Is it possible for organizations to leverage times of crisis as a strategic advantage? The answer is yes, according to Tom Devane, Vice President of the Energage Consulting Group, and co-author of The Change Handbook.
Leveraging a turbulent environment as a competitive advantage
For almost all organizations, the current environment is uncharted territory. But, with the right mindset and the right skills, there’s a great opportunity for growth and improvement. Consider this:
- We are in a very new and very different situation.
- The situation is so different that it calls for radically new rules for success.
- There is a great sense of urgency.
Combined, these three points represent a rare combination: the “need for speed” and greater acceptance of small failures. Both are important to organizations that want to discover and learn better ways of doing things. Yet, organizations tend to get stuck in the here and now – even the most successful ones.
Looking at this set of conditions, organizations have a unique opportunity to innovate their business model – and the employee experience too. With some extra effort, leaders can go beyond the typical knee-jerk reactions and temporary fixes. And those who can figure it out quickly will have an incredible advantage for growth on the other side of this crisis.
Four high-leverage areas for leaders to consider right now
Big organizational change always starts with leadership. So first, leaders need to evaluate and refine how they:
- Communicate with the organization.
- Stay connected – and keep their people connected.
- Motivate people in a remote environment.
- Plan for the rapidly changing future.
Leaders can address and improve their leadership style by crafting a unique approach to planning that incorporates strategies for the current, transition, and future states. After all, in the world of Lean Six Sigma and a tendency toward speed and efficiency, it’s better to kill multiple birds with one stone.
With any new approach, it’s imperative for organizational leaders to have a robust employee feedback system. This helps to confirm the organization is headed in the right direction, and it also provides an early-warning signal to indicate when a strategy pivot may be needed.
When planning for the future, here is where leaders get stuck
This, of course, depends on the current state of your business. If your building is on fire, go grab a hose. It’s not the time to be contemplating and drafting new architectural plans to make your business fireproof. It’s also not the time to lament over not having a fireproof building in the first place.
Experience tells us that human beings are quite good at adapting to a new environment. However, it also tells us we’re less adept at applying rigorous thought to future needs.
The majority of organizations have executed short-term adaptations in response to the COVID-19 crisis. The problem is, they’re still in that short-term planning and reaction mode. In other words, they haven’t shifted their thinking to a higher level. I’m talking about considering different timeframes, how performance variables will shift, or what actions they’ll need to take at each phase.
The basics of finding opportunities for growth in times of crisis
Think in terms of three different time frames: the current, the transition, and the future. Each time frame has a distinct set of characteristics. Each requires a change to the business model, how leaders lead, and how followers follow.
Keep in mind the organizational change principle: Powerful change begins with a question. The development of this question – or set of questions – should come from the CEO or senior leadership team. Frame the aspirations the organization is looking to achieve. This will guide how people should direct their knowledge and energy as they consider potential solutions.
Determine who should focus on planning ahead. Start by having conversations with individuals and trusted advisors. Also, look to industry groups or executive forums. The idea is to have a conversation and allow people to build on each other’s ideas.
Form an internal team dedicated to planning ahead
Form an internal team that’s dedicated to planning for each of the three time frames. The key is to assemble an enthusiastic, knowledgeable, and well-rounded set of people focused on this effort. And while it’s true larger companies can draw from a bigger pool of people, this approach is also effective for organizations with as few as 100 employees.
When building these teams, look for the following characteristics:
- Multidisciplinary backgrounds
- Different views of the customer and internal operations
- Futurist thinkers
Establish behaviors critical for remote working environments and select a team leader who:
- Excels at soliciting great ideas from others rather than providing all the answers.
- Recognizes – and capitalizes – on the expertise of others.
- Asks questions that dig deep rather than accepting everything at face value.
- Applauds team members for their contributions and extra effort.
- Leads the team to encourage diverse viewpoints and recommendations, especially from those who tend to be reserved.
- Considers smaller ideas and suggested pivots in addition to bigger-picture ideas.
Be careful the group isn’t so large that it’s difficult to operate, especially if the team is working remotely. We recommend limiting the team to between five and eight individuals. Set a regular cadence of one meeting per day (or every other day) until you can gauge how the group is progressing. And don’t forget to make it possible for individuals to set time aside to do research before coming back to the group to integrate the findings.
How teams should approach the current, transition, and future
Your business model and the employee experience are the two primary areas of concern. Start with a structured approach to make sure you’ve covered all of your bases. Consider the outside variables, such as supply and demand, as well as the connection of the two:
In terms of demand, how do you:
- Produce your goods and services?
- Position various marketing channels to get your message out?
- Utilize your distribution channels to deliver your products and services?
In terms of supply, how do you:
- Get your raw materials to add value for customers?
