COVID19

Pleased to join the CBC News Network Weekend Business Panel on a busy news week, alongside Jeanhy Shim, Gareth Watson, and John Northcott, talking the impact of Hurricane Fiona and changing travel rules.  You can watch our segment here.

A few thoughts on our conversation.

Hurricane Fiona has brought significant damage to Atlantic Canada, including Nova Scotia, a place that has been close to my heart for many years.  Although the human toll and importance of personal safety are top of mind, our discussion (being the Business Panel) focused on business.

There are many aspects of how disasters and challenges that have the potential to impact business for any period of time can be problematic.  Despite technological advances and increases in remote work arrangements, companies of all sizes tend to generate a lot of paper; this is especially the case for small businesses.  When disaster strikes, it is a good reminder to think about the ease with which a company could continue to operate, in the event that “the office” could not be accessed for a period of time, is damaged, or worse.  Here are a few things for business leaders to think about:

• What information is critical to the company’s operation?  Where is it stored (i.e., online, paper, both, etc.)?
• Does the company have online systems that are secure and operating well?  Consider areas such as accounting, banking, staffing, payroll, sales, customer service, operations, etc.
• Does the business leader have access to critical information in the event of a disaster?  Consider areas such as insurance, banking, financial information to complete claims and support applications, etc.
• Does the company have a communications strategy in place for contacting staff members, customers, suppliers, and other stakeholders?
• Does the company have a plan and strategy for continuing to operate, where possible, such as through remote operations or an alternate location?
• Does the company have a list of alternate suppliers, in the event that existing vendors are unable to fulfill their role?
• Does the company review its insurance coverage on at least an annual basis?  Business continuity insurance is an area to discuss with qualified insurance advisors, among others.
• What areas of the business still need to be migrated to an online solution?  In other words, what is in all of that “paper” anyway, and what are the areas of priority that need to be addressed?

This is an important area and something that will not be resolved in a day or two for most companies.  Advisors can help business leaders work through the detail to developing and implementing a plan to resolve this problem.

We also discussed the travel industry, in terms of the impact of rising costs/inflation, the removal of some COVID19 related travel requirements, and airline services from new providers.  While rising costs are expected to have an impact on spending in range of areas, some travelers will likely be looking for ways to make their money go further.  Tactics could include shorter duration trips, lower cost destinations, or traveling with others to make the most of accommodation dollars.  Given that the travel industry has struggled during the pandemic, it will be interesting to see whether the relaxing of restrictions such as masking on planes are an attraction or detraction for travelers, as COVID numbers rise in some areas.

And, finally, here are a few photos of beautiful Nova Scotia; thinking of everyone in Atlantic Canada who has been impacted by Hurricane Fiona and hoping for calmer seas ahead.  Thanks for watching.

Thrilled to join the CBC News Network Weekend Business Panel from my home away from home in beautiful Nova Scotia, alongside Elmer Kim and Natalie Kalata.  Our discussion included thoughts on Air Canada’s flight schedule cuts, Canada’s latest economic numbers, and the Cineplex fee that has would be movie goers talking.  You can watch our segment here, and below are some thoughts on our discussion.

The travel industry has been hard hit by the COVID19 pandemic and it’s not surprising that after more than two years, people are eager to get out and explore again.  It has been well reported that many air travel entities are short staffed, including airports, security, and airlines, resulting in numerous delays and cancelled flights.  Air Canada announced a schedule cut of approximately 15% of its Summer schedule, while Westjet proactively scaled back its own schedule.  This is analogous to making the playing field smaller, in an attempt to achieve successful operating outcomes within a larger system that has been challenged and is not able to operate at full capacity.  This situation is a good example of the many challenges of implementation, and businesses that face significant deviation from the plan can find themselves in a host of excess costs and resource drains in an attempt to recover.  It will be interesting to see the degree of operating success that airlines are able to find over the Summer, as well as what the Fall might bring.

Canada’s economy experienced a slight decline in May, as preliminary numbers indicate that GDP fell by 0.2%.  Although in contrast to earlier months, the recovery is not expected to be a straight line; ongoing monitoring is the approach that should be taken here.  Of note, the housing market continues to cool, demonstrating that interest rate hikes have had an impact, and manufacturing and construction are sectors to watch, as staffing and supply chain issues are likely to continue to have an impact.  The services sector is also one that suffered during the pandemic, and the relatively slow recovery could be a function of staffing concerns, but also consumer choice tradeoffs, as inflation continues to soar.

