Denis Brisebois
Vice President | Tourism-Leisure-Culture | Management consulting

The tourism sector has been hard hit by the pandemic and the next few months will inevitably bring challenges and transformation.

As with any major crisis in any sector, the key to a successful, rapid and sustainable recovery is the industry’s or business’s ability to seize new opportunities.

Asses repercussions

Before delving into the heart of the matter, let’s look at a few statistics to measure the repercussions of the pandemic on Quebec tourism and to show the importance of taking action:

  • 400,000 people laid off, including the restaurant sector;
  • $2.6B in lost revenue due to the absence of foreign travellers in 2020;
  • $1B in lost hotel rental income in Montréal and Québec City;
  • 9.8% occupancy in downtown Montréal hotels in July 2020 compared to 83.5% in July 2019.

Transportation, events, conventions and restaurants were the most affected, with the impact being greater in urban areas.

Nevertheless, some sectors fared a little better: for example, campgrounds, where the average occupancy rate increased by 10.1% during the 2020 summer season, and sectors with a focus on outdoor activities, like agri-tourism, golf, hunting, fishing, and large parks.

Analyze positioning

To better understand the positioning of tourism businesses in the crisis and their internal capacity to recover, we have developed a two-axis analysis matrix:

  1. Entity’s key abilities;
  2. Entity’s key environment-related factors.

1- The five key business abilities to emerge from the crisis are:

  • Financial and organizational health;
  • Management team and board of directors;
  • Relationship with business partners;
  • Digital capability;
  • Development vision.

2- The three key environment-related factors that define the crisis and the recovery are:

  • Urban or rural location;
  • Group or individual consumption;
  • Clientele from outside or inside Quebec; younger or older clientele.

Analyzing these conditions determines the organization’s position in terms of its ability to recover and the type of strategy to be implemented.

Identify main challenges

Two areas will be put to the test:

Human and operational resources

1- Offsetting the workforce shortage

The industry is facing a severe workforce shortage. The sector’s vulnerability is causing many employees to change careers and consequently, businesses are losing expertise. As a result, they will have to turn to a range of new solutions for recruiting and retaining workers.

Internally, pooling functions should not be overlooked. The versatility of roles within the organization is a must to get through this crisis period, as is mobilizing the team.

2- Accelerating digital transformation to improve productivity

The tourism sector was lagging behind in terms of digital transformation. The pandemic has exposed the need for organizations to accelerate this transformation in order to adapt to users’ new needs and improve their productivity.

Financial component

As for the financial aspect, the financial assistance measures introduced since the beginning of the crisis have made it possible for many businesses to survive. There have been fewer closures than initially estimated.

However, it has been a long pandemic that has significantly impacted organization’s finances. Discussions with bankers, investors and business partners make it possible for entities to find new options to keep their business afloat.

Choose a tailored solution

Having stabilized and kept the business afloat over the past year, management must now chart a new course for recovery. There are several options:

  • Diversify and foster the growth of new or traditional activities;
  • Refocus activities on the essentials and restore profitability;
  • Transform or reinvent the business;
  • Or even sell, to get the maximum value for the business.

No matter what direction organizations take, they will need a healthy dose of courage and conviction. Efficient management will be critical. You will need to be agile, creative and equip themselves with the necessary tools and skills to help the organization adapt to the new reality.

This unprecedented crisis will trigger significant changes in the tourism sector, and while some businesses may not recover, others will emerge stronger. There are real opportunities to be discovered or even triggered between now and the full re-launch of operations. One thing is certain, the industry will evolve more sustainably and will recover its vitality in the years to come.

Our tourism, recreation and culture team is committed to the success of organizations and keeps abreast of evolving issues in this sector. Our experts are there to guide and support you in analyzing your needs, accessing available financial measures and providing relevant solutions for your business.

08 Jun 2021  |  Written by :

Denis Brisebois is a management consulting expert and leader in tourism, leisure and culture....

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The Grant Thornton International IFRS team has published the 2021 version of its IFRS Example Interim Consolidated Financial Statements.

The IFRS Example interim consolidated financial statements 2021 have been reviewed and updated to reflect changes in IAS 34 Interim Financial Reporting and in other IFRS that are effective for the year ending December 31, 2021 and that have been issued prior to April 30, 2021.

In addition, given that the global COVID-19 pandemic continues to impact many reporting entities that exist, the 2021 interim version provides comments on information that might be relevant to disclose around the COVID-19 in the interim financial statements.