- Innovate around the supply chain to do things differently?
Connecting supply and demand, ask:
- Have your customer tastes and preferences changed – or may likely change?
- Are there emerging customer segments you can tap into and capture before your competition?
- What is the unique selling proposition for each customer segment?
- How do you differentiate your company through brand?
- Who are your partners in your ecosystem?
- What key skills and resources are needed?
- What is the allowable cost structure needed to achieve your objectives?
Next, take a good look at the people part of your performance equation. In other words, how does the inside of your organization look?
It’s important to know what your employees are thinking because it will determine whether or not they are contributing to your strategy and putting in discretionary effort.
Consider whether or not you are:
- Recruiting the right people for your culture.
- Fueling motivation so people are excited to give their best each day.
- Nurturing the right skills for your organization.
- Connecting employees to the bigger value they provide in society.
The key is to give consideration to both the outside (demand and supply) and the inside (employees and culture). 1) What things are creating new value, amplifying value, or diminishing value for your organization? 2) What is the projected change pattern for getting back to the “old normal?”
Don’t try to predict the future. Instead, think about and anticipate what might happen so you can outline alternate stories that you can evaluate later.
Using short, targeted employee surveys to get answers
Capturing employee feedback and using it to guide your decision making is important, especially now. A comprehensive employee engagement survey is key to ensuring the health of your organization. But short, targeted, and more frequent “pulse” surveys (no more than 10 questions, typically) are an extremely efficient way to collect feedback. Use those results to determine where to focus your efforts, make data-driven decisions, and take action for improvement.
Internally, short and targeted surveys help you to:
- Watch for signals about the employee experience and how well your culture is supporting your strategy.
- Gauge connection and alignment with your strategy and values.
- Know if your people feel motivated to give their best.
- Make sure your employees feel appreciated and recognized for their contributions.
- Determine if your employees have the right tools to do extraordinary work.
- Identify any potential barriers.
There are external benefits to employee feedback as well. As your employees are your eyes on the world, they are often the first to notice changes that may affect your current course. A good pulse survey will alert you to these changes much faster than the same information will show up in financial or sales reports.
Remember, organizational threats and opportunities often begin as weak signals from the periphery. Tying into the real-time use and ease of pulse surveys to monitor these triggers will help you to quickly seize opportunities and mitigate threats.
An effective, step-by-step process for transition teams
Developing a successful strategy should be centralized around scenario planning or thinking. In other words, craft possible alternate stories to help you determine where to place strategic bets. Here’s the process we recommend:
Establish and launch your transition team. Take time to set clear expectations and enable team members to step away from their daily responsibilities to dedicate time to this effort.
Craft priming questions to stimulate thought. Remember, all great change starts with a question. These questions focused around each time frame, should come from the CEO or senior leaders.
Engage in scenario planning or thinking. Define several plausible futures. Give a lot of thought to various possibilities and think outside of the box. Continually assess which of the scenarios you might be facing and determine where a pivot makes sense.
Change the way your strategy is conceived, created, and executed. In today’s complex and highly uncertain environment, defining your strategy requires mining for insights, experimenting, and learning.
Pinpoint the key drivers of assumption. Look at predictable and unpredictable trends. Decide which uncertainties and variables are most influential. Construct a visual framework, such as a 2×2 matrix, to plot two variables at a time and then use those quadrants to begin forming plausible scenarios.
Determine which plausible scenarios to prioritize. Play out the implications for each story. Think about the different types (U-shaped, V-shaped, etc.) of possible recovery. Don’t always go for the most possible. Then, decide where to place your strategic bets and consider what resources are needed.
Create strategic checkpoints. Implement signals that will tell you when to pivot or initiate a specific action. If you have a handful of well-developed plausible scenarios, they will include these triggers.
Five implications for leading in an uncertain environment
Here are the five key mindsets or practices to consider going forward:
- More distributed responsibility. It will no longer be isolated at the top of the organization. With more remote workers and flatter organizational structures, responsibility needs to be redistributed.
- Increased levels of trust. With more workers operating from home, the principles of “management by walking around” becomes more difficult. Trust will be more important than ever – not just for leaders, but employees too.
- Leaders as coaches, not directors. While many had already begun this shift, the new work environment will increase the need for leaders as coaches.
- Importance of connecting peers. With a dispersed workforce, the need for connection increases. Managers and leaders need to encourage more and meaningful peer interactions.
- Connecting more people to the external environment. Leaders should encourage employees to develop an appreciation for the value of their contributions. Build capabilities to increase strategic thinking so senior leaders can focus on the bigger picture.
Right now, challenging the status quo can pay big rewards for organizations. With the right approach, you can emerge from the current landscape with a strategic advantage.