By Ken Matthews, Managing Partner, Matthews Steer.
It’s my favourite quote, attributed to the historical figure I most admire:
“Never let a good crisis go to waste,”
said Winston Churchill, the British Prime Minister from 1940 to 1945, and from 1951 to 1955.
Churchill reportedly uttered these iconic words during the Yalta conference in 1945 when allied heads of state Churchill, Franklin D Roosevelt and Joseph Stalin met to discuss the post-war reorganisation of Germany and Europe. Their meaning – that dramatic change invariably stimulates fresh insight and opportunity for growth – is simple but resonant, and applies equally to the current state of change and disruption Victoria, Australia and the world is undergoing today in the face of the COVID-19 pandemic.
There has been a great deal of negativity regarding the economy in the media since that fateful day on Friday March 13, 2020 when Premier Daniel Andrews cancelled the Australian Grand Prix, and initiated the process of lockdown that has changed our lives and our economy over the past 77 days – and maybe forever.
I am not for a moment denying the serious health crisis we have on our hands, nor the 103 lives lost to date. That is a tragedy. But the reporting of the situation from an economic point of view has, in my opinion, been disproportionately negative.
I feel for those in the accommodation, hospitality and retail industries - 84% of accommodation and food services businesses are expecting reduced demand for their goods and services in the coming months, while 61% of retail companies are forecasting reduced turnover in the coming months* - but other areas of the economy are, in my view, holding up well all things considered.
I am amazed in the resilience, ingenuity and determination of our clients who are taking the opportunity to re-engineer their businesses for the future they are not going to lay down or having any sense of giving up! They are living examples of the power of hitting the pause button and asking: “what does this crisis have to teach us”?
The ‘new normal’ prompted by COVID-19 presents real opportunities for business owners to reflect on their operations, develop new perspectives, and reengineer and rebuild their businesses to embrace and conquer the impacts created by the post-Coronavirus economy.
If you’re a business owner, your challenge is to:
Reflect on your priorities, immediate responses and actions to date?
Review your view of the impact of the current environment?
Decide whether your priorities, responses and actions need to change.
Over the past 77 days, businesses across the board have embraced technology like never before, because they have had too.
Within our client base, and throughout Victoria, I’m seeing cleaning companies pivoting to sell hand sanitisers and personal protective equipment, dine-in restaurants re-evaluating their business models and selling take home meals and takeaway, and manufacturers reviewing their processes, products and customer lists to improve efficiency, productivity and profitability.
In our own business, we’re continuing to invest in the long term future of our firm and the people it represents. If that appeals to you, and you’re interested in creating a unique future in accounting and advisory, we are recruiting now and have some outstanding positions available for talented accountants.
It is heartening to see that the ANZAC and entrepreneurial spirits burn bright in our local business community. We look after more than 400 business groups as clients and, unless something comes totally out of left field – we can’t see many – if any – that won’t still be here in six months.’
While the disruption to the economy created by lockdown is inevitable, and undeniable, the unprecedented financial stimulus provided at state and federal government level, combined with Australia’s rapid and – so far effective - attempt to ‘flatten the curve’ could mean that economic activity recovers more rapidly than anticipated.
I might be seeing this with rose coloured glasses but I can only call it as I see it today. Our economic future is not all negativity and doomsday prophesies, and I take great pride in the ability of our people, our clients and our country to rise to the challenge of COVID-19 and come out the other side stronger, with greater innovation and resilience.
Another famous quote attributed to Churchill feels particularly apt as COVID-19 restrictions begin to ease, the medium-term impacts of economic shut-down crystallise, and smart business owners continue to seek ways to reinvent themselves and reengineer their businesses: “Never give up on something that you can't go a day without thinking about.”
* Besa Desa, Chief Economist, St George, May 19, 2020.
The Matthews Steer team is on hand to assist you and your business over the coming months. Our office remains open and we will be working physically and/or remotely to support you. We offer a range of business advisory services. Please don’t hesitate to call us on(03) 9325 6300if we can be of assistance.