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Valérie Verdoni
Senior Director | CPA, CA

Many mid-market companies are redeveloping their international ambitions after having scaled back during the pandemic.

As shown in the latest figures from Grant Thornton’s research, conducted between October and December 2020, more companies are deciding to shift their focus towards international markets in their post-pandemic strategic plan. This global trend is important as it highlights game-changing opportunities internationally for all mid-market companies and Canadian businesses are seizing up this occasion in the market to grow.

Changes in the market leads to a boost in entrepreneurialism

Before the pandemic, many compagnies across Canada were active internationally and growing their market worldwide as part of a pre-existing plan. However, the recent economic and market changes have opened doors for many more Canadian compagnies to speed up their plans as a direct result of COVID-19. In fact, the latest figures from Grant Thornton’s latest research reveals that 20% say that they only started to increase their focus on international markets since the outbreak of the pandemic.

Additionally, significantly more Canadian mid-market companies (24% in H2 2020 vs 15% in H1 2020) are now expecting to increase their ratio of employees focussed on international markets in the next 12 months. This renewed appetite among the mid-market, even as the pandemic lingers, perhaps best demonstrates the sort of entrepreneurialism we have here in Canada.

Abundant sales opportunities are drawing companies abroad

The re-embracing of international sales is likely to be very significant in positioning the mid-market for growth during and beyond the pandemic and is a reminder of a key characteristic of our businesses. This shows how they are able to see the trends and opportunities in the marketplace and then adapt quickly to take advantage of them.

Below we show how COVID-19 has impacted those increasing their international sales focus. Competitive changes are a key theme here, with 48% mentioning the opportunity to form new international relationships due to the departure or failure of competitors. Another 39% mention the lower levels of competition in international markets, underscoring the competitive disruptions and shake-out from COVID-19.

COVID-19 factors contributing towards international focus according to entrepreneurs:

  • Opportunity to form new international relationships from the recent departure/failure of competitors: 47.5% of businesses;
  • Lower levels of competition in international markets due to COVID-19: 39.3% of businesses;
  • It has become easier to take products or services internationally: 37.7% of businesses;
  • Stimulation of international demand due to COVID-19: 32.8% of businesses;
  • Internationalisation of your supply chain making overseas markets more accessibles: 29.5% of businesses;
  • Sales disruption in your domestic markets from COVID-19: 26.2% of businesses;
  • Beneficial government stimulus programs in international markets due to COVID-19: 24.6% of businesses;
  • None of the above: 6.6% of businesses.

The other major incentive is customer demand, with 33% seeing stimulation of international demand due to COVID-19 and 25% mentioning the positive benefits of government stimulus programs. With positive indications on both the customer and competitor side, it’s easy to see why another 38% say it is now easier to take products and services international. Although other factors like the rise of digital communication will also be at work here.

A once in a generation opportunity to grow internationally

All of this data points to what we think is a once in a generation opportunity to grow business internationally, and one that all mid-market leaders should be aware of. As in any gold rush, it pays to think before joining the rush. Our leaders stress the importance of being strategic in your decision-making. We encourage businesses to identify where they will have the most impact. Furthermore, the importance of looking beyond the immediate and thinking about the medium and long-term goals, with clear priorities and action plans that are also backed up by scenario planning, to support resilience.

For those companies wanting to exploit these opportunities will need to be both growth ready as well as agile. Our team of experts, along with our international solution offer can help you conquer new frontiers.

04 Jun 2021  |  Written by :

Valérie Verdoni is a senior manager at Raymond Chabot Grant Thornton for business and strategy...

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There is increasing talk of diversity and inclusion (DI) policies in the workplace. But what impact do these policies have on your organization and how do you go about integrating them?

Diversity and inclusion management in business is defined as the attraction and management of practices that promote the inclusion of women, Aboriginal peoples, different cultural communities, people with disabilities, LGBTQ+ community, experienced workers and people from disadvantaged backgrounds. However, these practices are still not understood by many companies today. Progress toward greater diversity and inclusion, particularly gender parity in senior management, has moved more slowly over the past decade than it should (ref. Women in Business 2021). And while there is greater participation, higher levels of education, and comparable qualifications in 2021, diversity groups are still underrepresented in business and have higher rates of unemployment. Career paths are more difficult and there is still underrepresentation in various functions within organizations (Saba, T. 2019).

