Unlike the giant corporates, SMEs have highly limited resources. Due to this, little hiccups in the economy can leave a massive dent on the well-being of a small business. However, with proper planning, SMEs can save themselves in the ever-changing business environment and keep afloat.
One significant change, or rather a challenge that every business in the world is facing right now, is the spread of COVID-19. The pandemic has forced the nations to put their countries on a lockdown, stop the businesses, and stay indoors while the medics try to find a cure. It is almost sure that the world economy is entering a state of enormous depression. What is more concerning is the uncertainty in policies and practices in the coming years!
When would the businesses be able to open and normalize?
When would the world economy return to its brighter days?
Is this the end of several things that humankind has achieved?
Will the small businesses be able to bounce back?
Will there be enough funding available?
Will the Government continue to support the business, like pre-pandemic time?
The situation in Singapore is going to be different from the rest of the world because of one primary reason – SMEs fuel the economy of Singapore. 99% of the companies in Singapore are small and medium enterprises. These companies employ 72% of the country’s working population and make up for almost half of the Singaporean economy by revenue. Singapore has been able to control the spread of coronavirus and skip the country-wide quarantine mode like UK, Italy, Spain, India, or the USA. However, it does not mean that businesses can relax and work like normal. It should be a wakeup call for the SME sector to create an exigency plan and get ready to venture into a highly volatile future.
How to Start?
The first step towards building an emergency plan is to realize the assets that are critical for the business. A company’s critical assets fall under six categories:
- Liquidity and other funds
The critical assets are essential for the business because they create the product, add value to it, market it, sell it, and realize a profit from it.
Additionally, the businesses should also account for the operational risks and risks from governmental policies and regulations. A recent example of the risk associated with a change in regulatory policy was the ban on e-scooters in Singapore in 2019. This change by the Government forced several small businesses and their stakeholders to come up with alternate plans.
A business continuity plan for an SME focuses on the efficient allocation and usage of the critical assets during the time of emergency. The plan enlists:
- Essential tasks to get executed during the crisis, along with the sequence of execution and details of people responsible for carrying out the plans
- People that have to be informed when emergency strikes.
- Duties and responsibilities of key players of the business
- Contact information of key assets and addresses of equipment and building that may be at danger and a plan on how to protect them.
- Details on the source of funds, how to procure and utilize them for the best outcome
The Next Steps to be Taken
Once a business has a plan in place to deploy its critical assets most effectively during a crisis, it’s time to focus on other aspects of the business continuity plan.
The Government has been able to protect the country from Coronavirus ‘as of now’. However, this does not form a guarantee that a crisis will never strike the country in the future. Singapore start-ups can learn from the experience of others around the world and take measures right now to ensure a safer future.
Maintain a crisis fund
Many companies around the world asked to shut down their premises. As a result, people have started losing their jobs. For instance, restaurants in the UK had to let people go since they are practically out of business for the time being. The fear now looms over millions of jobs that could get lost due to the impact of coronavirus in the coming weeks. A crisis fund in such a situation can help a business in supporting their employees for a month or two. Moreover, crisis funds can also help a business in making specialized arrangements for the workers when required. It will build trust, security, and loyalty towards the company among its employees.
Build Technical Capabilities
Many companies in India faced technical difficulties when they were forced to enable work from home capabilities overnight to support the businesses. The companies who had built such abilities earlier were fine with the idea. However, the ones that had never prepared for such adverse situation either enabled the work from home facility for their workers on unsecured network protocols or did not enable them at all. The most affected were the companies active in the manufacturing and construction business.
Companies can look towards leveraging technology to create virtual workspaces right form day 0. It will not just facilitate smooth operations during the time of crisis, but it will also help companies in providing flexibility with work setup regularly.
Get Insurance Cover
Insurance plays an important role when a hazard leads to the destruction of buildings and equipment. Insurance can help a business in reclaiming a significant part of the investment at a nominal annual premium. A review of all the critical assets at the risk of destruction can help in determining the things that need to be insured, and therefore, the total cost of insurance.
Insurance can also protect the interest of the company by providing financial cover over the damages done to the Government, other entities, or the environment due to employee’s or employer’s negligence. Additionally, Singapore requires the companies to purchase work injury compensation insurance for employees as compliance under the Work Injury Compensation Act (WICA).
Segregation of Duties
Sometimes, confusion can do more damage than the crisis itself. Therefore, companies need to assign roles and responsibilities to their employees very clearly. Everyone should be aware of what is required of them, how to achieve it, and when to achieve it. Set up a team of:
- Public relations, who will furnish statements to the Government and the press when required.
- Core team who will dedicatedly work on protecting and deploying critical assets to enforce business continuity
- Team will also be responsible for maintaining a clear line of commands
- Multiple small teams that focus on completing the assignments and keeping the work modules alive.
Test and Improve the Plan
Creating a plan and no testing is as functional as not having the plan at all. It is advisable to practice and test the plan on a typical workweek to understand the hiccups and challenges faced during the execution of the plan. The dry runs will provide enough data required to analyze and understand the problems and find the best solutions.
If testing is not possible, companies can opt for walkthrough exercises, wherein everybody is involved and told about their responsibilities. The walkthroughs will enable the stakeholders of the company to understand their role, responsibilities, and expected outcome clearly.
Time to Prepare for the Crisis – Better Late than Never
Thanks to the pro-active measures taken by the Government of Singapore, the country has survived the pandemic in a commendable fashion. On the one hand, where the developed nations have succumbed to the spread of coronavirus, Singaporean businesses are working as usual as it can be in this pandemic situation. However, the government process of implementing policies and regulations to achieve complete normalcy at earliest possible is quite remarkable and appreciated.
However, this should be taken as a lesson rather than a relief. The businesses must start thinking about disaster recovery plans and business continuity plans on a personal level. The pandemic is not over; the world is still under stress, there are chances of Singapore getting further infected, even if remote.
Get started with business continuity and risk mitigation plan, as NOW is the right time. The businesses in Singapore have the time and resources required to create a practical and comprehensive rulebook to guide all of its employees in the time of crisis. Do not depend on the Government for everything. It can only do enough to safeguard the nation as a whole and not focus on fulfilling the needs of the businesses alone.