Cineplex’s new online ticket fee hasn’t impressed some movie goers, as the company says it plans to invest and evolve its digital infrastructure.  Although the fee doesn’t apply to all ticket purchases, such as those bought in person at the box office, it seems to be a counterproductive move at a time when entertainment and events companies should be doing what they can to welcome customers back.  It might not seem like a lot of money, but the reality is that consumers have a lot of choices, and once they are lost, it can be very difficult to get them to return.  This is an important reason why business leaders should think carefully when making decisions that impact customers directly, as well as their company’s competitive position in the marketplace.

It’s been great to join from Canada’s Eastern shore; thanks for watching!

As flood waters continue to rise in my area, pleased to join the CBC News Network Weekend Business Panel, alongside Mark Warner and John Northcott, talking rising interest and inflation rates, falling stock markets, implications of the latest jobs report, the end of COVID19 support programs, and consumer shopping habits. A lot to discuss, watch our segment here.

The intersection of all of these areas, something that tends to not be particularly well understood, is the impact on the “front lines” of business. It is relatively easy to step back and look at the economy through a broad lens, such as GDP, employment levels, or even the stock market; however, what businesses face directly, especially in difficult times, is much different. A few things to keep in mind as we consider this issue:

• Unemployment doesn’t tell the whole story.  Just because unemployment levels are low, it does not mean that businesses have the staff members that they need.  In fact, many companies are having a difficult time finding (and keeping) staff in a wide range of areas, including accounting, technology, sales, and healthcare, as well as front line workers; this includes both staff numbers and key skills.  Ask a business leader how hiring has been going in what is a very tight labour market (they will likely have a lot to say).
• The “stars” can write their own ticket.  Related to this point, it is the best staff members, in terms of performance and skillset, who have the most choices in this type of market when it comes to employment opportunities.  Companies should re-think their compensation strategy and flexibility in terms of work arrangements, in order to be competitive.  The “we just want people in the office” mindset, when not essential, is a losing proposition and some companies have likely found this out too late.
• Supply chain problems persist.  This crisis has impacted companies more than is generally realized, and this reality can only be fully appreciated at the front line level.  In short, companies need supplies and inputs to manufacture products and deliver services.  In the absence of this, their ability to do so stalls, resulting in either delays or inability to fulfill customer needs and generate revenue.  Remember that revenue eventually becomes cash, and it is easy to understand where a business is left when its sources of cash are impacted or lost.
• COVID19 support programs concluded.  As these programs effectively end this weekend, a lot of companies may find themselves unable to operate on a sustainable basis.  This can vary, as some industries have been impacted more than others (think tourism, events, and some services).  Expect to see the impact of this in the coming months.

The bottom line is this: building a company to the point where it can successfully operate over time and employ staff is not something that happens overnight.  Numerous companies have either quietly closed up shop over the past couple of years (think about the vacant retail and commercial spaces in your community) or are on the brink of doing so.  Many of these are small businesses, however, some are larger, impacting a lot of jobs and families.

Once a business is gone, it’s gone.  How long does it take to replace this loss with another company?  Years, decades, sometimes longer.  It is the patchwork of these companies that make up Canada’s economy and there is a need to better understand business issues at the frontline level, instead of taking primarily a broader approach.  This is especially true in challenging times, which are reasonably expected to continue for at least the next year and likely longer.

And finally, on a personal note, my contribution to this week’s Business Panel came directly from a flood zone, surrounded by water, but safe (there should not be any water in this field).  Not sure how long this “island life” will continue, but it is a reminder that we are living in unusual times.  Thank you for watching!

 

Great to join the CBC News Network Weekend Business Panel on a busy news week, alongside Dennis Mitchell and John Northcott. Our discussion focused on the impact of the Omicron variant on the markets, the good news in the latest Canada jobs report, and the intellectual property dispute between Peloton and Lululemon.

Some quick thoughts on our chat:

With the global pandemic approaching two years since the first days of widespread knowledge, Canadians have been looking forward to at least some return to normal life.  Greater access to things such as travel, events, and simply getting together have brought some optimism, however, the recent appearance of the Omicron variant is a reminder of the tenuous situation in which our world remains.  Markets reacted negatively to this development, perhaps, recognizing the potential for restrictions to return in the not too distant future (something that has already occurred in Europe) and what the impact on many businesses could be.  Equally concerning is commentary from scientific experts, including those responsible for developing vaccines, in terms of how well existing vaccines will work against the new variant (work on potential adjustments is already underway).  In these early days of Omicron, we are reminded that the best things that we can do is to follow the science and live our lives in a manner that stops the spread of COVID19; it is difficult to see how a healthy society or economy are possible without doing so.

