain recovery. The return is a critical business event; leaders at all levels must plan for it if they wish to find themselves at a strategic advantage and want to thrive in what will be a completely new business environment.

It is a given that business practices will change. As Ariana Huffington recently wrote about the pandemic, “Nothing should go back to normal. If we go back to the way things were, we will have lost the lesson.”

So, how do leaders prepare for recovery and return to work following the COVID-19 crisis and manage a new future and way of doing things? Here is our 5-step plan:

1. Determine what will change and what will stay the same in the new world

Some things will change a lot, some will change slightly, but whatever you do, don’t stay the same. Use this opportunity to get ahead by driving change. Start by Aerial Mapping. Map out jobs, tasks and processes that you know have changed. Challenge any default assumptions and be willing to experiment. Analyze what has and hasn’t worked during lock-down. Think about what can be improved for the longer-term benefit of the business.

For the processes that you think need to remain the same, you will still most probably need to change how certain things get done in order to comply with new social distancing rules. You will need to adapt the everyday workplace to keep your staff and clients safe. This is the time to prepare by revisiting the flow of work, the materials you may need to keep business functioning and any new standard operating procedures that might be required.

An example of this can be found in supermarkets where cashiers and customers are now separated by a clear plastic partition; or at Honeywell Aerospace’s Malaysian manufacturing operations for example, work from home practices have been implemented to minimize workplace exposure. But manufacturing facilities have also remained open with enhanced site cleaning, strict physical distancing and use of PPE. Standard processes have been modified to ensure both staff safety and that customers’ needs are still being met.

2. Define what the first 100-days looks like

A 100-day plan will help leaders to focus people on a new way of doing things post the COVID-19 period. For example, in your maintenance unit, what does it mean to have production run at 75 percent capacity on a particular date? Or how can output be maintained with employee work arrangements transitioning from home back into the workplace at the 10, 25, or 60-day mark?

A 100-day plan should contain clear goals and targets, relevant metrics and indicators and review measures. For example, what are the dates when sales targets are ramped up in line with customer demand returning to normal? As part of your plan:

  • Be present. Stay in touch with your business’s community with clear, transparent and accurate communications, especially for those directly affected.
  • Review internal processes. Now is the perfect time to improve your processes, iron out the inefficiencies and eliminate any waste that might exist. Take the opportunity to implement positive change and transformation.
  • Define a new operating model. Inevitably things have changed at some level, even if that’s minimal. What is the new way of doing things to comply with government rules, keep production going, maintain the safety of staff, improve internal health and safety regulation, and provide extraordinary customer service to clients all at the same time. What are the main inputs needed, what are the business requirements and resources needed to move forward?

3. Have a robust communications plan that connects employees to purpose and builds trust

When a crisis occurs, a workplace can quickly become chaotic.COVID-19 hasn’t been just a mini crisis – it has been an unprecedented event at a scale hard to fathom. An event that so many were unprepared for. Leaders aren’t immune from this. They have had to move at lightning speed to determine the best communication response during the crisis.  And now leaders need to build trust for the next phase of communications and practice being transparent, accurate, and consistent. A solid communications plan helps you to avoid the spread of misinformation, and it also helps to ensure continuous productivity, allowing people to trust in the business and feel connected to the company vision and purpose.

People want to know what’s going on in this new post-COVID world. It is vital for business leaders to consistently communicate both good and bad news, and avoid unrealistic promises around what the post-COVID recovery look likes. Nurturing a sense of trust through open and honest communications will aid recovery efforts and create a sense of community.

Asian businesses offer many great examples of strong communications plans that have successfully push not only recovery, but also trust during the pandemic. For example, Master Kong, a Chinese noodle producer, quickly refocused on e-commerce, smaller stores, and digitization while reviewing the supply-and-demand planning on a daily basis. By doing so, and communicating strongly, they strengthened trust through their entire supply chain.

4. Create a localization strategy supported by operational agility

Inevitably, global and regional COVID-19 cross border movement restrictions will remain in place or be flexibly managed for months to come. The challenge is how quickly and effectively can you adjust to a new way of working. How do you win and retain clients outside your region? How do you ensure sustainable supply of critical material and skilled resources where they are needed to generate revenue? How do you generate revenue from resource pools now held indefinitely in certain locations?

New communication tools such as Zoom and Teams, and collaborative remote working platforms will definitely be needed to make the above scenarios feasible. More critical for the long term will be strategic changes to sourcing policies and local delivery partnerships to bridge boundaries and resourcing gaps.

Research has shown how the emergence of state-developed special industrial zones, such as those in China, Indonesia, Johor Bahru in Malaysia, and Gujarat and Uttarakhand in India, coupled with locally available raw materials and skilled manpower, have put certain Asian markets in a better position to support operational agility through the nearshoring of manufacturing.

Companies in all industries, should begin to analyze their supply chain risk management strategy and the weaknesses that were presented during the crisis.  Most critically and importantly, as economies begin to open up but borders continue to be on lockdown, there is an important focus on repatriation of sourcing materials.  For this, companies can benefit from artificial intelligence tools, supported by a robust supply chain management system in the procurement office, to source hundreds of previously unknown vendors, reduce cost and secure a stable and local supply chain.

When trade disruptions inevitably occur in the future, some manufacturers will always fall into a defensive strategy to absorb the impact. But those that have invested in a more advanced sourcing strategy and procurement infrastructure will have a far better set of options to choose from. They will also have far more operational agility to pivot without losing momentum, allowing them to outpace less agile competitors.

5. Redefine your Business Continuity Planning (BCP) strategy to navigate future crises

The Coronavirus pandemic, like every crisis, is unfolding with a beginning, a middle and hopefully an end. It is useful to think of where we have come from, where are we are now, and where we would like to be in the future. As this future unfolds, some organizations will be resilient. For others, it will be catastrophic. The actions of leaders in the mid of this crisis, will significantly determine their fate.

RMA Group is an automotive company in Bangkok. It already had a BCP ready for a black swan event such as COVID-19. CIO Alex Konnaris says “Over the years we have experienced a number of situations where staff have needed to work remotely and, combined with our long-term strategy for digital transformation, we have migrated a number of critical systems to the cloud and adapted our internet connectivity. RMA Group’s BCP has helped their business navigate the crisis: “We are also gaining benefits from cloud services which provide additional security and monitoring features that boost confidence to an operating mobile workforce.”

Your business’s future BCP strategy will ultimately look different based on your experiences this time around. Capitalize on the learnings from this black swan event and update your BCP with learnings from the last few weeks and months to make your business more robust. Allow it to guide the blueprint for fast recovery; one that includes the safety of your employees, undisputed excellent service to your clients, a strong and resilient supply chain, and a cash release plan.

Recovery: The message is clear, “be ready!”

As with any crisis, it can be difficult to turn your mind to what needs to be done when the acute phase is over. Most leaders are focused on the now and adopt a paternalistic approach wanting to shield their people from the truth. However, if we look to businesses in Asia, where in recovery process, communications have built trust, technology has been leveraged, business continuity plans have been prepared ahead of time and operational agility has been aided by localization strategies, we can gain valuable insights into how to approach the return to work.

As Chinese military strategist and philosopher Sun Tzu opined in the Fifth Century BC, “within crisis are the seeds of opportunity”. While it has been a disaster for so many, the COVID-19 pandemic has the potential to create great opportunities for those who are prepared.

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