Sharp CFO Moonsun Park shares the company’s plan to reopen its facilities.
The COVID-19 shutdown has been a trying time for businesses across the globe, particularly in major metropolitan areas, which have been hotspots for the virus. While some regions of the U.S. have reopened, others are taking a more prudent approach as they prepare to open in phases.
Recently, we spoke with Sharp CFO Moonsun Park about the company’s strategies for reopening to ensure the safety of its employees across all its locations.
As in most metropolitan areas, the closure was sudden when Sharp’s physical offices closed and employees started working remotely the week of March 16. That included its headquarters in Montvale, New Jersey and about 60 leased locations across the country. Some states, Washington and California had already been in lockdown.
As an essential business that supports other essential businesses, a small staff was maintained at each location throughout the lockdown. Since the middle of March, most of Sharp’s back-office employees have been working remotely.
The timing of the shutdown was particularly challenging at Sharp because it coincided with the end of its fiscal year, which concluded on March 31.
“It’s hard enough when we are in the office but doing it remotely was a challenge,” said Park who revealed that the company lost its tax director to COVID-19.
Despite that very difficult loss of a co-worker on top of having to work remotely, the team rose to the challenge.
The Path to Reopening
From the beginning, Sharp’s executive team understood that reopening the company for business would be more difficult than closing.
“We’ve been thinking about this pretty much since the day we closed down,” said Park.
Sharp’s facilities team, which Park also oversees, has worked tirelessly to think through just about everything related to opening to ensure that employees and customers are safe. Adjustments have been made to office layouts to create a safe and social distanced environment. For example, hallways will be one way, so people don’t have to pass each other. Stairways have been designated as either up or down. Cafeteria offerings will be limited to avoid handling of utensils. Sadly, employees will have to say goodbye to the salad bar for now as well as communal coffee pots. And employees will not be allowed to use the refrigerators in break rooms.
“The use and cleanliness over anything that people touch needs to be revisited and reviewed,” said Park. “It’s amazing to understand how much there is to think about within an office. The team has been looking at everything to ensure the safety of our employees.”
Park said the company will ease back towards the way they were once a cure is found or there is better and more available testing. Until then, safety rules.
“But whatever we’re doing at headquarters will be across the organization,” added Park. “Every employee will be treated the same.”
Park added that headquarters is more challenging because more people work there.
Company executives, including President & CEO Mike Marusic recently met virtually with branch general managers across the country to discuss how to handle employees returning to the office. As we’ve seen in the media, in certain states where the rate of infection hasn’t been as bad as the New York, New Jersey area, there is less concern.
“Mike wanted to make it a priority for the general managers to communicate that to their teams that we want to ensure safety across the board,” said Park.
A Phased Approach
Sharp is implementing a phased approach towards reopening. In the initial phases, at least in Montvale, where about 330 people work, about 10% of the team in Montvale, including management who report to Chairman Ted Kawamura will return. After that, Park and her team will evaluate how things progress, identify any issues, and then move onto the next phase. She anticipates up to 25% of Sharp’s employees will return to headquarters during this phase.
While this is happening, Park’s team will monitor three criteria related to the pandemic—deaths, local COVID-19-related hospitalizations, and the percentage of positive cases of total tested cases.
“As long as those are trending down, we’ll continue to move to the next phase,” she said. “If we see spikes, we’re either going to hold or move back a phase.”
The same approach will take place at the branch locations.
“It’s not like you turn on a light switch, and everyone’s back,” said Park.
Sharp’s three-phase approach has been designated red, yellow, and green to make things perfectly clear to employees.
For Further Consideration
Park and her team have had plenty to keep themselves busy during the past few months, including thinking about employees’ mental health and wellbeing as well as the challenges of working parents who may not have someone to watch their kids when they return to work because summer camps or schools are closed.
“We are looking at that on a person-by-person basis and making those exceptions to keep employees safe and productive,” said Park.
Travel within Sharp is also on hold, at least during the red and yellow phases other than on very rare exceptions. Those who need to travel will need management approval.
Cashflow Considerations
Park and Sharp management have been strategizing since January when things were heating up in China about how to respond to the pandemic should it impact the company’s cashflow.
“We are in a good cash position currently and in the near term, we have no issues,” revealed Park. “The biggest concern, obviously, is the future business.”
Park evaluates cashflow weekly and has run different projections to determine how to respond under different cashflow scenarios.
Like many of its competitors and dealers, business has been severely impacted. For example, Sharp Business Solutions, the company’s direct business, prints are down about 50%. At the peak of the downturn, it was down as much as 60%. Because of that, Sharp furloughed about 400 people, the majority from the direct side of the business. Many of those are service people who are unable to visit customers because businesses are closed.
Most of the company’s furloughed employees are expected back mid-July. Between now and then Sharp’s management team has been evaluating all costs, from building leases and bonus payouts to salary reductions and staff reductions. As of this week a decision was made to pay bonuses. So far, Sharp has not had to make any additional changes and has been able to pay bonuses on time.
On the channel side, Sharp continues to work closely with its dealers, supporting them anyway it can, including sending them masks to protect their employees as well as adjusting its dealer programs to compensate for the downturn in sales.
“We were reasonably well prepared for an unknown, but nobody could have known this was coming,” said Park about the closures and the downturn in business.
Being conservative and cutting costs as much as it could without sacrificing the business and ensuring that Sharp is in position to grow again when this is over has been a priority.
“I’d rather have extra cash and reserves to be able to use it than not have enough money,” said Park.
“We are working closely with all the business units to ensure that we continue to be in that positive cash position. We are looking at Sharp’s interests first and continuing to retain our employees. The last thing we want to do is lose the great team we have built.”
Of course, this situation has been a challenge for Park, but also a learning experience as she has been inspired by the camaraderie and team spirit of the management team who she is now working with in ways she never had in the past.
“It’s put all of my skills to the test and utilize skills that I never had to before,” she said. “There’s a saying that when the situation is the worst, that brings out the best in you.”
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