The Virtual Existence Conundrum: PT 2 – poison pill defence.

In the hostile takeover business there is this thing called The Poison Pill Defence, where the target company usually comes up with a plan to thwart the hostile takeover. Whats happening now is very similar, except this isn’t a corporate game, its become a simple matter of survival! So when the magnitude of this “thing” finally manifested, au naturalle, everyone cut back = Poison Pill Defence. Cut back spending on just about on every possible bogey on the radar.

Picking up from where I left off in Part 1, this piece is about the impact on Business. Though I initially thought to make this one about People, I reasoned that adversity affecting Businesses and the Economy in general, is the very source for the unprecedented angst, anxiety and uncertainity in the minds of people and therefore reversed the order of release (watch out for the People issues in Part 3 in this series).

That Economies are in dire straits is now a well established fact and its also clear that initial forecasts fell short of realities now emerging. India seems to be leading the charge, what with a 23% drop in GDP, Britain and France following closely and other leading countries in the double digits.

Let’s look at the recently published numbers and compare them to initial forecasts from back in March’20 or thereabouts. The World Bank forecast a contraction of 5.2 % for 2020, predicting a shrinking by 7% of advanced economies and emerging and developing economies shrinking by 2.5%. The latest Q2 numbers in the infographic below provide strong indication that the period end numbers will be far worse than the initial forecasts. There is some debate and discussion on how the published numbers should be interpreted, but whichever way one chooses to interpret, the situation is far worse than was earlier guaged.

Economies are all about the Green or whatever colour paper or plastic your currency notes are printed on. Printed? Think surface contamination! Now think, contactless, paperless. Think DIGITAL! A completely different paradigm. Interesting though, as Chris Skinner, an authority on FinTech and Digital opines, Digital is just 1 – 2% done and these estimates are Pre-Covid. Meaning what exactly? Simply this, that the need to accelerate digital has gone up by a factor of 10? 100?

Looking at the big names who have gone almost bust, we see that those having a strong digital presense are the ones who are weathering the storm (not the teacup variety) much better that others. Despite that this thrust for Digital is no longer something that can be relegated to a future date, decision making has slowed, budgets have been slashed, cashflows seem not to permit investments despite the clear need. And then there is the fact that Digital encompasses a relook and rethink from the ground up and that presents a challenge when you can’t get all in the same room at once.

And then we have China, putting out numbers that suggest that it is unaffected? Go figure! Whats more? There is a whistleblower virologist who claims that this virus is man made, that it was already spreading was a given and did naught to act in time and supressed the facts. If indeed this is the reality isn’t this nothing short of mass genocide and akin to war crimes?

Of course her claims are being disputed by all concerned parties (naturally), but Dr. Li-Meng Yan promised to release incontrovertial evidence. Let’s see how that pans out, but let’s keep in mind that China still posts numbers that are contrarian to the global decline in GDP! So what seems to have insulated China? Are the numbers even real?

It’s been one hairy ride thus far and there’s no saying how much longer this lasts. Think mutation, think community spread, think “we’re all going to get it” kinda magnitude or so they say. But hopefully we will all have developed immunity by the time it hits those who have not yet been affected.

In the hostile takeover business there is this thing called “The Poison Pill Defence”, where the target company usually comes up with a plan to thwart the hostile takeover. Whats happening now is very similar, except this isn’t a corporate game, its become a very matter of survival! So when the magnitude of this “thing” finally manifested, au naturalle, everyone cut back = Poison Pill Defence. Cut back spending on just about on every possible bogey on the radar.

What do the people upstairs do when faced with looming reversals? Business ain’t growing so increasing renevues is not a viable option, but cutting cost is. Typically the cost centre’s that go under the lamp are People Costs, Travel Costs, Real Estate, Benefits, Incentives, Variable Comp and carrying cost of inventories. Three main approaches? Either you look at the pecking order and start high (I’ve been at the receiving end of this in a past life and barely survived), or then you look at the bottom of the pyramid and lay off enmasse or then you do a bit of both. Travel costs went out the window anyway and did save up oodles of cash. Business continuity was maintained on the backbone of digital communication channels (look out for my article covering this all important lifeline).

Laying people off, salary freezes, salary deferments, pulling out of projects and such measures were frowned upon by many industry stalwarts (all well intended I’m sure) on every channel, social, professional, the tube, print and online. I however have a nagging question now and indeed had this nagging question then.

