While cash flow is a top concern, most believe a productivity slump may hit the business harder in the long-term
Leaders believe a dip on employee productivity during COVID-19 may have the most severe impact the future of their businesses.
According to the recent study, almost three in five (57%) leaders globally cited the negative impact on productivity as a top concern amidst the crisis. In Singapore, 50% of leaders cited it as their greatest challenge.
The findings showed that productivity is a greater issue than ongoing cash flow problems.
The most severe impacts of COVID-19:
- Productivity slump – 50% in Singapore, 57% globally
- Cash flow problems – 35% Singapore, 37% globally
- Customers stopping or reducing purchases – 36% Singapore, 29% globally
- Forced deferment of new product launches – 29% Singapore, 24% globally
- Supply chain disruptions – 27% Singapore, 24% globally
READ MORE: COVID-19: HR's main challenges revealed
The study by ACCA (the Association of Chartered Certified Accountants) also revealed what leaders believe will be the financial worst-case scenario of the crisis.
While 72% of business leaders said they have completed a financial reforecast recently, 89% of them believe worst impact will be negative revenue growth. A mere 7% of leaders are anticipating positive growth, with the remainder seeing no change.
Profits-wise, 92% of respondents see a negative effect on their profit growth compared with the previous financial year.
With the Singapore government offering stimulus packages amidst the crisis, 69% of leaders said these were likely to be effective. However, 43% were unsure if they would eventually make a difference.
“Everyone’s hurting, but particularly the smaller organisations,” said Jamie Lyon, the report’s author.
“Financing and cash flow are concerns to everyone across all the countries polled.
“For many of us, the ‘face of work’ has changed overnight. In the short term, organisations are facing a very difficult operating environment when it comes to employee productivity and engagement, alongside a number of compounding and wide-ranging consequences.”
While organisations globally have been hard-hit due to today’s interconnectivity of businesses, Reuter Chua, head at ACCA Singapore said it’s heartening to see employers’ commitment to ensuring the health and well-being of employees and other stakeholders, and the resilience being shown in the face of an unprecedented crisis.
Chua recommended adopting the three ‘A’s of crisis planning:
- Act to respond in a sustainable manner and focus on employees and stakeholders
- Analyse the different information sources to secure your organisation
- Anticipate the business impact and future trends
“Overall the data confirms Covid-19 is a huge challenge across all sectors and sizes of businesses, regions and countries,” Chua said. “The main issue is uncertainty, which affects the ability of organisations to plan properly, to react and to forecast appropriately.
“While talking of silver linings may be very hard at this time, we need to think about every opportunity, and to consider every option available to keep businesses large and small afloat.”