Summer greetings from the Business Forward team!
As this unusual academic year comes to an end, we reflect on a journey of ideas, analysis and learnings that Business Forward had gone through since the outbreak of COVID-19.
On a chilly mid-March day and an almost empty campus that still had traces of rainfall from the previous storm that hit the city, we released our first COVID19-related article on how workplaces can quickly apply tips to control the spread of the novel virus, at the top of which was, according to Dr. Heba Barakat of the American University in Cairo’s (AUC) School of Business Executive Education healthcare program, “washing hands. Any sick people should refrain from coming to the workplace.”
By that time, on-campus learning had been suspended and staff members were still alternating remote and office working as a measure to control the spread of the disease. On March 19, we left Business Forward’s newsroom on the second floor of the Abdul Latif Jameel Hall where the AUC School of Business lies, not knowing it will be the last time for months ahead.
We shortly realized that the game-changing global pandemic will have the biggest say in Business Forward’s editorial planning for months to follow. Our content developed from newly created home-based work spaces, amidst Zoom calls, WhatsApp exchanges, webinar series, internet connectivity challenges, and was mostly focused on different angles of how leadership thinking, economic sectors and business education were responding to this exceptional situation.
The economy perspective
The impact of the lockdown around the world was on top of everybody’s thoughts. Insights from Professor of Economics at the AUC School of Business, Tarek Selim, complemented by the at-the-time viral infographic by Dcode for Economic and Financial Consulting gave us a preview of how the economic impact was to unfold over the next few months. IT and digital business and capital-intensive industries held on well, as opposed to labor-intensive sectors and those centered around people services. The government stimulus package and several debt relaxation provisions helped mitigate the effect of the slowdown of economic activity.
However, incentive packages and financial instruments could not work alone. To strategically position the sectors that had high potential in performing well, industrial development expert Alaa Fahmy stressed the importance of setting clear and specific development targets, finding out their needs in terms of talent and infrastructure, which will both add up to a clear development vision for them.
Among the opportunities Abla Abdel-Latif, executive director of the Egyptian Center for Economic Studies, sees is the export sector as the only source of foreign exchange, and a key driver of economic recovery.
Amidst the turmoil, Egypt received stable credit ratings, that should be treated with caution as they are based on unconfirmed assumptions. Egypt was shielded by certain factors such as the large informal sector and low household and corporate debt, as it faced a slowdown in its vital sources of income, according to Angus Blair, professor of practice at the AUC School of Business management department. European demand on natural gas presents an opportunity for Egypt as it prepares to expand exports in that area.
The informal sector of Egypt has historically held its own in previous crises because of its flexibility in filling in demand gaps. While the services sector has been severely hit, informal workers in sectors such as agriculture have also played a crucial part in keeping the wheels rolling. Contributing at least 30 percent of GDP, the informal labor market was worth dissecting further with a human-centered lens, looking at the interventions in place to support those whose livelihoods were affected by COVID-19.
Market and sector perspective
When people rushed to stock up on gloves, masks and sanitizers at the beginning of the outbreak, their surging prices were a widely discussed concern, with suppliers allegedly taking advantage of the supply and demand situation. The way forward, Angus Blair believes, is for governments to encourage the private sector to contribute more of its efforts to changing their production cycles to meet demand in times of unprecedented crisis. Panic buying continued for a while. Lisa Ellram, professor of supply chain management at Miami University, argues that businesses along the supply chain should “try to hold their prices, increasing them only to cover their increased costs related to more expensive shipping, overtime and premiums they have to pay for supply. They should stick with selling to their current customers first.” Sherwat Elwan, associate professor of operation management at the AUC School of Business, foresees how the disruption will encourage firms to dig deeper into knowing exactly where their products are coming from and to assess sub-tiers in their supply chains to identify weaknesses.
Relying on recent studies by the ECES and interviewing industry experts, we looked into several sectors. Food retail saw a boom during the COVID-19 crisis with small retailers being at a disadvantage. Naturally, textiles were badly hit with the slowdown of retail activity, but there was a good opportunity in quickly shifting production to medical masks and gowns. Before COVID-19, the tourism sector was expected to achieve $16.7 billion of revenue by the end of 2019/2020. Following the severe hit, the sector is expected to benefit from the unavoidable, albeit risky, gradual re-opening of hotels and hospitality activities.
Our attention was also caught by the hundreds of billboards sitting empty for several months over streets much quieter than usual. Out-of-Homes (OOH) advertising agencies Business Forward contacted talked about diversifying into other means of advertising such as social media, and lowering profit margins to keep the EGP 6 billion sector going.
On financial inclusion, despite efforts to steer Egypt towards a cashless economy, it still lags behind similar countries. With more fintech apps on the scene and COVID-19 driving both consumers and businesses to be more open to cashless transactions, change might be happening. And on that note, CIB Chairman Hisham Ezz El-Arab also exclusively shared with us how COVID-19 presented a valuable opportunity to the biggest private bank in Egypt, while also discussing the background behind the first cross-border acquisition for Egypt’s biggest private bank.