Most of the comments, opinions and the preaching from the pulpit kinda advise not to lay off etc came from as I said, industry stalwarts and perhaps they have the luxury to say these things. But what about smaller companies? Ones that do not have deep pockets, who have not had the opportunity to shore up cash and build contingency reserves? What about startups? If I’m not mistaken, startups don’t have much more than 3-6 months of a runway (depending on what stage they are in) AND now by the by there is this business downturn…. So many startups are in the quick app space, relying on downloads and mass market usage for their survival (and the potential of obscene valuations if the idea sells to the deep pockets). Don’t forget the statistic that 80% or so of startups fail and now this! Startups that were frugal, kept their cost base and ops costs minimalist will have longer runways and have so much more of a chance to weather this, but even they will look to be even more minimalist at times like this. Poison Pill Defence again.

Governments, Organizations, both big and small, as well as solely owned businesses are the ones generating employment. So isn’t it better to do the cost containment measures and ensure survival, albeit with a sustainable resource base, as opposed to letting the whole thing go Kaput? I mean how many companies or for that matter governments have pockets that deep, that they carry on as if nothing happened? Organizations can’t possibly raise funds nor increase revenue. Governments can’t rely on increasing tax revenue nor increase the tax rate. Banks can lend, as some banks are doing aggressively, but what about when its time to collect? What about the NPAs and delinquincy rates as incomes dwindle?

See the graphic from my previous post, where I’ve made an attempt to depict the domino effect, so I won’t go on about it here…

Will not “the greater common good” approach rule the roost? It’s war as I said in my earlier article, nary a bullet fired. Well maybe it was engineered as this whistleblower seems to suggest and if that’s the case then that is something completely different.

Chanakya Pandit (Circa 321–297 BCE), a renowned Brahmin (not a popular thing in India these days, to say you’re a Brahmin), thinker, philosopher, political genius (Author of Chanakya Niti), guru and kingmaker (seems I’m from his lineage – no jokes) asked Chandragupta Maurya (the King he made), What is the FIRST DUTY of a King? Everyone I ask, almost everyone, says things like, take care of his subjects, protect his subjects, create wealth, be just and so on. Hell no! That’s NOT it at all. The FIRST and FOREMOST duty of a King is to guard his throne. No throne, no subjects and no subjects means the King can’t do squat!

Similarly, Organisations need to survive, ie: they need to take care of themselves first, so therefore the cutbacks, layoffs and so on. In war, innocents fall by the wayside and we are in a war, innit? So either live to fight another day or then go out with a bang! There it is! Take your pick.

We want to sit safely in our comfortable homes, watching Netflix and Prime, ordering takeaway and yet we are sending Doctors, healthworkers and others who keep the lights on for us, our networks up and running, out into battle DAY IN AND DAY OUT? We want our farmers out in the fields sowing and harvesting while we don’t want to step out.

I have this really cose friend, a Doctor. She doesn’t have the CHOICE to stay safe. She’s been commandeered! If she wants to stay safe she looses her licence to practice. So you see the dilemma? Throw away years of hard work, experience, knowledge and a lot of cash invested in med school fees, or show up to save others! Simple choice, its BINARY. She’s no less than a hero or heroine, she’s an Avenger, no less, fighting Thanos. Doctors are being given targets I hear and in Mysore a Doctor committed suicide, alledgedly due to this.

Some of us? All we want is our Veggies and then there are others who still want their luxuries. We want to order online (Digital is great is it not?) from the saftey of our homes. We want people to show up for work so we can be serviced with no inconvenience. There is a real person at the end of the last mile. We need those people to save lives and treat patients, we need those people to produce our luxuries and conveniences, we need those people to fuel the food industry and we need people to deliver stuff to us safely. We can’t teleport stuff from the shop floor or for that matter the farm, to our homes and neither will our groceries and staples materialize before us, at least not yet!

  1. Lockdowns, both local and international as the numbers are now tellin’ us, created the first wave and entire industries Travel and Tourism, the Restaurant Business, the Airline Industry, were all hit.
  2. The next wave took out the supply chain, supplying to and feeding off those industries.
  3. The third wave set in when cash became scarce and the cascading impact of the cutbacks came into our homes compelling many to curb spending and only take care of essentials. That took out the fashion and glamour and so many such industries.
  4. The next BIG one is Real Estate, so when we figured that WFH and Remote Working is something that can be made to outlast temporary BCP Ops, Real Estate suddenly became a pariah. There you have it, another one bites the dust!

Not all businesses can be run remotely, nor can all services be rendered remotely, with some needing that physical contact, yet physical contact is taboo. This is further amplified when we’re taking about countries who still have a largely agrarian economic model and support structure purely based on cash for daily livelyhoods.

