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How Alan Jope runs Unilever in times of Coronavirus

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How Alan Jope runs Unilever in times of Coronavirus

Once a pandemic dons the devil’s cape, you know it’s time to shut all doors and lock yourself in. So, on March 13th, when the rapidly spreading Coronavirus took the shape of a pandemic from a mere outbreak, Alan Jope ordered his office workers from all countries barring China to work from home. But even as the CEO of Unilever, a renowned consumer-goods multinational, sent around 60,000 workers back home, Alan believed everything to be in good shape by the end of Coronavirus.

Unilever gears up to battle the crisis

But all is not okay for Unilever, a brand known for the consumer staples it creates - from Dove and Lifebuoy soap to Knorr soup and Lipton tea. While the demand for hygiene products has stepped up considerably pertaining to the ongoing crisis, other products that earlier found a steady place in consumer shelves are no longer in constant demand. The struggle is real, even for giant conglomerates like Unilever who are striving to meet the needs of 2.5 billion customers in 190 countries.

So, when the pandemic took a toll on businesses around the globe, Alan Jope took a train ticket to Edinburgh and joined his family. And as the world battled a disease outdoors, he breathed a sigh of relief, receded to his study and started working from home. His colleagues were safe, home as was he. To quote Alan, “remote working is easy”. The absence of daily commute had made it simpler for him to connect and coordinate with his workmates.

With a sudden shift in the demand curve, the pandemic has had a severe impact on consumption, production and the generation of profit, going as far as changing the nature of top jobs for most firms. Where bosses were earlier identified with strategic minds, they now have to step into the pool to consider various parameters to make a decision. And this is the difference COVID-19 has brought to Alan’s life as well. But amidst the current wave of threat of Coronavirus, here is how the much-celebrated boss of Unilever is treading.

1. Safeguarding the Workforce

Following the very first of his principles, Alan believes that the safety and well-being of his workers - both physical and financial, is of paramount importance. In that regard, the office staff of Unilever has been sent home. To prevent the further spread of coronavirus, factories have been operating on “Fort Knox mode”. Sales teams virtually contact and connect with customers. Besides that, Unilever has pledged to maintain pay levels for all its direct and contractual employees for up to three months.

2. Maintaining Production levels

Another immediate concern for Unilever was to not let the production stop. But where Italy and China acted as laboratories, situations especially got rough when authorities ordered the ban of lorry transit. Later, when companies alerted the countries about the potential shortage of basic supplies, the order had to be relaxed. So far, the company hasn’t come across disruptions in food supplies and basic necessities from packaging firms or farmers at the base of the supply chain. But a major bottleneck in numerous places has appeared in the form of a dearth in the number of lorry drivers.

3. Consumers are urged to shop less

In times of chaos, panic buying comes into the picture, leading to a wavering consumption pattern. In countries like America and Europe, shelves from various shops have been stripped off essential items, mostly in supermarkets. Whereas, people in developing countries huddle at nearby shops for basic necessities. This flickering demand in various places amidst Coronavirus has turned the monthly sales of Unilever into weekly ones and the stats are unsteady. But the organisation is keeping up to meet the demands of consumers.

4. Keeping a check on cash flow

In matters of cash, Unilever has been in decent shape with a moderate debt. While it registered up to 52 billion euros in the last year sales, it had around 6.1 billion euros in free cash flow, even in the time of corporate cash crunch. Backing it up over the past decade, Unilever has been robust with suppliers and is among the eight big conglomerates that have witnessed a rise in their median sales from 9% in the 2000s to that of 16% last year.

Alan is all set to give this back though as the firm decided to extend 500 million euros of cash flow to customers and suppliers. It will speed up payments to small and medium-sized retailers and offer credit to the small vendors that particularly rely on Unilever. Alan also emphasized on the fact that if many more such organisations expedite payments to their suppliers, it would release financial pressure off the shoulders of small vendors.

In an unsettled, rapidly changing landscape, the supply and demand patterns are ambiguous. Even though the sales of a few products might shoot up owing to panic buying, self-isolating customers will shop less, thus affecting the production and distribution markets of major conglomerates.

But where extraordinary times need groundbreaking solutions, Alan Jope is all suited up in his armour beside Unilever to fight the Coronavirus. And as these major conglomerates take charge of their swords and fight their way through the ongoing havoc, we can all pray and hope that they stay safe and this dreaded disease evaporates into thin air soon.

Edited by

D2C Admin

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