COVID-19 Global Partner Update 8 April 2020
IXPA offices from across the world particpiated in our lastest partner update conference call on Wednesday 8 April 2020. Under normal circumstances we would not release notes from an internal meeting however these are extra ordinary times and we collectively feel that our clients and Interim Managers will be interested in first hand updates from around the world.
Please click on the country names to be taken to the relevant page on the IXPA website.
Economic impact now being felt in China from International companies who are reducing their staff. China is still restricting foreigners coming into the country. Day to day working has returned to normal, shops, bars and restaurants are mostly back open and Wuhan, the epicentre in China lifted its lockdown on the 8th April.
Surveillance and big data is really helping in this case, where it has identified people carrying the virus and then gone onto identifying all the people that they have come into contact with – all are being quarantined. The government is able to track and identify people through mobile phone APPs, which has helped limited the spread, once positive cases were found.
Decision making processes are broken for senior recruitment, therefore leaders are not being hired on a permanent basis. Final interviews are not happening as they often need authorisation from the International head office which is based outside China.
A number of foreigners (including some business leaders) are currently locked outside of China, due to the temporary suspension of foreigners with visas being allowed to enter China, which has been in place since the 28th March.
Is very safe, 900 cases but that is thought to be through immigration. Large groups are banned but its ok in small groups. Staff able to get into work everyday. Staff from multi national companies are working from home though, things are very calm in HK.
Protests still happening, that has impacted trade more that COVID-19. Companies are starting to run out of cash and certain industries are suffering.
Minus 30% in sales because of COVID-19, projects on hold but some confidence that they will return as soon as restrictions are lifted.
Everything has stopped just the “special services” since 16th of March till 26 of April. Including school. If you go out for example in the supermarket you need an official document with you, if not they will penalize you.
No activities from the government in place to support companies, just short time allowance. Many companies are asking for credits to survive and maintain their liquidity. Of course, business angels are looking now for the big deal.
Maybe there will be after lockdown some opportunities regarding restructuring projects and cost saving programmes depending on the supply chain and end customers. The car industry will downsize and complete business and many suppliers will not survive or will need to close their facilities in Spain
A huge wave of economic problems could be coming for Spain
Everything has stopped for the last 6 weeks, full lockdown is in place. Most current work is M&A related, investors are preparing to catch cheap opportunities which is bringing in work.
Restructuring work continues in middle sized businesses. Predicting a L shape (recovery), services businesses will be hit hard, international travel is increasingly been viewed as unnecessary. Food, tourism and agrochemical will be hit hard in Italy.
Italians are expecting a second wave of COVID-19 in the Summer. Could be in lockdown for schools until September.
Going through difficult phase the same as the rest of Europe, they are in lockdown. This will be until at least 28 April 2020.
Most assignments are cancelled / postponed, this is due to uncertainty and not knowing when / if things will return to ‘normal’, decision makers are waiting. Current assignments are not effected as the Interim Managers are working from home.
Hearing that the management consultancies are busy, especially in health industries with existing clients.
The perfect storm of major uncertainty with COVID-19 and the IR35 legislative change, combined it has impacted private sector Interim Management work by up to 95%. Now that the IR35 implementation date has been extended to April 2021 we expect an increase in workload once businesses can see an end to COVID-19.
Our focus is on Quarter 3 with organisations starting to feel the restrictions imposed by lenders. Key skills will be restructuring, working capital in general, new strategies for a new world, disposal of non-core assets, more relaxed working from home policies.
Czech Republic and Slovakia
Restrictions in place and will be for another 2-4 weeks. COVID-19 numbers are not that high which is encouraging, they are starting to plateau. Most work is on hold although companies are starting to prepare for when the lockdown ends.
Lockdown still in place. Belgium was prepared very well from a health infrastructure perspective. Government is supporting well, for companies and Interim Managers. New work is coming in but reduced, many decisions are not being made by leadership teams.
Government is starting to relax the lockdown, some shops are due to open next week, schools are expected to deliver A levels with pupils in school.
Tourism will be impacted, government is asking all residents to refrain from traveling in 2020 regardless of the COVID-19 situation in that country.
Forecasting, budgeting, cash management skills will be required at some point, however no actions are being taken by companies presently.
In full lockdown, it is changing (consumer-, communication-, work-) behaviours. Government are supporting companies and individuals in a very generous way. That may give Germany (and Europe?) a debt crisis in a couple of years’ time.
Some assignments are still running, although most have now finished or on hold. Forecast for the next three months is expected to be quiet. Increase in business is expected in August / September, this will be around restructuring and function leadership. Predicting a U-shape (recovery) with a strong upstroke second half 2020 and full 2021.
COVID-19 increasing at pace. Florida is just over the peak – still in lockdown. Most work is consulting in nature, some manufacturing companies are bringing in people to increase outputs, it is taking out of the box thinking where Reese and the USA office has specific strengths.
Tourism and travel is being hit hard, especially Miami and Florida (Cruise ships).
USA is positive, they cant wait to get back to work.