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COVID 19 Implications on the Organizational Culture

Last Updated on June 16, 2020 By Maha Atif Farooqi Leave a Comment

With the ongoing COVID 19 pandemic, businesses have to rapidly align their management and organizational behavior. The impact of COVID 19 on the business environment has accentuated the economic ramifications.

Companies are struggling to manage and meet their planned goals and aims and customer demands. There is a shift in the consumer demands, supply chains globally have been deviated and government interference has increased.

However, businesses need to analyze the impacts and come up with a business continuity plan. A holistic view of the whole pandemic shows how the general and task environments have been adversely affected. Almost every industry is suffering from unexpected implications. 

COVID 19 has changed the involvement of all the stakeholders in an organization from a customer to an employee to an investor. Businesses are trying to come up with innovative ways to come out of these difficult times.

Consumers have lost confidence in the economy and reduced or postponed their unimportant purchases. So there is less demand to meet the regular production levels of the company. This has led to massive structural changes in the industry. 

The internal environment of the companies have immensely been affected, research shows that the talent management system is one of the most widely affected areas of business during such unanticipated times. It is merely conducive to provide the necessary training to employees through an online platform.

This is a grave problem if the nature of the job involves on the job training. Also, conducting interviews and assessing the caliber of the employees is another challenge faced by human resource managers. Though online interviews are doable, they do not allow for proper assessment of interpersonal skills.

Also, existing employees are finding it difficult to maintain their core capabilities since they are not able to work with managers as in a proper office environment.

It is difficult for the workforce to keep their productivity levels up in remote working conditions which are highly kindred with connectivity and security. 

As we know employee engagement and morale are a crucial part of organizational culture, the advantage COVID 19 has significantly hindered sustainable employer-employee communications. Face to face meetings has been canceled in lieu of worldwide lockdown.

Technical issues and differences of time zones arising from remote working is leading to distortion of messages. Now, this is where the slope of performance and goal setting goes down.

Moreover, strategic objectives that require team working are now being completed through online platforms but the efficiency and momentum of the team working at the workplace stay absent. We all admit that we are social animals and need moments of interaction with our colleagues to maintain a sense of belonging.

Having said that, it would be reasonable to look at this situation from Maslow’s perspective. We can now realize how his theory accurately included the self-actualization and emotional needs of the employees such non-interactive working sessions are making both the employees and managers demotivated. Thus, the compounded effect of all this brings us to the loss of productivity and financial implications.

Most vitally, the rising concern of job security amongst employees is also one of the biggest impacts of the pandemic. Evidently, the fluctuating oil prices have triggered almost every industry in the world and businesses are panicking as they did not have contingency plans to deal with such situations.

Major losses in revenue and cash flows have incurred and this has compelled businesses to revise the equity planning as the share market has also taken a steep decline.

Since negative cash flows are directly related to operational efficiency, businesses are either considering laying off the workers or reducing salaries. Furthermore, the uncertainty that still prevails around the world is signaling potential job losses and a global crisis.

Moreover, with this societal crisis going on, it is important to prioritize the health and safety of the workforce. Companies need to make sure that the employees are fully equipped for what it takes for remote working and using it more effectively.

If needed the companies need to make changes in the current communication plans and make sure that there are clear communications taking place between employers and employees and in between employees so that there are no gaps in any conveyance and for effective feedback. Businesses need to steadily adapt to uncertain market conditions and make sure that the workforce isn’t stumbling too much with it. 

The pandemic’s effect on the external environment has put substantial strain on the supply chains of businesses as the consumers have shifted to online platforms in order to purchase groceries and other household stuff.

Unexpectedly delayed orders have resulted in problems regarding contract management and advance payments. Other stakeholders such as shareholders and investors have become skeptical about future industry-wide prospects.

Also, the manufacturing businesses are also in a dilemma as the demand for certain consumer goods has either dramatically increased or decreased. Decisions regarding what to produce, how to produce, and for whom to produce have really become a challenge as people are taking advantage of online shopping nowadays.

Nevertheless, during this pandemic, technology has undoubtedly become the backbone either for work and daily home activities. A wide range of technology has allowed us to make a plan of action, manage, and respond to this calamity like never before.

Digital commerce was seen as a non-essential form of medium earlier, now businesses have to revamp every feature towards a digital perspective. All businesses have resorted to remote working tools such as Zoom, Microsoft Teams, etc.

However, the need to ensure that employees are well-equipped with the remote working tools is again a major challenge for the managers. Therefore, this is where the phenomenon of Artificial Intelligence and cloud-based systems comes into action.

All of these were available in different areas to different degrees, but this time has given us a chance to utilize it to its full potential. While this can be taken as an opportunity, it depends on the flexibility and loads the company can take; and if it can take actions at the same pace. 

Maha Atif Farooqi

Maha is an undergraduate business student aspiring to become competent finance professional.

Filed Under: Business, Industries, Management Tagged With: COVID-19, Organization, Organizational Culture

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