The Consequences of Bad Leadership During The COVID-19 Pandemic: An Agent-Based Model

In response to the COVID-19 pandemic, countries took serious measures to control its spread and reduce its effect on health, social, and economic aspects. The United Arab Emirates (UAE) has taken unprecedented preventive measures against the spread of COVID-19, including complete lockdowns and the closing of some businesses. Therefore, 27% of companies expected to lose their businesses within a month, while 43% of companies expected to go out of business within six months. This was not only due to the countrywide lockdown, or the impacts caused by the pandemic, but also due to the bad leadership of some leaders during this crisis. There are little of studies and data that discuss the consequences of these decisions on businesses, and it will be helpful to measure the consequences over three years. This study answers the following question: How much did myopic staffing and compensation decisions in the context of COVID-19 affect companies’ performance? To answer this question, I use agent-based modeling (ABM) supported by secondary data to create a simulation to study the consequences of myopic decisions made on employees’ performance in the private sector in the United Arab Emirates starting from the 2020 year and through an anticipated period of 3 years . The study found that under the assumptions that pay deductions, layoffs, and unpaid leaves, are myopic decisions and in the context of the COVID-19 pandemic and its impact on the companies’ performance, there is a huge affect on companies’ performance over the study period which is 3 years. Keywords: bad leadership, myopic decisions, companies, businesses, COVID-19, agent-based model.