Crisis management, transformation and communication issues
in the context of Covid-19

April 15th, 2020

The global health crisis we are currently experiencing tends to reshuffle certain cards in terms of communication and crisis management for French companies.

For almost a month now, companies have been facing challenges that were once minor but which are now taking on their full meaning: mainly health risks and the strengthening of safety policies to ensure business continuity. All this in a context where public opinion, the media and the companies themselves have put the courage and adaptability of their employees in the spotlight (particularly in mass distribution, logistics, essential industries, etc.) and also where the companies are facing economic difficulties despite the government’s introduction of social shock absorbers.  

Facing this situation, our clients are mainly questioning us on three aspects:

• How to communicate effectively on the respect of barrier gestures or on any other measures to be implemented to prevent the proliferation of Covid-19 within the company?
• How to value the women and men who every day go to work with a fear of being infected – and by extension their families – but who do so out of professional and civic commitment?
• In a context of strong economic difficulties, currently or in the future, how can we continue a manufacturing activity when rights of withdrawal arise on a massive scale?

Some good practices have emerged on these issues. For example, in the retail sector, faced with the dual challenge of ensuring the health and safety of their employees and customers, companies have been forced to react very quickly. From an operational point of view, the installation of protective screens, filtering at the entrance of shops or reinforced cleaning of trolleys, baskets or payment terminals did not entirely remove employees’ doubts. In response, the chains adapted the working hours of their employees, imposed a refilling of the shelves before the opening of the stores and praised the courage of the employees both internally and externally, as well as granting them a bonus of €1,000.

Despite the implementation of health policies, industrial companies are now facing the decision of employees to exercise a right of withdrawal when they cannot benefit from teleworking. On this point, feedback has shown that only companies which had chosen to negotiate with their CSE / Unions for short-time work and/or business continuity under certain conditions, before the first proven cases, succeeded in maintaining an activity. On the basis of weekly negotiations, the social partners re-evaluate the resuming of work.

Finally, for other businesses, business continuity has been achieved through the very rapid implementation of teleworking, even though many companies were in the early stages of implementing it. This crisis has been an opportunity to shorten the time for discussion and to launch this method concretely.

Finally, let’s try to forecast the post-crisis period and the impact that these new challenges will have in the field of business transformations, Oneida Group’s core business.

The end of the crisis raises more questions about the role that companies will have to play than clear answers. What seems certain is that there will be a demand for corporate “responsibility” from both public authorities and public opinion. In this context, “responsibility” means contributing to the modernization of public health infrastructure, rebuilding the economy and maintaining employment “whatever the cost”. Thus, there is no doubt that ethical charters and CSR will have to be given greater prominence in corporate strategy through, for example, the financing of public hospitals, commitment to the French sector or the preservation of the local ecosystem (subcontractors, suppliers, etc.).

The Covid-19 crisis will force companies to adapt in a very structuring way to new market conditions, which are inevitably disruptive, with risks of strong social impacts.

In the short-term, transformations undertaken on the grounds of “safeguarding competitiveness” are likely to be more difficult to be accepted. At a time when many companies are suffering from this slowdown or shutdown of activity, where unfortunately a certain number of them will find themselves in legal redress, two types of transformation will be carried out jointly:

• The “urgent” transformations, aiming at the survival of the most weakened companies, on the verge of bankruptcy;
• The “structural” transformations that will continue to accompany medium/long-term strategies, but which must necessarily take into account the lessons of this crisis; and the need for organizations to equip themselves with reinforced means to deal with it in the future.

Without pretending to be oracles, what latitude will companies have to carry out their post-Codiv-19 transformation project? 

At the end of this crisis, companies will be dealing with an important paradox. On the one hand, the government will rely on company’s social responsibility, strongly recommending to not reorganize themselves or lay-off people. It was with this in mind that it has initiated and financed partial activity, a deferral of charges and a guarantee on loans. On the other hand, to offset the considerable losses incurred during this period of containment, the shareholders and, more generally, the financial markets will push the Management Board to carry out major restructuring.

For some activities that have been very strongly and durably affected (energy, automotive, aviation, events, etc.), the need for change in order to overcome their economic difficulties can be understood given the seriousness of the situation. For other companies, which who would nevertheless like to continue their transformation policy planned over several years, major needs for explanation and guidance will have to be deployed, otherwise the company’s name will very quickly be associated with the “crisis opportunists”.

The economic reality will take back “its entitlements”, as we well know, but the steering by the Management of profit-making companies of their transformation plans is likely, for some of them, to be more complex post-Covid-19.