The firm perspective
In the early days of the crisis, we were impressed by various businesses and organizations who quickly adopted solutions for business continuity – sometimes on a smaller scale – demonstrating an understanding for customer needs and agile decision-making. From senior shopping hour to various uses of online meeting solutions and apps, Business Forward shed light on eight interesting examples.
The COVID-19 situation tested the creativity of marketeers to communicate their corporate message with empathy. “Crisis communication usually incorporates the classic three T’s: transparency, truthfulness, and timeliness. Today, however, companies need to add another dimension, being emotional. Empathy and humanity rule the day,” said Hamed Shamma, associate professor of Marketing and BP Endowed Chair at AUC School of Business.
Among the tips in his article “The COVID-19 Communication Brandbook,” Ahmed Tolba, associate provost for Strategic Enrollment Management, and associate professor of Marketing at The American University in Cairo (AUC), stresses the importance of firms being attentive to changing dynamics and shifting consumer behaviors and adapting to them.
To make the most of the global experiment of remote working, encourage people to work together to address work obstacles and embrace a growth mindset rather than a fixed one, says Somaya El Sherbini, co-founder of Right Foot Solutions. Remote working is a paradigm shift that opens opportunities for employers and employees but has its complications. “As we experiment, agile and frequent feedback cycles are key to be able to recognize what is not working and changing it fast. Finally, great leadership to be able to manage it all, is the make-it-or-break-it of this setup,” advises human capital expert Nermine Fawzy, co-founder of FosterEdge.
Lessons for business leadership
“Never fear experimentation”, tells us renowned business minds Alex Osterwalder and Yves Pigneur, authors of the book “The Invincible Company“ further elaborating that the most adventurous companies are very resilient to disruptions such as new technologies, changing markets and even to global paradigm shifts such as the COVID-19 pandemic.
The business education ecosystem is by no means immune to the shock and the changes it has brought to teaching and learning, the wealth of case studies for business education and research, the approach to emergency preparedness and the accreditation criteria for higher education institutions, writes Ahmed Abdel-Meguid, associate professor of Accounting and associate dean at the AUC School of Business, in a contribution to Business Forward that was later re-published by EFMD and the International Leadership Association.
“Online education was already challenging traditional in-person courses and this pandemic has definitely provided ample opportunity for all of us to innovate our pedagogy, course content and assessments but also how we think of and design education. In fact, crises accelerate and accentuate what is already about to happen,” reflects Chief Strategy Officer at HULT International Business School, Johan Roos.
Next to their missions to educate and foster research, universities have a ‘third mission’ to play in societal challenges, writes youth employment expert Amal Mowafy in her opinion piece that re-appeared in EFMD’s global blog, recommending optimizing decision making at higher education institutions through integrated ‘nerve centers’ that “move beyond the confines of the university, consulting all community members”.
It’s not always about COVID-19
We were mindful that the pandemic might have brought new challenges for women professionals around the world due to the lockdown of schools and day-care facilities. So we provided a series of inspiring stories of women ‘parentpreneurs’ that we launched on International Women’s Day. Results from the Women on Boards Observatory (WoB) report and new partnerships showed some promising results for women’s representation in business leadership and gender equity, amidst persistent challenges, however.
Our exclusive interviews on the sidelines of the AUC Business Forum presented a series of bite-sized perspectives from renowned regional and global industry experts and academics on issues such as entrepreneurship, data science, access to knowledge, trade competitiveness and the future of business education. Artificial Intelligence, an inescapable reality for markets and business planning, was addressed in detail in an interview conducted by the AUC’s Access to Knowledge for Development Center (A2K4D).
Amidst the COVID-19 turmoil, we did not forget to highlight the risk of inaction on climate change with the specific example of Egypt’s North Coast, as well as shedding light on efforts to promote Micro-, Small and Medium Enterprises (MSMEs), occupational health and safety and a story of how a Syrian-owned catering business created its place in a competitive market.
To a more hopeful academic year
Over the summer, Business Forward will continue to produce timely and informative articles, videos and stories with ideas, information and insights for business leadership, as we continue to explore the impact of one of the biggest global reckonings of our times.
Wishing all our readers a bright, safe and peaceful summer despite all the uncertainties, and a more hopeful September.
Sincerely,
Ghada Nadi
Managing Editor
Moustafa Daly
Senior Editor
Tareq Abobakr Selim
Journalist
Have thoughts related to one of our focus areas: corporate finance, responsible business, economic development, innovation and technology management, entrepreneurship and family business that you feel an urge to write about? Get in touch with Business Forward’s editorial team on businessforward@aucegypt.edu