Unfortunately, the pandemic has amplified this phenomenon because the cultural and gender diversity in sectors that are doing the best (technology, manufacturing, mining and metals, construction) and those that are in the basic service sector (health, food retail, pharmacy) is mostly homogeneous. Conversely, the forced stoppages in the restaurant, tourism and accommodation sectors, or constraints of telecommuting and school and daycare closures have had a greater impact on women and minorities. As a result, Quebec now has a majority of women and minorities among its unemployed. A diversity and inclusion policy in the workplace is therefore necessary for the survival of companies, not to mention all the other benefits that come with it.

The benefits of integrating a DI policy

According to a study of diversity in the workplace (OECD, 2018, 2020), the reasons for companies to embrace diversity are reportedly to enrich their human capital (67%), stimulate creativity and innovation (46%), address ethical considerations (43%), address labour and skill shortages (37%), and meet legal obligations (37%).

The impact of greater gender diversity within a company is even greater than we might think. Diversity of ideas is linked to better decision-making, better risk management and better financial performance of companies. (Isidro and Sobral; 2015) According to Christine Regimbal, Partner and Head of Diversity and Inclusion at Raymond Chabot Grant Thornton, “There are numerous benefits to a diversified and inclusive corporate culture, starting with a greater potential for innovation and an increased sense of belonging.”

While there may be a strong and genuine intention to make your organization diverse and inclusive, just talking about it or writing it into a policy does not make it a practice. And like any new policy or process, it’s best to start with a realistic plan and clear goals and then define the practices to be implemented.

Diversity and inclusion management best practices

We suggest an eight-step approach based on best practices to help you prepare for the implementation of a DI management initiative in your organization.

Step 1 – Management’s commitment

The first step is to ensure that the organization’s leaders are committed to diversity and inclusion. Ideally, members of management will draft the policy and identify initiatives. A practice leader will then be appointed to ensure implementation and dissemination of key information to all groups within the company.

Step 2 – Set up a committee

The next step is to set up a DI advisory committee or management committee in the organization.

Step 3 – Budget and monitoring

You will need to allocate a specific budget to manage and implement your DI practises. You should identify and implement monitoring and performance indicators related to the DI program, for example: number of women managers/total number of managers; number of visible minority managers/total number of managers; and so on.

Step 4 – Training

There are DI courses available for different levels of managers and employees. Various topics are covered, such as unconscious bias, intuitive practices and reflexes, ingrained preconceptions, employee evaluations, etc.

Step 5 –Programs

You will then need to integrate various programs that promote diversity and inclusion, such as a career management or leadership program.

Step 6 – Procedure review and adjustment

Over time, your organization developed numerous human resource management policies and procedures that will need to be reviewed and adjusted to reflect the new DI management approach.

Step 7 – Mentoring and networking

To create a sense of belonging and attraction that will generate a feeling of social security in your workplace, encourage your teams through diversity mentoring and networking.

Step 8 – Internal survey

Lastly, an internal survey is a good way to determine whether your various approaches are successful and ascertain the change in practices, observe adaptations to standards and procedures and gather employee feedback.

To complement this process, foster relationships with vendors who advocate DI management practices in the workplace.

Efforts must be continued and measured for more than five years in order to properly implement this new organizational culture and to see the results of these changes.

Adapt current policies to support DI management

Since a business is a self-contained system, it is important to review all management practices, especially internal human resource management policies. Many of the policies implemented in companies do not necessarily contribute to better DI management. Some of these should be given greater attention.

Recruiting policy

For example, review gender neutral job postings, consider postings on targeted networks and anonymous CV recruiting, use employee photos showing diversity in promotional campaigns or on the corporate website.

New employee onboarding and training

For example, include diverse members in corporate presentations and training for new employees, promote the development of inclusive practices among current employees.

Succession and career management policy or practices

For example, ensure that unconscious stereotype biases are avoided in performance management practices, potential assessments, identification of management succession candidates and identification of critical jobs and profiles sought for their staffing.

Work/personal life reconciliation policy and cultural holidays

For example, ensure multicultural representation in the company’s practices, without generating favoritism and by respecting internal equity and organizational integrity.

We now encourage you to take a step back and look at the makeup of your executive committee and board of directors. Ask yourself how you could optimize their membership and promote diversity? Never underestimate the strength of a multicultural, multi-gender and multi-generational team, both in the search for solutions and its impact on the organization’s performance.

Take it one step at a time, and don’t hesitate to consult our experts to integrate a structured approach to promote diversity management within your entity.