Covid-19 : A Company Doctor's Diary
Matthew, one of our directors, has been keeping a diary of activities since the lockdown. We have the first few weeks available to read on this page and a chance to subscribe to his ongoing activities and reflections.
Read Matthew's Introduction
In the days before the phrases turnaround manager or turnaround practitioner were coined to describe my colleagues and I, we would likely have been known as company doctors – still a very accurate term for what we do for businesses.
The IMF made it clear last week that the idea that the battle against Coronavirus is a choice between lives and livelihoods is a false dilemma. We must prioritise saving lives in order to protect livelihoods, but by the same token, if we do not do enough to protect livelihoods, then we will lose more lives – if not to COVID-19 in the short term, then to other ailments in the medium-longer term.
Others like Andrew Griffith MP and Lord Sumption have also been expressing similar concerns in our Sunday newspapers in the UK.
I and my colleagues are not in any way medically trained and can only contribute to saving lives like most others – by following the hygiene and social distancing guidelines rigorously. However, we do have vast experience of saving livelihoods by working with companies in distress to turn them around or help them rise again from the ashes, thereby preserving value and indeed jobs.
This requires a particular skillset including:
- being able to stay calm in a crisis;
- making quick, reasoned decisions based on limited information;
- remaining flexible and not wedded to too rigid a plan;
- relieving pressure on management and handling tough negotiations with a variety of stakeholders with their own, often conflicting priorities;
- all while motivating others who themselves are suffering huge stress and strain – much in evidence in recent weeks.
Here is a brief highlights package of my own experiences over the last two weeks which demonstrates some of the specific issues we have been dealing with in this particular crisis which is leaving no one untouched.
Along the way we have generated a lot of new material for use in planning, sourcing funds, dealing with staff and other stakeholders – if any of this could be helpful to you or others you know struggling to handle the current situation, please do get in touch –
+44 (0)203 858 0289
Covid-19 Lockdown : Diary Entries
FRIDAY 20th MARCH
- Wake up to the news that the Governor of California has issued a Stay at Home order to all citizens.
- I am engaged part time as Interim COO and Chief Integration Officer for a UK client which acquired a LA-based company and was due to visit next week to commence the final phase of integration of the US subsidiary to a common ERP/MRP platform with the UK parent, but this has already been put on hold.
- As reported by the media I have assumed the LA factory will have to close, however, for far from the only time recenlty, I am sure to go to source before making a call. I obtain a copy of the Governor’s order and the LA Department of Public Health’s corresponding order, then quickly find myself researching the US Federal list of Critical Industries.
- By the time our LA staff are waking up we have ascertained that as a key supplier to a critical industry we can remain open, but clearly all staff who can should be working from home – we had already put steps in place to facilitate this earlier in the week, so actually little changes.
- We organise a vid con with the US staff to brief them on our thinking and they are very supportive and in full agreement.
- I draft and issue a formal ‘response’ to the order signed by the CEO for the staff to carry with them and we also share and discuss this with our own key suppliers, who had been on the verge of closing, but agree to keep working based on this.
- Meanwhile back in the UK the Chancellor announces the Coronavirus Job Retention Scheme – spend the weekend trying to work out how this will operate and ‘furlough’ becomes suddenly a very common word for me to use.
- Schools close today too which is also to provide some practical challenges. Last evening of opening for pubs, cafes, bars, restaurants etc too – businesses that will now have to ‘hibernate’ at best.
MONDAY 23rd MARCH
- On site with a client, we are already implementing hygiene and social distancing requirements – this has required a restructure of the production area layout, new shift patterns and replacement of some of the cables connecting the building to the outside world now that all the R&D and office staff are working from home- day 1 and nobody could connect to VPN!
- This particular client is on target for a record month having received its largest ever order over the weekend. Planning for shipping this in the next week with all the disruption of the above, plus now 3 key production staff self-isolating at home and 1 further one shielding is a real challenge.
- I agree my own split working pattern with two other members of the senior management so one of us, but only one of us, is present each day to support production and ensure insurance, health & safety etc requirements continue to be met – it is easy to view everything with COVID-19 blinkers on, but this is an additional issue, it doesn’t suddenly lift all other laws and obligations.
- The Prime Minister gives his address this evening and announces the lockdown. I receive 2 panicked calls from client CEOs who want to shut on Tuesday. They have watched the 10 O’Clock News and not the speech in full. I ask them to watch the speech as the media are again focussing on certain words and comments out of the full context. Their manufacturing businesses have not been ordered to close and workers who can not work from home can still travel to work. I persuade them both to remain open. They have order books to fulfil.
TUESDAY 24TH MARCH
- Work remotely with two new clients on their ‘hibernation plans’. They are leisure-based businesses that are captured by the announcement. Using the furlough option we pull together cash flow forecasts for various lengths of closure and scenarios for reopening.
- One has good cash reserves, the other does not and there are disputes at board level over the right path – some want to file for administration and even suggest a pre-pack (for what I ask?). Deal with this and buy time to implement the hibernation, for review in 3 weeks.
- Also contacted by an advisor to a business which is actually looking at this as a time for potential bargain basement acquisitions and/or wants to scale up internally due to increased demand (they supply energy, medical research and healthcare industries). They may want some support on strategic planning, fundraising and structural options. Provide some high level advice to help focus minds.
