When the Covid-19 pandemic hit the world, there was just a few companies what were prepared and ready for it. Even the most cautious business has been hit hard by the pandemic. However, as time passes we are witnessing that some companies are emerging stronger from the pandemic and its intense turmoil. Even in downturns like the current Covid-19 we are currently experiencing, companies run by cautious leaders can survive and even get ready for the next big shocks. In this article we will talk about 3 principles on how you can manage your company in a crisis.
Fight the Current Crisis and Search for the Next
Strategic executives give attention to uncertainty in several developing horizons. While in the moment they are firefighting by taking care of their people, suppliers, customers and resources, they still look ahead. This requires an innovative and analytical company structure. Despite the recession, the digital transformation of businesses will keep rising. The pandemic is also providing a huge boost to remote health-care management, although almost all organizations are seeking to work as efficiently as possible. Here are a few general questions which should be raised by cautious leaders to go beyond the present crisis.
- What are the major risks on the horizon? Which scenarios can management create to catch them in combination?
- What strategic decisions can the company take to evolve as a leader in the industry? How stable are these movements in any scenario?
- Do we now have opportunistic moves to make — takeovers, market entries or exits? Or which ones, as alternatives, can we tackle flexibly?
- Will we change the distribution of our capital to innovation? Where do we search for new prospects and how do we take advantage of the right ones in front of rivals?
- What new leadership talents and management expertise are required to prepare the company for the longer term?
Turbulence = Opportunity
Systematically, proactive companies can cultivate diverse skills that promote resilience and readiness. Typically, common environments can be navigated with ordinary skills based on skillful execution of existing operations, such as supply chain management, regular transactions and consistent efficiency. However, if you need to tackle deep uncertainty, businesses may need a much more cautious toolkit built to three dynamic capabilities: detecting change faster than competitors, seizing opportunities quickly and reshaping the company to stay ahead.
With the right collection of dynamic skills, an enterprise can stay agile when volatility is strong. agility means being able to react rapidly and move resources sooner than the competitors to higher-value tasks. For instance, Intuit has developed a small group, a scrum, to investigate why their new online transaction system Mint has drawn unexpected clients. The scrum realized quickly that gig economy employees like Uber or Lyft drivers considered their commodity efficient, and so the company specially designed a version for them. Scrums act as teams that organize themselves, adopt a consistent framework, use design thinking techniques to evaluate new ideas, and easily learn. These qualities are the opposite of bureaucratic, top-down systems with daily sessions, static command structures and other barriers to action.
Pace Is Imperative
Vigilant companies cultivate a different velocity outlook than traditional businesses, namely when the time comes to be available. Pace will remain a highly valuable creed particularly in the coronavirus pandemic. Delays appear to limit the spectrum of possible strategy alternatives, since someone else can get to them sooner. Seeing earlier also gives more time for diligent companies to build flexible options to be enforced later.
But because business clock whirls quicker does not really mean leaders need to work in hurry. Moving quicker than competitors is all about being ready for action when appropriate, and this begins with early detection and understanding by the C-suite posing questions, accompanied by exploratory forays to market. Superior foresight tends to provide more degrees of freedom when swift or daring acts are needed, without getting locked in by the gestures of rivals.
Get ready for the Game
Vigilant organizations have multiple eyes and ears to monitor the entire world, and are thus well equipped to handle mega-shocks such as coronavirus. Companies like Agilent, Intuit, Sysco, and Amazon have developed the right alignment of leadership, economic capital, strategic expertise, and corporate skills to exploit new markets ahead of their more fragile rivals. Organizational watchfulness is a common skill defined by enthusiasm, sincerity and openness to different inputs. That is the antithesis to myopia, siloed reasoning and being left captive by traditional wisdom that is outdated. Our own analysis indicates that 4 strategic factors emerge from the stability of proactive companies in difficult times:
- The dedication of leadership to resilience is illustrated by an exposure to inadequate messages from a range of sources, allowing others to discuss problems beyond their scope — thinking outside the box. The management team is strategically oriented and fosters enthusiasm around the whole enterprise, allowing the corporation to modify its internal processes and strategic relationships on a short notice.
- Foresight investments are made routinely, often by unified foresight systems, which monitor the perimeter while gathering internal signals as well. For starters, the supply chain feature will have dashboards that would display early alerts when external factors interrupt delivery on schedule. Instead of waiting to see if key problems will settle with time, a diligent company is proactively building a scalable range of solutions such that it can evaluate and respond efficiently as necessary.
- Strategy creation processes are scalable and resilient by both following an “outside-in” strategy and a “future-back” one. Outside-in-thought helps policymakers to have a greater perspective into their strategic partners’ shifting circumstances. They will make smarter decisions for joint gain by having to feel their pain later. Future-back thinking is about anticipating what sort of organizational change will be required once Covid-19 fades away. Leaders will use potential scenarios to determine which plants to seed now, while still alleviate some of their people, consumers and suppliers’ near-term pain.
- Coordination and transparency processes are correctly moored in well managed organizations, ensuring that knowledge is easily exchanged with those who really need it. The leadership team eliminates uncertainty in decision-making by marking and redressing unorganized operations and haphazard projects, which provides the right conditions for sustained accountability. For instance, as soon as early warning signs about the pandemic were identified, genuinely alert companies developed “plan ahead” groups to think of the future and analyze promising initiatives from around the business.
In the exceptional times of Covid-19, as a tiny, deadly epidemic takes everybody down, caution is still so much about reinventing and orchestrating stronger readiness for the next time around. This is not “readiness” in the traditional context of merely coming back and returning to life. Instead, vigilant organizations are asking: what can we be prepared to do as we return to a new standard?
Individual leaders and the C-suite in tandem will promote this kind of thought by raising questions such as: What do we benefit from the current turbulence and chaos? What do we need to do now to achieve a competitive advantage in the future? What are the corporate impediments to strengthening our resilience capabilities? What policy steps and reform measures do we initiate to bring us in a better position?
Vigilant leaders will build enough emotional space to brace themselves for the next shock, and there’ll be one.