The leadership practices that helped us survive as business ground to a halt

In the past two months, a lot has changed for Pathao. Overnight, our rides business dropped to zero and food orders went down by more than half. To extend our runway, we had to conduct salary cuts as big as 80%, and nearly all marketing spending were put on hold.

Photo credit: Benjamin Child

In this situation, it’s expected for company morale to hit rock bottom. But somehow, that hasn’t been the case for us. In fact, in the last few months, the team has launched five new product verticals, which together make up 70% of our current revenue.

Here are the leadership practices that helped us cope with and survive the downturn.

The lockdown

To curb the spread of the Covid-19 virus, Bangladesh imposed a nationwide lockdown on March 25, which was initially set for a couple of weeks. But after monitoring other markets, we anticipated that it would last for much longer and that recovery wouldn’t be immediate.

The reality turned out to be largely in line with our predictions: Our rides business, which represents a sizable portion of our transaction volume, was at a complete standstill. Food orders were down by 70% in the first week alone.

We knew that our balance sheet would become hugely lopsided, but we didn’t know for how long. We needed to take action to preserve cash and extend our runway.

Prior to the pandemic, the company had already been running promotions to grow its food business. But when the crisis hit, we immediately cut marketing spending – though not all of it. It was still a means for gaining market share, and we didn’t want to rule that out.

That left us with the elephant in the room: payroll expenses.

Salaries were our biggest operating expense, which is both good and bad news: Good news because it’s within our locus of control, but bad news since it meant tough decisions and sacrifices.

Here are some of the actions we took that worked for us.

1. Acting early and being decisive

Two weeks into the lockdown, we announced the implementation of progressive pay cuts throughout the company.

This meant that the hardest hit would be those with higher salaries so that lower-paid employees would be protected and job cuts could be avoided.

We were already running a lean team when the lockdown was imposed, after reducing our headcount by 50% over the past year; we didn’t think that layoffs would be productive.

2. Telling the truth

3. Charting a course, creating purpose

4. Forging partnerships, building momentum