- Also draft up announcements to staff for the two businesses I persuaded to stay open. This is helped by the Health Secretary confirming that those who can not work from home, should go to work to ‘keep the country running’. So long as you can observe the hygiene and social distancing requirements of course. Support one of the CEOs on his vid con with staff to explain the decision and steps being taken.
WEDNESDAY 25TH MARCH
- My first day of home school responsibilities with my daughters. My wife works from home for a variety of clients and needs time to do her work too.
- She has a concern with a shipment of books to the US where it appears the distributor has shut down and won’t be able to accept the shipment or distribute it. I help with a conference call with the US to work through the right decision tree to define a solution based on my experience to date. It turns out a skeleton staff can keep working and mini-crisis is averted.
THURSDAY 26TH MARCH
- Back on site supporting a manufacturing client. Draft updated guidance for staff and as the only person in the office part of the building end up preparing shipping documents and supplying responses to the auditors’ requests under instruction from other staff working remotely – nice to be working on something more normal!
- Begin negotiations with the landlord for a reduced rent or rent-free period. There is leverage given the size of the rent deposit and an upcoming break clause – initial response seems supportive.
FRIDAY 27TH MARCH
- A home day. Support one client preparing a Business Interruption Loan application with one of the main high street banks who have been excellent – speedy response, clear advice, no PGs required….
- Have a call with a manufacturer who shut down on Tuesday morning, but has realised they didn’t have to – a conclusion I support – looking for help to get up and running again. The initial barrier is identified as convincing the production staff, so I introduce a trusted HR advisor to support these discussions.
- Spend the afternoon on a shareholder call for one manufacturing client – they are querying the decision to stay open, so I present my case and take them back to the source advice and guidance and ask them to ignore the media and social media noise. They are not only supportive by the end of the call, but also full of praise and questioning some other businesses they are involved in.
SUNDAY 29TH MARCH
- Nice to read a piece by Andrew Griffith MP in the Sunday papers that criticises the over reaction of some large firms and supports those who are trying to keep businesses going while complying with the hygiene and distancing guidelines – future generations will thank us he writes.
MONDAY 30TH MARCH
- Hold 1:1s with all production staff at one client. They have been coming under material social pressure to stay at home and two more are self-isolating.
- We work through the guidance step by step and ask them to suggest any other changes they would like. A delivery of disposable gloves arrives which helps.
- The company won’t be forcing anyone to work, but there are limited options for staff if they choose not to come in and are not self-isolating or shielding. The company is generally being very generous with how it is treating sick or shielding staff.
- I do not believe furlough can be used in these circumstances though (i.e. where there is work and no shielding need) and speak to a trusted employment lawyer who confirms this.
- The employment lawyer also raises a number of concerns with how most companies are handling the situation with staff – existing employment law doesn’t just disappear and become irrelevant.
- We draft and issue updated guidance to all staff.
TUESDAY 31ST MARCH
- Something I have been meaning to do for my main client for a number of days – obtain and review all their insurance documents. There are likely to be issues with equipment being at people’s homes, home becoming the main place of work for most employees etc. Do the employees’ own home insurance policies cover them working there too? This becomes an urgent concern and we work on a policy to cover this.
- Join a number of calls with suppliers to ascertain their situations – we are dealing with almost daily component changes, but to date are keeping just ahead of them.
- Also speak to a US, UK, NL, AU education provider who are working out how to pivot from a face to face provider to a virtual provider – I draft a scope to support their forecasts, plans and fundraising efforts. Their niche is possibly and even more required skill right now.
WEDNESDAY 1ST APRIL
- Banker bashing is back in fashion, but is this fair? Even with an 80% guarantee from the government, should you putting more debt on the balance sheet of a business where you have no visibility of when they might trade again and what that will look like? Given the criticism of banks for past lending practices the answer has to be no. A short term overdraft to tide over until government furlough payments kick in, possibly. My experience to date has also been good with the bankers I have spoken to – the media again seems to only want to focus on the negative stories.
- People are respecting my home school day far more than they normally do with holidays etc!
THURSDAY 2ND APRIL
- We hold a call with our European associates to get an update on where things are for them. We have people on the ground in France, the Netherlands, Spain, Germany, Italy, Romania and Greece.
- EU cooperation seems to be non-existent and there are wildly differing approaches to how to support business – how to support livelihoods.
- Also have several calls with key Private Equity contacts to understand how they are positioned and what is happening in their portfolios – they are largely all still trying to work this out – certainly no new money will be going out any time soon unless supporting existing investments – they expect activity in maybe 6 months.
- I speak to a real estate portfolio manager too – commercial landlords are really struggling, but seem to just expect covenant waivers and forbearance even without any numbers or a plan. Their problem though is they need the same from their tenants first, but what can a tenant give them if they are closed and don’t know when they will open? I explain my approach with the hibernation plans I’ve advised on / prepared and put forward the key priorities for information and good discipline – this shouldn’t go out of the window in a crisis and indeed becomes even more critical – COVID-19 blinkers perhaps in evidence again?
FRIDAY 3RD APRIL
- Implement the first staff furloughs for a client after proper consultation and using great templates supplied to me by a trusted HR advisor.
- Pull together a toolkit of key survival docs I’ve come across or created to date.
- Watch the joint WHO / IMF press conference which is illuminating and leads to me putting pen to paper here.