Of course the long term sustainability of 100% remote working, even if theoretically within the realm of possibility, remains to be seen, not just in terms of practicality, support and operational models, but also in terms of impact on people, families relationships. That’s the hidden impact not often forming part of the math (coming up in the next part).

The Global Economy cannot just shut down and even if COVID does not dissapate as quickly as we’d like or just disappear like a bad dream, businesses that did not die completely will pick thmselves up, morph, adapt and start working under a new set of rules, a new set of realities, albeit fraught with risks. Money needs to start flowing again, people need to work to earn and survive. Mouths need feeding, students need to continue learning.

As I said in Part 1, Business Models are rapidly polarizing depending how big the ship is….sooo much harder to get a BIG ship to turn around. Economic Models are changing, the way we do business is changing and in cases have already changed a while ago. The fundamentals may not have changed a lot but, everything around the fundamentals has changed and perhaps in some cases the fundamentals too! The old rules need a serious dose of refresh. Read more about this in an interesting article on Management Theories, here is the link:

Therefore we’re seeing lockdowns being lifted, curbs on travel are being relaxed and this is really the worst possible Catch 22. Damned if you do – Damned if you don’t! Poison Pill Defence once again. The numbers don’t lie. Harsh realities need to be faced, risks will need to be taken and we will all need to move on, stop living in fear, remain cautious and take every possible precaution, BUT STOP living in fear.

The Virtual Existence Conundrum – Part 1: Shall We Level-set?

From absolute lockdown to a gradual lifting of the lockdown, from closing offices and workplaces to gradually reopening offices and workplaces, from absolute mobility restrictions, closing of international and even local borders, mandatory and voluntary quarantine, Governments and Organizations have been challenged like never before and no matter what measures are contemplated, no matter what the narratives are and no matter what steps they take, they will nevery be truly appreciated.

Disclaimer: This is intended to be a series. I tend to be opinionated and make propositions, suggestions, half in jest and some not so much in jest. Therefore, proceed at your own risk! Hopefully at the end of the series I may have covered several pertinent aspects of what we as Humans are dealing with, what businesses are dealing with, what Governments are dealing with and that should just about cover the Social, Family, Personal, Economic & Financial impact of something unprecedented hitherto.

Let’s say we begin with the initial rehtoric when the Pandemic was recognized as one and reality began to set it. Essentially, popular opinions gravitated towards a series of abstractions driven by the usual sets of people. The naysayers, the yesayers, those in the know, those in denial (arguably the optimists), the optimists (myself included) and the ones that are usually swayed by popular opinion that suits their pshyche best.

  • The Virus is man made and originated in China at some reasearch or bio-weapons facility in Wuhan. Whatever, but we’re up the creek and no paddle.
  • The world has changed. Yay!!!
  • The Pandemic is a way to tell mankind that it has abused the planet and the planet is now healing. Right, we’re all stone deaf or soon will be.
  • The oceans, rivers, air are less polluted, say the very people who polluted them in the first place. Go figure!
  • People have adopted healthier lifestyles. Not much else to do in the first place, so no pat on the back here, but perhaps I should be kinder.
  • It will take us years to recover and be back to normal. We really have no way of knowing what that “normal” may end up as.
The Virus is man made: Not even getting into that despite my own convications on the subject and a lot in the public and not so public domains.

The World has changed: No extra points for that astute observation.

Note to Mankind - "You've abused Mother Nature": Note taken but will be ignored shortly after things ease up. You see, we have short memories and its always SEP - Sombody Elses Problem, what can I do anyway?

Less Pollution is a Fact: Reality IS less polluted, but ONLY because the smokestacks have stopped spewing temporarily, planes aren't really flying as much, cars arent out that much. So unless we expect to move all polluting means of transport and production to non-polluting ones immediately, its going to be BAU - Business As Usual right after. Alternatively we go back to animals moving us and things around (here come the PETA - Prevention of Cruelty To Animals activists). Let's go back to ships with sails, or take up Cycling to Work en masse (I did it for years in Bombay - 18 km each day each way), so I've done my bit and until this day don't own a car. So let's do snail mail, the bullock-cart, the horse-drawn carriage, the mule train, oxen and bulls to till fields (still widely prevalent in India) A rapid slowing down of trade, provision of services.

The ONLY thing that will actually be spared is this whole Digital thingy (deserving, demanding and crying out for a seperate chapter in this serices).

