What are CEOs doing to stay afloat during coronavirus?
More than 10 million Americans have applied for unemployment benefits.
The recession that is looming ahead points at being the worse since the Great Depression.
Markets are crashing all over the world and businesses are close to bankruptcy
You may ask, what in the world can a CEO do to face the crisis? It’s tough, but many are in action.
No one is crying for them as they make the toughest calls of their careers, such as laying off hundreds of employees or stop paying them during the lockdowns.
Yet, they are expected to take action. CEOs have shareholders and hundreds or thousands of employees they must respond to. If you go into a quarterly earnings conference calls, you’ll probably hear a lot of it’s tough to say.
But some are taking action.
Bahram Akradi is the CEO and founder of Life Time Inc., a health-club franchise. He’s facing incredibly tough and unsolvable issues, such as $1 billion in new developments completely stuck.
But that’s the part he can’t control. What can he control? The more than 38,000 people on his payroll. 90 % of them have been put on leave, however, the company has committed to pay a full 100 % of their insurance premiums and establish a $10 million fund for employees whose essentials cannot be covered with unemployment checks.
Another good example is Ian Siegel, ZipRecruiter Inc. Founder and CEO. When April began, he had already laid off or furloughed a third of the staff.
When the future seems so dark and unpredictable, you have two possibilities: take tough choices now or take them later. Siegel went for the first possibility. He spoke individually with each employee via videoconference and hopes to rehire them as soon as possible.
Other CEOs are facing even bleaker scenarios. Arne Sorenson, CEO of Marriot International forfeited his salary, and other executives took a 50 % pay cut as the company will furlough tens of thousands of employees around the world.
However, the situation doesn’t seem as bleak for all. For example, Dr Pepper has seen a demand surge as consumers are piling up bottled water, soda, and juices. The company has 25,000 employees that now face a significant workload. Yes, the future of the company isn’t immediately compromised, but that means Dr Pepper needs to increase its production and keep their workers safe amid the worst pandemic the world has seen since the Spanish Flu.
They are already having health-related issues: a distribution employee tested positive for COVID-19, and coworkers who were in contact with him are now in quarantine, all with full pay.
The company has started to sanitize its plants more frequently and reduce direct interactions between workers as much as possible.
CEOs are making the toughest choices in their careers. However, the poorest choice is no choice. Paralyzing, when facing the hardest challenges of your business is the worst option.