Covid-19 : 3 Things To Consider As An Economic Development Agency

Covid-19 : 3 Things To Consider As An Economic Development Agency

March 31st, 2020

by Ian Smith

There is little doubt that Covid-19 or coronavirus will leave a huge impact on society as a whole when the level of infection is under control.   The virus has placed a tremendous strain on each country’s healthcare systems and economy not to mention the stress on one’s person life.

In the hopes of “flattening the curve”, many individuals wait until some normalcy can return.   For economic development organizations, it is a question of time of when the greenlight will be given for individuals to get back to work and kickstart the economy,

Given the unfortunate pause due to the pandemic, executives at economic development agencies must take the time to take stock of what has happened in their respective regions, province or state and around the globe in terms of economic activity and how it has been affected.

Here are three observations that I have made since the first case of Covid-19 was announced in Canada.   The observations may seem quite elementary, however; I wish to offer them as food for thought for those who need a reference point to begin a strategic planning exercise by themselves or with others.

i) Supply chain management in some industries is very fragile but flexible

We all had a good chuckle when there were countless amount of videos and photos of people rushing out to buy toilet paper.  “Panic shopping” placed a pressure on retailers to ensure that there was enough product on the selves to meet the increased and unexpected demand from consumers.   Such strain on the supply chain caused each member in the chain to operate differently.  For example, the supply chain management for “Kraft Dinner” (also known as “KD”) in Canada experience a surged in demand thanks to the “stay at home” recommendation by the federal and provincial government.  Kraft Dinner is an instant macaroni and cheese product that is comfort food for some.  As a result, supermarkets saw their selves barely stocked with the product.  To sure up the supply chain, Kraft Canada has plans to increase production in their plant in Montreal in order to operate 24 hours per day.  One option that was taken to get more of the product in the chain is to forgo the product of other Kraft offerings to make room for the assembly of the finish product (a box of dried elbow macaroni and a packet of grated cheese).

Agencies must be in tune with manufacturers that are key players in their supply chain.   Not only in a time of an emergency, agencies should be informed on how efficient the chain is in various industries.  As seen in the Kraft Canada case, there might be an opportunity to discuss plans to expand the plant and increase the workforce to meet the future demand for the product.

ii) Some companies are more agile than others

The calls for vital items needed to treat individuals with the virus in hospital were heeded by companies from across North American.  In terms of providing personal protective equipment, hockey equipment manufacturer, Bauer in Canada has stepped up to produce face shields for healthcare professionals on the front lines.   Baseball uniform producer, Fanatics, in the United States is using material usually dedicated to uniforms to manufacture gowns and masks,  Alcohol beverage producers in the United States and even the small island nation of Jamaica have decided to mass produce sanitizer solution to stem the spread of the virus.  Rum producer, J. Wray and Nephew is now donating bottles of pure alcohol to serve as an alternative to hand sanitizer.

These are prime examples of companies which are agile enough to use raw products to make completely different goods to fulfill a great need in the marketplace.  Economic development agencies should consider compiling a list of agile companies like Fanatics, Bauer and J. Wray and Nephew to seek out opportunities to manufacturer products from their core product.  As a result, companies can identify other sources of revenues which will be linked to job creation if they can be competitive in the new market segment.

iii) Tourism related sectors must be willing to innovate 

One of the most hard-hit sector by Covid-19 is tourism and related industries (i.e., hotel, taxi, bars and restaurants).  Looking ahead, entities in these sectors will have to deal with individuals being uncertain in terms of being in large groups in confine spaces and places where proper hygiene is essential.  

The foremost thing that these entities must do is to be innovative in terms of re-engaging their clientele at the present time in order for them to return when life gets back to normal after the coronavirus outbreak.   One of the online strategies that nightclubs are doing is hosting dancing parties on various social media platforms where users can livestream audio and video.

To enable these entities to be innovative, economic development agencies must make all the tools available to market tourism-based attractions and related services. 

There is not a doubt that financial assistance will be available, however; innovation and proven attraction strategies and advice must be available as soon as possible.

For the months and years to come, there will be a variety of economic development strategies in place to aid the recovery from Covid-19.  It is important to note that economic development agencies should take a strategic approach based on past successes and current and potential opportunities that might arise during this difficult time.