With Canada adding 154,000 jobs last month, employment levels are almost 200,000 jobs higher than before the pandemic.  These measures represent points in time and employment is closely linked to the health of the community and the ability of businesses to operate (the supply chain crisis also impacts the extent to which companies are able to function well).  One of the interesting aspects of employment is the relative tightness of the labour market, especially in front line areas where people may be reconsidering their career objectives.  Also of note is the office job that can be conducted from anywhere, opening up new employment choices for many.  Employers will have to be careful about the choices they make, in terms of setting policy around the options of how employees can work (i.e., remotely, blended, on site, etc.), as staff members are likely seeking out what they view as the best career offering.  Remember that the “best” employees tend to have the most choices, which can leave some employers to a future of marginal workers; it can be difficult to unwind this type of situation once it has occurred.

And, finally, the intellectual property dispute between Peloton and Lululemon will ultimately come down to the details, as this is the nature of patents and other protections.  Of note, some business leaders might be surprised to learn that strategic partnerships tend to require far more time and resources than expected, which can lead to disappointing results.  Those who have lived this experience might have found themselves wondering why the partnership failed to reach what was considered to be its potential.  Keep in mind that having two parties doesn’t necessarily mean that there is less work for each to do, as well as the fact that one entity is not an extension of the other.  These common challenges are beside the point that the parties might also find that they cannot or do not wish to work together any longer.  Advisors can help business leaders to evaluate and address strategic partnerships, and it will be interesting to see where the IP experts draw the line in resolving this dispute.

Thank you for watching and enjoy the best of this Holiday Season!

Pleased to join the CBC News Network Weekend Business Panel on a bright Fall morning, alongside Mark Warner and John Northcott.  With lots to discuss on this busy news week, we chatted about the global supply chain backlog, the US opening its land border to vaccinated Canadians, and worker concerns at Instacart, among other companies.  Here is a clip from our discussion and some thoughts.

Although the global supply chain backlog received a lot of media attention this week, it represents a story that has been in the background for a number of months (if you had asked a random person on the street what they think about the supply chain problem, they probably would have kept walking).  This situation impacts companies and consumers alike, in that delays in receiving goods in need creates additional problems, as well as price increases.  Given the magnitude of the problem, it is unlikely to be resolved anytime soon, putting some items out of reach for a while.  Resolution will require time and collaboration from various parties, some of whom are likely not used to thinking creatively to solve problems.  This story is a reminder that implementation is difficult and various pieces are involved in the supply chain, including sea and land vessels, a range of workers, and policies and procedures to guide task completion.  Look for initiatives to improve operational efficiency going forward and consumers should be prepared to be flexible in expectations and to pay more for goods.

While Canada opened its land border to vaccinated US travelers a couple of months ago, the US will be reciprocating in early November.  It is uncertain what the initial level of uptake will be, however, it is fair to say that the pandemic has left a lot of people wishing for a return to some sense of normalcy.  As Canadians tend to favour the southern US states, where vaccination levels are currently relatively low, it will be important to ensure that screening requirements are consistently enforced upon return to protect against setbacks in the Canadian economy.  Travelers should be prepared to face additional costs and delays, something that is part of traveling (those who are not willing to follow guidelines or incur costs have the option to stay home).  One thing that we should be able to agree upon is the need to avoid a significant number of travel related cases of COVID19.

And, finally, Instacart’ s shoppers have indicated that they will take strike action against pay and working condition issues, shining a light on some of the challenges that are incurred by front line workers generally.  This issue has roots well in advance of the pandemic, as the gap between pay levels at senior and front line levels has become increasingly significant.  In a world of millionaire and billionaire CEO’s, contrasted with front line workers who have to take on various jobs, often without benefits or security, just to meet basic living requirements, many have simply lost patience with this issue.  Further, wage increases over the years have not kept pace with the rising cost of living or income appreciation at more senior ranks generally, causing additional frustration.

COVID19 has only made this situation more difficult, and as workers are integral to the ability of most companies to generate wealth, there needs to be some sort of reckoning on this issue.  Expect that many are tired of billionaires flaunting their wealth, in what can be viewed as a lack of attention and fairness being paid to wage levels in the lower ranks, and as job vacancies increase and people continue to rethink how they earn a living (workers have recognized that they do, indeed, hold some power).  It will be interesting to watch as this situation continues to unfold.

Thank you for watching and enjoy the Fall season.  See you again next time on the Weekend Business Panel!