There is no way to tell exactly what the economic damage from the global COVID-19 will be. However early estimates indicate that most economies will lose at least 2.4 percent of their gross domestic product per capita (GDP) during 2020. Leading economists forecast a decrease in 2020 in global GDP of around 8 percent.
In fact, the Coronavirus outbreak hit the whole global economy. Many enterprises temporarily shut or slowed down their activities and they still have to pay employee salaries and rents during the suspension of work.
To mitigate the impacts of COVID-19 in social and economic contexts, some executive heads has to come up with creative strategies to effective tackle this crisis. As a great place to start, they identified market needs right now, and the way that their enterprise could give an answer to the present situation. The main tasks and goals consisted of using a variety of resources to find new ways to link suppliers, partnerships, customers and employees together. Though they use their workforce, several ways of external support and leverage their employees’ talents to face riskreduction plans through new strategies. In Portugal, many companies were obliged to stop their activities by government orders, nevertheless others were themselves obliged to change their business in order to survive or reduce the impacts of COVID19.
Fan 3D, an example of a recent engineering consulting firm, has created a network to print visors. Actually, they use their knowledge and resources to create protective visors for healthcare professionals who are working in hospitals. According to Eurico Assunção, professor of the Instituto Superior Técnico (IST), executive vice-president of the European Welding Federation and head of this company: “As they say, “the occasion makes the thief”.
“HOWEVER, HERE THE PROFIT IS NOT MONEY, WHICH THEY DO NOT RECEIVE, IT IS HELP.”
At the Centre for Excellence and Innovation in the Automobile Industry (CEiiA), there is a team committed to create a prototype of ventilator to be produced in Portugal. As Tiago Rebelo, director of engineering, said “We’re not making the best ventilator in the world, we’re doing our best to respond a problem quickly and effectively”.
A group of micro brewers provide sanitizers when Hugo Santos, from Cerveja Chica, spoke to a GNR military who explained that they were out of products to clean and disinfect police stations and cars. ” (…) all of us brewers use diluted Peracetic Acid which can also be used in the cleaning of operating rooms” Diogo Trindade, from Lindinha Lucas.
Other examples could be used to illustrate this scenario, a textile industry changed its production to produce masks and gowns, a shoe industry produces masks and visors, Super Bock and Distilaria Levira changed temporarily from beverages to disinfectant gel.
The consensus among health professionals seems to be that depending on worldwide responses, the best-case scenario has us looking at a couple of months of mass social distancing and quarantine. The worst-case scenario suggests it could be closer to a year. At any rate, companies that hope to withstand the storm and possibly find useful innovations in order to provide creative answers, should be attentive to market requests, remain vigilant, fluid, and open with their intentions as they move forward.
Article published in our April Newsletter
Inês Catalão, BSc in Economics