Healthier Lifestyles: Would that be because bars, clubs, pubs, restaurants and all our usual watering holes are shut? Is it a choice or is it just because we’re all sitting around with limited mobility and naught else to occupy our time? Sustainable? Theoretically - yes, Hopefully - BIG YES, Practically - I’m not so sure. What happened in Bombay, the day the lockdown was lifted? Thousands of people took to the Marine Drive Promenade. Social distancing be damned! So I can’t possibly be blamed for being a bit of a sceptic.
Wai, Wai, Wai or well, well, well (Turkish, influenced by a recently devoured Netflix series). We do have a rather interesting and intimidating set of dilemmas, so perhaps you get why Conundrum?

All said and done what we have at hand is a radically changed on-ground reality and a scratching of heads to figure out how the Digital will co-exist with the Physical going forward and the cognoscenti are calling it "Phygital". The ever expanding English language, you see.

People are figuring out what the long term impact of limited or no mobility will be, as are Organizations, Governments and NGO's.

Our very concept of growth is in question. Growth means expanding beyond borders and everyone is cosing ranks as we speak. Buy Made in USA, Make in India are but two inititives that threaten the Global Economy by encouraging local businesses.

The Pandemic has taken that a few steps further and now we have "Hyper-local", or buisness in the immediate hinterland. Maybe we should even look at good ole barter-trade once again.
The initial reactions, at least in my mind, was, “Storm in a Teacup”. Was I way off the mark! That was one bad prediction!

The initial numbers weren’t alarming and then it all came down like a pack of cards, the Domino chips fell, Italy and petty soon it was all over. India started slowly but in a couple of months, the spate and acceleration got scary as heck. That seems to be the state across the globe, with some countries seemingly locked in a downward spiral.

When this all began, I for one, never imagined that it would span these many months. I brushed it away and indeed underestimated the extent of the chaos Covid would end up causing. It took time to sink in. This was a full blown Pandemic of global proportions and the way it seems we haven’t really seen the bottom of the pit yet.


Reactions at organizations and by Governments, when the magnitude or real threat perceptions were borne out by the sheer numbers? Concern, mild panic, followed by disbelief, followed by acute panic, followed by seemingly draconian measures and all the troubles and woes that accompany such measures real and perceived.

In the absence of a cure or a vaccicine, Social Distancing seemed to be the only viable alternative. Let infected people stay put and not expose ones not infected and so it all began. Did it really help? Arguably yes, but with the whole Community Spread angle, I’m not so sure.

Heads – I Win Tails – You Loose

From absolute lockdown to a gradual lifting of the lockdown, from closing offices and workplaces to gradually reopening offices and workplaces, from absolute mobility restrictions, closing of international and even local borders, mandatory and voluntary quarantine, Governments and Organizations have been challenged like never before and no matter what measures are contemplated, no matter what the narratives are and no matter what steps they take, they will never be truly appreciated.

Healthcare is another area that’s been caught totally off balance! No healthcare system or processes were ever designed to deal with the kind of testing that’s needed, nor were they designed to quarantine the numbers needing it. Then there’s the whole vaccine issue. Speeding up trials yes, coming up with a vaccine that does the trick yes, but what about distribution and administering the vaccine? How about monitoring post vaccination? Surely a vaccine that’s thrown together and taken the fast-track route to administration with minimal clinical trials will need to be monitored closely? What about side effects. That’s another conundrum right there! A lot of questions and few answers.

Communication and tools used to communicate have suddenly come to the forefront like never before to overcome the setbacks on travel and

There has been no calamity quite like this, no challenge encountered like this, so there are no reference points or any precedents to follow. The wise old men can’t really add value by way of advise and its just trial and error.

How long should we lockdown for? How long is long or what is too short? At what point will be be choking the economy and affecting ability to earn a wage. What will be the impact on the general populace? No easy decisons, certainly no popular decisions. The “greater common good” despite being in the best interests of all, aren’t seen as such and the view tends to be very myopic.

Humans, by nature forget easily the good thats done and instead tend to focus on the measures taken, the ones that restrict freedoms of movement, speech and actions. Political considerations, profit and economic motivations of Governments and Organizations have an impact on their decisions. These decisions tend to be unpopular.

In my opinion, it is a big ask to expect people who at the bottom end of the food chain to think about the planet, when their very existence and that of their families are at stake. No bailout plan is quite sufficient to address this group of people. A bailout plan or support plan or stimulus package, whatever label we end up giving such plans, devoid of fundamental principles is tantamount to deficit financing and deficit financing at a global level is tantamount to disaster of epic proportions.

If we’re able to recall macroeconomics from when we were students back in the day? M1, M2, M3 and the concept of Money Supply? Pretty simple this equation, no rocket science here.

