Abstract
The COVID-19 pandemic is an unprecedented global crisis affecting the worldwide socio-economy. Many SMEs have ceased operations due to various obstacles during the pandemic period. The chapter identifies challenges faced by SMEs, specifically in Malaysia. The chapter also proposes that having a sustainable business solution protects SMEs from experiencing a crisis by diluting the impact of the pandemic and the critical challenges related to the financial impact, supply chain disruption, changing customer behavior, and evolving business environment. Post-lockdown, SMEs must revisit, realign, and implement practical operating procedures to stay relevant. Moving forward, SMEs depend on reliable and proactive leadership in revamping some of their business strategies – strengthening financial position, supply chain management, digital transformation, and organizational agility. SMEs must be vigilant and operate within the sustainable business framework involving the environmental, social, and governance (ESG). Consequently, this will fulfill the United Nations' sustainable development goals.
TopBackground
The World Health Organisation (WHO) had on 11th March 2020, declared the novel coronavirus or Covid-19 outbreak a global pandemic. Since the detection of the first pneumonia case caused by Covid-19 at the end of 2019, this disease has spread widely to 220 countries, with a total number of 87,672,854 cases. The incidences include 1,892,072 deaths and 63,157,432 recoveries (worldometers.info/coronavirus/ as of 7th January 2021). The number of Covid-19 infections worldwide continues to rise and has brought a serious impact on socio-economic globally. The World Bank, in its June 2020 Global Economic Prospects forecasting the global economy to shrink by 5.2% in 2020 due to the Covid-19 pandemic. Malaysia recorded its first Covid-19 case on 11th March 2020. The number of new confirmed cases dropped to a single digit in July and August but spiked to over 100 in September and over 1,000 in October 2020. The number of active cases, which rose at a faster pace, has gone up to 128,465, with 521 deaths and 102,723 recoveries (http://covid-19.moh.gov.my/ as of 7th January 2021).
Key Terms in this Chapter
COVID-19: An infectious disease caused by a newly discovered strain of coronavirus, a type of virus known to cause respiratory infections in humans.
Transformational Leadership: Refers to a leader who could move people beyond self-interest through idealised influence, inspiration, intellectual stimulation, or individualised consideration. The transformational leader engages, inspires, and motivates employees to be creative, envision the future scenarios for the organisations, leading to improved teamwork and business performance.
Government Financial Assistance: Government initiatives in providing financial aids in assisting the recipients to overcome financial difficulties or implementing specific targeted projects. This financial assistance can be extended in the form of cash pay-out, subsidies, grants, or credit guarantees, among others.
Digital Transformation: Integration of technologies across business functions and processes in enhancing operational efficiency that leads to improved organisational values and customer experience.
Sustainable Development Goals (SDGs): Refer to the shared blueprint for peace and prosperity for people and the planet. This blueprint was adopted by all United Nations member states in 2015 to achieve a better and more sustainable future for all.
New Normal: New routines or way of life due to changes brought by the COVID-19 pandemic.
Business Sustainability: Relates to the creation of long-term value within a business by taking adequate measures in ensuring the processes, products, and manufacturing activities are operated well within an ecological, social and economic environment while maintaining a profit.
Supply Chain Management: A structured effort to effectively manage the active integration and coordination of activities along the supply chain in ensuring the smooth flow of goods and services.
Small and Medium Enterprises (SMEs): Businesses that are smallish by capital, business turnover, and the number of employees, and operate in various industries. The quantum of each criterion varies by countries globally.