RESURGENT INDIA KNOWLEDGE SERIES PRESENTS
Webinar on “Life of Corporates after COVID-19
Speakers: Mr. Samir Gupta, CMD- Jackson Group
Speakers: Mr. Lalit Agarwal, CMD- V mart Retail Limited
Moderated by - Mr. Jyoti Prakash Gadia, MD-Resurgent India Limited
⇒Conventional definitions of classifying companies into small, mid, and corporate based on their size, profits, and plant and machinery will now be replaced by modern definitions of how effectively they are using the internet for connectivity, communication, and reaching out to the customers. The new classification will be named as follows.
⇒ Offline- Rural business with no internet and old-school operations
⇒ Connected- Use the internet for general information but no utilization for business activities. 30-35% of businesses may fall under this category
⇒ Enabled- Has internet set up, uses connectivity for internal communication and understands customer database.
⇒ Engaged- E-commerce businesses.
⇒ Old school management style based on decentralization will be transformed and a new style of management will be followed by most of the companies. Direct flow of information and order from top management to executives with no interfering flab of middle-level management.
⇒ Modern-day needs of customers for customization will take a charge over the concept of economies of scale.
⇒ The crisis has led to some important revelations for the number of businesses and corporates and forcing them to re-evaluate the importance of online presence, Disaster management, Work from home culture, Risk management strategies, Managing liquidity, and cash flow, Technology adaptation.
⇒ Consequences of earlier crisis and recent ones are almost similar i.e. falling of stock markets by 30-35% but the challenges faced are very unusual. There was a gradual fall in the demand for commodities and capital markets in the earlier crisis over a period of two years whereas there is a steep decline in recent crises just within 30 days’ time.
⇒ Never seen before, apocalyptic like situation. A lot of fear pandering which is giving rise to increasing insecurity, hostility, and anger.
⇒ No amount of management class or disaster management class could have taught to tackle this crisis. The application of management tactics with agility is of more importance.
⇒ Non-grocery retail businesses highly impacted after the aviation and hospitality industries.
⇒ Businesses survive on the ecosystem of values. It’s important to have clarity on what’s the ultimate objective of the business activity. Is it for larger interest, community or fulfill self-need?
⇒ Business models should be sustainable, focus to achieve long term goals rather than get distracted by greed or getting short term profits at the cost of your values/principles. The demonstration of values in your business activities motivates people to work with you to follow those ideas.
⇒ Although there will be many companies that might go out of business, this pandemic may have opened up an array of conversations, carved a learning curve, and unleashed myriad of opportunities.
⇒ Prudence is one of the core values to possess in the retail business.
⇒ The organization culture is developed when your business processes, activities, and related stakeholders are all aligned to the purpose and core value of the entity. It’s then safe to say that the company is generating something of value to society.
⇒ Effective communication between the stakeholders involves the realization of the fact that everyone associated with the organization is one and working towards the mutual benefit and is res. In terms of communication channels, we are very well equipped digitally. Great opportunity for the leaders of organizations to practice effective communication with their employees, highlighting intention and drawing attention away from the pessimism.
⇒ Exercise openness, frankness, and transparency. Do not pull curtains on bad news. Everyone at this moment is working towards mutual benefit. Increase engagement limits and take feedbacks. There is an incomplete communication if the opposite party fails to understand your objective. Communication can be translated through body language, writing, facial expressions, etc.
⇒ Looking at China, even after their factories resuming, things are going at a slow pace because of reduced global demand. India might face similar issues especially MSMEs. People may be skeptical about burning cash.
⇒ Industries' single-point agenda should be conserving resources which not only includes cash but also power, water. A number of western countries are facing a water crisis as a result of this virus. There are going to be salary- cuts or postponement of bonuses for white-collared jobs. It will take nothing short of 6 months to a year for things to return to normalcy.
⇒ Retail Businesses usually plan ahead and forecast their operation in advance. Right now that planning and forecast have come to a halt. Businesses should prepare their supply chain to act with agility as soon as this debacle starts to fade. Integrate all the ecosystem and have consistent communication with its suppliers to ensure that they are ready and also comfort them they are not financially deprived of that capability.
⇒ Transformation of manufacturing processes is not going to happen overnight but it’s going to change. There will be diversity in the supply chain. Local sources will be in demand. There is going to be disruption in 3-D Printing.
⇒ Huge focus on lean manufacturing, lean offices, sustainability, minimize environmental damage. Global collaborations and partnerships will be running at the forefront.
⇒ Every crisis is an opportunity in disguise. Climate change is positively impacted. Work from home culture and flexible hours will be new normal which will increase productivity in the long term.
⇒ We are experiencing an era of cautious optimism. The investment plans for expansion, M&As of the organization will take a pause and get delayed in short term but will not be canceled and bounce back.
⇒ Investors in the retail chain of businesses are for the long term. Long term investors are not affected by external factors as long as they have faith in the strong internal system of operations for revival. The leader of the organization has to show investors the opportunities that can be built and display confidence. Investors have been more burned out by the situation in western countries due to pandemic than India.
⇒ People in business use to sit on high fixed costs and low variable costs. Because of the crisis, we may see the inversion of the structure with a low fixed cost and high variable cost.
⇒ The current situation will enable a lot of leaders introspectively to make robust changes in the organization’s operations, digital adaptation, updating the creative side of the business, hone various capabilities that were overlooked due to time constraints which will strengthen the company for future prospects.
⇒ Tech and IT sectors will perform positively. The government will come out with lots of policies to promote component manufacturing. We are dependent on China for component manufacturing. The Pharma sector is also one of the sectors that may see commendable growth. Lots of investment will be directed into pharma for R&D of vaccines, medication, etc. Consumer durables will continue to grow. Agro-processing is also one of the areas that may witness substantial development and excellent opportunities.
⇒ Infrastructure like cement and steel will also behave positively due to the continued interest of foreign investors to invest in the Indian market, the government will concentrate on the development of infrastructure. FMCG, Retail- online and offline will also have a bright future post-COVID-19. Retail online presence has been growing but will tremendously grow even more because of cynicism revolving around physical shopping.
⇒ Consumer behavior for retail will be divided. Urban vs Rural and Tier 1 vs Tier2. People who are more aware and educated of the situation are dealing it with skepticism as compared to unorganized labor. People in smaller towns are assumed to be having stronger immunity against fear and negativity.
⇒ The government should strive to bring down the cost of finance and make India globally competitive by this move. It should aim at the fundamental renovation of broadly five things to get India to take advantage of this opportunity. It includes the cost of finance, infrastructure, skilling of labor, and the judiciary.
⇒ Reinventing and rediscovering multiple areas of the organization is what most companies are engaging in. Noting down areas of improvement, revamping, and strengthening the digital and IT domain of the company. Take deep dives retrospectively and shine a light on past mistakes and strategizing for future developments.
►Watch the webinar on YouTube: https://www.youtube.com/watch?v=LnAqf288jwQ