Every time I hear the news I hear more about the swine flu epidemic that could be another over-hyped scare story or it could be a huge threat to both businesses and the population.
I am sure that it is making people more aware of coughs and sniffles and could be creating a tsunami of hypochondria.
Swine Flu Current Situation
At the time of writing, the number of people in the UK with swine flu is rising steadily although the 100,000 new cases per day mentioned by Heath Secretary Andy Burnham on July 2nd still looks a long way away although it is a staggering number to even contemplate.
The spread depends on the virus copulation rate and small changes in the rate can result in huge fluctuations in the forecasts because of the effect of compounding.
Swine flu is also said to have a similar mortality rate to normal flu - around the 0.5% (based on reported cases) or 1 in every 200 sufferers will die. Many of the current deaths have come from people with other health problems but there has been a case of swine flu causing death in a healthy person.
If Andy Burnham is right with the 100,000 victims and the mortality rate doesn't change, that would suggest up to 500 swine flu related deaths per day in Britain at the end of August/early September.
These are big scary numbers.
So How Does Swine Flu Affect Business?
We need to consider macro issues which impact on the national and world economy, local issues that impact on the local economy and micro issues which impact on the individual firms.
Macro Impact Of Swine Flu
Not good news.
The current economy is blighted by recession with unemployment expected to continue to rise until well into 2010. It was reported yesterday that a record 281,000 people lost their jobs in the three months ended May 2009.
The future economy carries the burden of the economic bailouts and huge recovery programmes and firm action is needed before the demographic time bomb of pensioners to young reaches crisis point.
Like a battered and outclassed boxer, things are wobbly and the knock out punch might not be far away.
Swine flu may be that heavy blow that turns the recovery into a W with a double dip or and L.
As people become more aware of the risks of the spread of swine flu, businesses where people gather will be under-pressure. The "safe" thing will be to stay at home.
Theatres, cinemas, hotels, restaurants, airports, conferences can all expect to see customers decide to spend their time elsewhere.
Even shopping will be under threat as a leisure activity since you are exposing yourself to more people who could be contagious.
Oxford Economics, an economic forecasting group, calculated in June 2009 that if the pandemic were to last six months, world GDP could be cut by £1.5 trillion - or 3.5% of GDP for 2009. The eurozone and the UK could lose 3% of GDP.
This is an extra 3% on top of whatever the recession and credit crunch was bringing.
And as sectors are affected, the pain of the economic cutback ripple back along the supply chains.
Local Impact Of Swine Flu On Business
I live in Birmingham which is one of the worst affected regions in the UK for swine flu.
While the spread is worldwide, I think it is inevitable that some countries and areas are going to be hotbeds for swine flu with particularly high infection rates.
Just as leisure activities will be under threat as people fear infection, public transport is also very vulnerable so areas that rely on it like London will be vulnerable.
Swine flu is another reason why I wouldn't want to be travelling on the Tube each day.
Schools have been closing to help contain the spread of infection and that puts pressure of local parents, especially those who are working.
Micro Impact of Swine Flu On Business
This is the impact of swine flu at an individual firm level.
The effect of swine flu can be serious and you need to look at it across different levels:
- Your employees
- Your customers
- Your suppliers
How Swine Flu Could Affect You The Business Owner
What happens if you get swine flu badly?
The risk of illness is always there but the swine flu pandemic says the risk is much higher although for most it is only going to be temporary.
So what happens to the business if you can't work for two weeks?
Do you have a contingency plan for the essential activities you do so that the business stays open?
How Swine Flu Could Affect Your Business Employees
I suspect that the recession has already seen cutbacks to the bare bones for many firms.
- Staff illness - one person ill is bad enough so you don't want people to bravely soldier on and infect your other staff and customers.
- Family illness - swine flu is considered to be highly contagious and it is a killer. Employees will need time to care for their loved ones, and even if they are not showing symptom, they may already be infected and contagious.
- Fakers - perhaps I am cynical but some people will tempt fate and use swine flu as a chance to "swing the lead" and get out of work. Even if it is not deliberate malingering, it is difficult to distinguish between the hypochondriacs who see every sneeze as the first indication of infection and those who have genuine cause for concern and who are acting responsibly.