I would love to be proved wrong and all fronts, BUT am I holding my breath? Heck, the air is cleaner, why should I?

Speaking of predictions, I don’t seem to have seen people quote Nostradamous quartrains, as they often do whenever there is some sort of a calamity. Unless I’ve altogether missed any references to them on the usual channels.

The “New Normal” is such an understatement! Perhaps the Understatement of the century, almost like a falsehood along the lines of “The Earth is Flat” changing to “The Earth is Curved” to “Hell no, the Earth is Round”. A falsehood not by design, but restricted by what we can observe and experience and learn as we continue our battle against the virus. As we understand more about COVID and diseases in general, these falsehoods will be turned on their heads. Look at what we were told and what really happened. The “New Normal” deserves, demands and warrants special mention and therefore one piece in this series is dedicated to “The New Normal”.

But for now let’s deal with some falsehoods that were quickly turned on their heads and then look at some published facts.

  • That the virus would affect only people over a certain age.
  • That the Virus is unlikely to survive warm and hot climates and surfaces.

So here are the facts from the WHO and as you see this list, if you’re anything like me, you’re bound to be rolling your eyes with the stuff they need to put out! One in particular really cracked me up, “Fact: Drinking Ethanol, Methanol or Bleach DOES NOT cure Covid19 and can be dangerous”.

Covid 19 – Facts from WHO

In ending this piece, YES the World has changed and even though we can’t really fathom where this will all end up, what our lives will be like going forward, when this will all go away, will it all go away and so on….one thing is pretty darn clear, the World suffered a scare, its still afraid, precautions must and can be taken. YES, people have adopted better lifestyles, if only out of sheer boredom, but I’d hope people do adopt the healther lifestyles as a way of life and make conscious choices, be the choices be about diet, fitness, pollution, work life balance, live not just for the moment but bear in mind that nothing can be taken for granted. Not your paycheck, your source of income, not even your ability to be mobile as we were accustomed to in the very recent past.

The way we conduct ourselves and indeed expect and demand how those around us conduct themselves is all different now. Let’s be safe, take all precautions and keep others safe and urge them to take precautions.

It is then time to be more considerate, more compassionate, look kindly and help those not as fortunate as some of us. When you spend frivolously, think of the people struggling and in despair.

On pain of death or worse yet, a life accursed by the ones who are suffering, DO NOT go out and buy the USD 100/- odd Louis Vuitton facemask!!!

Business Models are polarizing, moving from physical to digital, online is thriving, travel, leisure and entertainment is reeling. And yet whereas the digital is the first mile, in more cases than not, digital alone cannot complete the circle, the last mile must be physical. “Future Proof” has taken on new meaning, those who didn’t envision the future have fallen by the wayside, whilst others are morphing and new models emerging, sustainable ones. Some big names are gone, some others are struggling. People are being let go, employers are being mercenary whereas others are being fair and considerate.

Our People skills are under the severest test we’ve every experienced. Isolation, WFH – Work From Hone, Confinement, Solitary or with loved or not so loved ones, all present their own set of challenges. Shaking hands – NO, Coughing – NO, Feel a Sneeze Coming up – NO!!! People are showing their true colors, fear of the unknown and uncertainity is driving less than desirable behaviour, yet, there are people who rise to the occasion, above all odds and got out of their way to help. YES, humankind is being subjected to its harshest test yet.

The next couple of pieces (may end up more than just a couple) in the series will cover People, Society, Economy & Finance, Organizations, the Frontline Workers. Everything about COVID 19 is interconnected , everything is relevant and everything is a big mystery.

From The Outlaw Josie Wales:

Lone Watie:
“I wore this frock coat in Washington, before the war. We wore them because we belonged to the five civilized tribes. We dressed ourselves up like Abraham Lincoln. We only got to see the Secretary of the Interior, and he said: “Boy! You boys sure look civilized.!” he congratulated us and gave us medals for looking so civilized. We told him about how our land had been stolen and our people were dying. When we finished he shook our hands and said, “endeavor to persevere!” They stood us in a line: John Jumper, Chili McIntosh, Buffalo Hump, Jim Buckmark, and me — I am Lone Watie. They took our pictures. And the newspapers said, “Indians vow to endeavor to persevere.
“We thought about it for a long time, “Endeavor to persevere.” And when we had thought about it long enough, we declared war on the Union.”

We are in a war, it is a World War and yet not a single bullet has been fired.

Stay Safe in the War on Covid and help those frontline fighters, by ourselves fighting it, leading from the front.

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