Emerging from the pandemic: How small businesses can begin to recover
As small businesses plan strategies for reopening and recovery, the new business landscape offers little more than painful choices. Being shut down or running minimal operations may turn out to be less stressful than facing the challenges ahead—new rules for safe operation, huge debts, uncertain ability to retain a workforce, working productively with social distancing, data security and privacy concerns, disrupted supply chains and unknown demand.
All of the choices are made more painful because owners have to proceed with limited or nonexistent resources. An owner had nothing to do with the crisis, yet everything about how they do business has suddenly downshifted. Understandably, anxiety is rampant, and emotional responses range from fear to anger to bitterness and resentment. These reactions can be so all-consuming that they prevent owners from taking timely or effective action. They can also lead to impulsive, aggressive and ultimately self-defeating responses. For example, some owners may rush into action on their own. This bunker mentality disconnects them from employees, suppliers, customers and the community. As a result, they lose the trust of potential partners.
There’s an inter-dependency in the world of commerce that cannot be denied. For example, a small-business owner who has had several rent increases for their storefront and holds a newly signed lease is now facing new restrictions and competition that make the future questionable. They might be thinking that the answer lies in restructuring their lease and forgoing rent that was due over the time of the shutdown. This is only fair, the owner feels. The landlord, however, has their own family to support, and their income depends on the storefront rent to pay expenses. Same dilemma, different interests. Even if the landlord owns many properties, neither party is right or wrong or more or less deserving. How can problems like these be resolved?
Part of the answer lies in collaboration and empathy. In my own neighborhood I have seen several businesses take alternative paths that are leading to new success. One third-generation family business was an expansive, high-end and very traditional family restaurant that boasted white tablecloths and wonderful service. When it had to close due to the pandemic, the family owners got the staff together and asked for ideas. Thanks to this brainstorming, they re-emerged—with curbside service, of course, but also with new business ideas for community services. They tried out some of the new ideas and were so successful that the demand for their custom meals soon outstripped their ability to deliver. Their goal was clear and two-fold: to stay in business and employ their people. They scrapped tradition and uncovered a fountain of innovative business ideas. The community responded by seeking them out with their own ideas, and everyone felt that the crisis was shared.
In contrast, another owner had to furlough most of their staff. Instead of laying them off, they decided to manage costs by asking everyone to take a number of unpaid days off over the summer. But some staff felt that this would be just another form of layoff—restricted because the business took a government loan—and so they sued the owner. In this case, a lack of collaboration and empathy led to a bad result for all involved.
Most businesses are now facing a stark reality: Can they remain open, and if so, how can they operate under the new, restrictive conditions? Distancing and health regulations mean fewer customers and greater costs. It’s a difficult reality for business owners to deal with on both a practical and emotional level. Many of them feel that their limited choices do not seem fair. As is the case with other natural disasters, because the owners have not created the dilemma, they ask, “Why should my business that I worked to long and so hard to create suddenly face this burden?”
But while Covid-19 is a natural disaster, it is also a social and economic crisis that business owners do have some control over. They cannot change the situation, but they can choose their response. Owners may look to government to help them recover, feeling that this is fair and just. After all, they reason, everyone will benefit from a recovery, and conversely, if many businesses fail, everyone will experience pain.
Adding to the pain of the pandemic, there are new waves of social unrest, and some closed businesses are being threatened and looted. This has led to an intense societal debate on what measures can have the greatest impact and how we can best strengthen our social and economic fabric. But a negative environment of grievance and blame can impair constructive discussions.
Feeling aggrieved and finding a target to blame is a danger that can affect both individual owners and a whole community. Such feelings are destructive in that they can lead a person to feel that because they are aggrieved and blameless, they are owed priority for redress. An aggrieved person has tunnel vision for others. The business owner who says “I should not have to pay rent” is blind to the needs of the landlord. And the employer who says “I should not have to pay for so many staff” is blind to the pain and needs of those whom they employ. Blaming others may temporarily help you feel better, but if you turn off empathy and focus on your grievances and your own limited notions of what is fair, you may well be left behind.
A much more positive approach would be to look at those businesses that have successfully reopened and study how they responded to the crisis. It appears that their success stemmed from six actions, which you can follow in this order:
- Define your community. In response to the pandemic, people are forming “bubbles” of people whom they can safely interact with. A business owner needs two bubbles: Their primary bubble will consist of their core family, the business owners and perhaps some or all of their employees. A secondary, larger bubble can contain the owners and some employees, suppliers, customers and members of the local community. This is the community that shares concern for your business and can be a resource for your future. But it is also a responsibility for you. You cannot ignore their interests or needs, and you must keep them cognizant of your dilemmas.
- Develop a stewardship mindset. Watch your emotions and notice when they are tempting you to take impulsive or aggressive action. In such cases, stop yourself and ask what outcome you want to see and if these actions will help achieve this. Impulsive reactions usually backfire, leading to unexpected, negative consequences. Instead of succumbing to these impulses, you should step back and remember that everyone is struggling, you are not the only one. Your best path is one where others benefit as well. That is taking stewardship rather than grievance-based action.
- Clarify what you need to survive and recover. Look clearly at your needs and create one or several plans for recovery. This should be done with the collaboration of others within your primary and secondary bubbles. And in the process of defining your own needs, you must also reach out to learn what others need and want and consider how to share burdens and sacrifices. The goal is to have a limited, immediate plan as well as some more expansive options, all of which will be mutually beneficial.
- Communicate and share needs, progress and new wrinkles. The pandemic and social unrest are creating a new world in which uncertainty rules. This means that most plans and actions should be viewed as experiments; you are not sure what will happen. Innovation research talks about “rapid prototyping,” trying things out quickly and then assessing if they work. Seeing your plans as experiments means that you expect new challenges to emerge, and you will need to call your team together to reset. You will also quickly experience what works.
- Ask for help when needed. When things are tough, there are always members of a community who will rise up and help each other. They will hold rent parties, share food, and help those in need find shelter. In this mega-crisis, you cannot be shy about reaching out to others when you need help. If you do not share your problems, you may be facing a deep crisis that others know nothing about and thus may not be there for you.
- Share benefits and positive milestones. In some crises, when recovery begins to take shape, there can be hurt feelings and harsh judgments if milestones and rewards are not openly and fairly shared. Are the owners or leaders getting rewarded first and foremost after many people shared in the sacrifices made? If a company had reduced employees’ salaries or hours or asked for their help during the crisis, they should be ready to reward everyone once the business rebounds. And while symbolic rewards are fine, they should be accompanied with concrete, monetary rewards as well.
There is no magic way to come out of a disaster without pain. Things don’t always work out and are rarely experienced as fair. Owners of small businesses must acknowledge this and overcome negative emotional responses in order to find a collaborative and empathic path to recovery and emergence from this crisis.