Do you have a standby plan if key members of staff are away ill? Are there essential skills and knowledge which you must capture?
How are you going to protect your staff from infections?
Swine Flu And The Impact On Your Customers
What happens to your business if your customer base is badly affected by swine flu - or the fear of swine flu?
You may see orders and sales reduce and payments extend and if so, is your business healthy enough to survive?
You also have an obligation to reduce the risk of you or your employees infecting customers with swine flu.
Swine Flu And The Impact On Your Suppliers
Things could start getting unpredictable and your business can be stopped by a shortage of key inputs and services.
Can you identify where you are particularly vulnerable and compensate?
How To Protect Your Business From The Impact Of Swine Flu
There are more questions than answers, partly because don't know your business and partly because the entire swine flu situation is surrounded with uncertainty.
1 Keep Up To Date With The Swine Flu Symptoms & Recover Times
You need to be able to recognise the symptoms in yourself and in your staff and you need to make sure that you keep your staff informed.
Keep factual - I suspect that there will be a range of reactions from panic and hysteria to "what's swine flu?" Share what you know about the symptoms, infection risks and how to minimise spreading the virus.
You may even decide to turn customers away if they are showing visible symptoms. I understand that airlines won't accept sufferers because of the risk to customers and crew.
2 Identify Critical Activities - Cross Train & Record Procedures
Some activities are much more important than others, so idea what must be done to keep your business working.
Then identify who is currently capable of doing those things well and adequately.
Do you have the cover you need or do you need to provide some emergency training or get the procedures written down quickly?
Yes every small business should have written procedures that explain how things are done but many business owners see it as busy work and even those who have tried to record the systems, may find that the records are well out of date.
It only needs a computer upgrade to make instructions like "take option 5 on menu B" nonsense and suddenly you can't invoice customers or run your payroll.
But focus on the critical activities first.
It's nice to have all the business processes recorded and staff extensively cross-trained but don't try to do everything.
Much better to cover the A "must have" activities and then the B "important to have activities" finally reaching the E "has to be done some time" activities.
3 Decide On Your Swine Flu Policies
Do you need a customer swine flu policy?
It might cover refunds for services you can't provide, that customers are enable to receive and how you treat people who appear to be ill.
Decide on your swine flu employment policy so that your staff are clear on what is expected. Already the testing facilities are struggling to cope so you may have problems if you try to distinguish between confirmed and suspected cases.
It is being reported that the UK self certification sick note policies could be extended from one week to two weeks to keep people out of Doctors' surgeries (two weeks without a doctors note).
4 Can Arrangements Be Made For Home Working?
One way to reduce the threat to the rest of the staff and customers is to increase the opportunity for home working but it will only be possible for some jobs.
But if someone is showing some symptoms of swine flu but still feeling well enough to work, home working lets them continue to contribute.
It also helps employees to avoid the risk of infection from travelling on public transport.
5 Write / Update Your Contingency Management Plan
It is better to be prepared and to have time to think about how your business will respond to the threat of swine flu that to have to respond quickly in a crisis.
Contingency plans can smack of big business and bureaucracy but something is better than nothing.
Identify your second and third in charge if you are taken ill, and if you work closely you may need to go further. Be clear who has the authority to make decisions and take actions.
Share your critical activity list so that your staff know what must be done and who is best to do it.
It is still very unclear how extensive the swine flu epidemic will be but virus theory shows that things can increase exponentially.
You need to do enough to protect your business without losing sight of the fact that swine flu is a risk and not a certainty.
6 Try To Conserve Cash
Things could be bad but they will be worse if your business hits a cash crisis.
Stop any extravagant and unnecessary purchases.
Try to speed up your cash collections from your customers.
If you have a buffer of cash, you have options and the power to choose.
Swine Flu & Business
Do you have any thoughts on how swine flu will affect business or advice on how businesses should respond.
I would welcome your comments - just look out for the crafty captcha check after you have typed in your comment.
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