Discovering the Consequences of the COVID-19 Crisis on Management Practices in Organizations: Challenges and Forecasting for a Sustainable Future

Dear Colleagues,

At the end of 2019, Wuhan, China, witnessed the beginning of what will probably be remembered as one of the most significant events of the 21st century, i.e., so-called Covid-19 (coronavirus), which first rapidly spread to all provinces, municipalities, and autonomous regions in China and then to the rest of the world. Following from the assessment of the WHO (World Health Organization) and declaration of Covid-19 as a pandemic on 11 March 2020, as well as due to its suggestion “to take urgent and aggressive action” (WHO, 2020) to reduce the spread of the virus, the governments of the countries affected by the virus have started to adopt containment measures (and related procedures), reaching (almost) total restrictions on movement (of people and goods) and imposing strict limitations on the private sector (commercial and production of non-essential goods and services) and providing more flexibility in terms of public activities, including smart work (working from home). Despite all these efforts, however, the effects of this pandemic in terms of diffusion and impact on human losses are almost equivalent to those of a war.

While the consequences of Covid-19’s are still ongoing, also the impact of the related protective measures taken by different countries is beginning to show on local and global economic systems.

Many countries have already reduced and, in many cases, entirely closed economic activities and industries—for example, industrial activities for non-primary goods and the service, hospitality, and tourism sectors, which will face turbulent times in the near future not just to return to normal but, even more importantly, to survive.

As a result, starting from February 2020, we have witnessed heavy market swings, the price of oil falling and airlines dropping their prices or even collapsing due to falling demand, and car sales falling sharply (80% down in China)^[1]. In relation to the tourism industry, this crisis has totally changed the main topic of discussion, which used to be the problem of “over-tourism” but is now “down-tourism”. Finally, at least 70% of the sectors from which the world’s GDP is produced are undergoing record contractions.

Unlike in 2007, though, this is not a financial crisis—this is a health crisis in which the strongest factor is human behavior, or distance. As a direct result of calls for social distancing among humans and staying at home, people are neither producing (supply) nor purchasing (demand) goods and services, so most revenue—with the exception of state aid—has collapsed. It is looking extremely likely that once all this is over, many countries will face a recession, and we are also anticipating a deceleration of global annual growth to below 2.5% (UNCTAD, 2020)^[2]. In order to stimulate and fight the economic effects of Covid-19, many governments are announcing nonconventional packages with investments of millions and trillions of € and $ (and other respective currencies).

The pandemic from COVID-19 (coronavirus) “has disrupted people’s life and the global economy” (Boone, 2020)^[3], and “people are shutting down their businesses” (Stiglitz, 2020). The Nobel Prof. Stiglitz claims that this crisis will be harder than any we have faced before or what some economists have predicted and suggests some ways to reduce the effects. However, “this is a different kind of crisis than normal crises” (Stiglitz, 2020), and “more demand is not going to save that particular problem” (ibidem). According to Stiglitz, this is not a financial crisis but a crisis that involves the supply and demand system.

The current challenges for the organizations operating under the Covid-19 crisis involve identifying the threats and opportunities emerging from this unprecedented situation and visualizing their potential role in the future in terms of viability and competitive advantage.

This crisis raises important empirical questions for scholars at all levels of management and stimulates the need to better understand the cause–effect relation between what immediate problems Covid-19 has created and what potential future impact they could have. A main question around this relationship refers to the type of consequences of the crisis, which can be either immediate or long-term, and the level of impact, which can be both tangible and intangible. The consequences can be related both to the theoretical and empirical aspects. From a theoretical point of view, the main question can be: How can we make the most of previous theories and models (via contextualizing) to face this crisis? From an empirical point of view, by contrast: How can we make the most of previous empirical experiences (lesson learning/contextualizing) to understand possible exit strategies? When approaching the economic and managerial problems of the near future, we really should not make the same mistakes as those that generated this crisis or underestimate the problems. Differently from health crises in the distant past, today uncertainty can be addressed using managing knowledge also through the use of technology (e.g., Internet of Things, big data).

According to this evidence, the aim of this Special Issue is to stimulate awareness of the future problems that Covid-19 might bring to the management arena and to give an opportunity to business management scholars to provide new insights into dealing with this crisis. Furthermore, the scope of this Special Issue is to create the foundations of managerial knowledge around this topic to better deal with future issues emerging from the Covid-19 crisis. 

[1] INFODATA Il Sole 24 Ore, 2020, Quale sarà l’impatto del coronavirus sull’economia mondiale? Le stime e gli scenari formulati fino ad adesso, Il Sole 24 Ore, from https://www.infodata.ilsole24ore.com/2020/03/22/quale-sara-limpatto-del-coronavirus-sulleconomia-mondiale-le-stime-gli-scenari-formulati-ad-adesso/.

[2] UNCTAD, 2020, The coronavirus shock: a story of another global crisis foretold and what policymakers should be doing about it, code UNCTAD/GDS/INF/2020/1, 9 march, retrieved from https://unctad.org/en/PublicationsLibrary/gds_tdr2019_update_coronavirus.pdf.

[3] Boone, L. 2020. Coronavirus: the world economy at risk, Interim Report, OECD Economic Outlook, March, 2020. Retrieved from http://www.oecd.org/economic-outlook/. Accessed on 25/03/2020. 

Dr. Gian Luca Casali
Dr. Mirko Perano
Guest Editors

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