The way out of the crisis: Discussion with three entrepreneurs in China
April 23, 2020 - In the Spotlight
In order to help companies in Quebec get through the crisis, La tête chercheuse activated its network in order to speak with Canadian entrepreneurs currently operating in China and living the aftermath of the crisis. Hoping that their lucidity will help you approach the coming weeks with confidence, here are some of their key learnings and advice we are happy to share.
Remaining hopeful up until the recovery
We are currently experiencing one of the major global societal crises since the stock market crash of 2008. The current crisis is incomparable. Unlike the crash or even the Great Recession of 1929, it is rooted in a real human disruption (pandemic) and not in the economy.
Hoping this crisis will not have been in vain and that we will emerge victoriously, La tête chercheuse spoke with entrepreneurs currently operating in China and linked to Canada, who are currently living the post-crisis period:
1) Teddy Hu, CEO at PBB Creative, an advertising agency in Beijing with 30 employees, including several from Quebec, who managed to get through the crisis without dismissals.
2) Carl Breau, CEO of Saimen, an entertainment, education, and technology company with Chinese offices in Shanghai. The company also has an office in Montreal.
3) Joel Shuchat, a Montrealer and seasoned businessman in the restaurant and tourism industry. Ownder of the boutique hotel The Orchid as well as a bakery and two restaurants: Toast and Furongji in Beijing.
We also sought the perspective of a renown figure of trust within organizations:
4) Mr. Donald Riendeau, Executive Director of the Institut de la confiance dans les organisations.
We questioned them, wanting to find out… what can we expect to find on the other side of the rainbow? The goal: to cultivate hope, but also, to learn from their experiences.
Surviving the crisis
When asked what has enabled them to cultivate trust through these uncertain times of containment, our three leaders in China agree that constant communication – with their customers, employees and partners – was the key to their success: ” With our remaining management staff of 12 people, we created a small crisis management unit, also handling marketing and sustainability. This special status has led to better cohesion and communication with our customers while allowing for a streamlined flow of information between our different companies.” says Mr. Shuchat.
Mr. Donald Riendeau agrees and goes even further. According to him, the foundations of trust start well before the crisis. “The issues of trust depend very much on the relationship that existed prior to the crisis. If you have established a solid relationship from the get-go, you are going in with a clear advantage.”, he explains.
Mr. Hu agrees: “Trust is built over time. I do not think it is possible to do a single action during a crisis that suddenly builds trust. You have to have a good foundation and work on it.”
Mr. Carl Breau is on the same page as his fellow entrepreneurs. According to him, the elements that helped his company get through the crisis were the development of a good business diagnosis, making the right business calls and, above all, taking care of his team: “At Saimen, we wanted to protect our people and show them that we care about them. We sent them masks and equipment to protect their children at home. When we will be ready to take the next step, everyone will be united because they felt that we care about them.”
Welcoming the future
Once we have managed to take care of our people and make them feel considered and safe, how do we prepare for times of recovery and keep hope for what is yet to come?
For Mr. Breau, the crisis has positive effects that should not be ignored. “It is not easy, but it is an opportunity to grow and change as a company. For us, because of the containment measures, travel costs have fallen to zero. This new reality has allowed us to remain as profitable as we were before… and we have seized a new opportunity to reduce our operating costs.”
At the end of the crisis, there is also a risk of a return to essential values such as solidarity and a certain social awareness.
“We will realize which professions really helped us get through the crisis and we will make social compromises to lower certain wages, in order to increase others: delivery men, garbage collectors, couriers, beneficiary attendants, etc.”, explains Mr. Riendeau.
And what about telework! Formerly relayed to the fourth basement by many companies anxious to see their employees take advantage of it, it is now here to stay! Employers will realize that they can trust their employees who work remotely and that it will save them time, while preserving the environment. “For me, the biggest change has been the acceptance of working remotely as a viable alternative. Before the crisis, I thought I constantly had to be on location to motivate my staff. Today, I see that everything is working smoothly, even after three months of not being physically there!”, details Mr. Shuchat. Although a crucial element in our 2.0 entrepreneur toolbox, working remotely will in no way replace the richness of face to face human relationships. Mr. Hu explains “Face to face is still very important, especially here in China. Over the next few months there may be less physical interaction, but I think that they will gain in importance.”
Learning from the hard times
Once everything is starting to get back to normal and we feel we are getting closer to a new “stability”, what lessons, learned in the depths of the crisis, will be the most relevant to keep with us?
When discussing the tourism industry, caution is advised. Many barriers still seem to be in place, despite early signs of economic recovery. Mr. Shuchat foresees a big slowdown among the Chinese population: “For the next two years we are expecting tourism to be almost exclusively Chinese. We do not expect foreigners to be welcome in China and this likely until the next Olympics. And we also do not expect many Chinese to willingly travel much outside of China either.”
That being said, the arrival of a vaccine might have the potential to be a true game-changer. “Certainly, there will be greater protective measures, but I believe if a cure exists and there is a vaccine, then everything will go back to what it was before. Human need other humans.”, says Mr. Hu.
“When things start again, the context of customers and suppliers will be different than what it was before the crisis.” explains Carl Breau, for whom it is essential to keep a keen eye on cashflow. He says: “A learning that we have done for the future: living a little less on credit, and building ourselves a safety net is really crucial and will allow us to get through other crises without having to push the panic button.”
Another element to keep in mind, according to Mr. Hu: the adaptation of your processes, due to the growing contribution of digital-related revenues: “As we move online, business processes become more important. This should have been built before, but if processes are not clear, they will have to be made clear. This will directly affect your efficiency.”
Although the international situation caused by COVID-19 is alarming, it leads us towards (positive) change. It forces us to review our priorities and, in some cases, our business models.
Among the lessons learned: technology is here to stay, preventive cashflow management can help weather the storm, and caution must prevail – financial recovery is a fragile beast that needs to be handled with care. More importantly creating a solid bond of trust with our customers, suppliers and, moreover, employees – through constant and transparent communication – is what will allow us to prevail; and what will contribute to cultivating hope while staying stronger, together.
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