COVID-19 impact: Actions for today and the coming months
Research demonstrates that companies that come out strongest from previous crises had no specific advantage at the onset of these crises. We share actionable thoughts to lead through this one while avoiding “war room fatigue”. Our focus is on Leadership, Strategy across time horizons, and Cash Flow.
Transcript of the presentation:
From managing the response to leading through crisis
You’re not going to outpower this crisis
Goal: to be STRONGER LONGER
In most crisis, the crisis is very brief, and the recovery might take a long time. Here, the crisis itself lasts weeks/months.
Issue is to manage teams to avoid burnout DURING the crisis. This requires some practice & mindset to avoid “war room fatigue”.
How: act collaboratively and consistently
Make sure your employees are onboard the overall mission.
Ensure your people have both: Clear Guidelines + Ability to Act.
This crisis is a whole different magnitude to others, emotionally. Your people need some sense of security before they can be productive & present to their job.
Have a rhythm in how you communicate (employees, clients,...)
Don’t be afraid to show emotions
Have your Senior people make the random call 3-5 levels below, have a brief conversation (be authentic about it)
Have channels where you can hear back: what are your people most concerned about?
Maintain relationships to be able to bring back good people quickly (maintain benefits,... where you have to end/pause contracts)
Navigating the current crisis
Make plans, don’t rush your decisions
Resist temptation to react and give yourself a cooling off period
Break big goals into smaller goals and focus on achieving these
Research & apply to all support programs available for your business (grants, loans,...)
Figure out how your customers’ needs have changed
Keep in mind these will probably be different again in 6 months
New habits are being built – include your customers into your planning process
Build harsh but realistic estimates of your cash flow
Cut the more flexible expenses early
Delay all expenses that can be (even if you don’t “need” to today)
Employees: think long-term and be human
Your best employees are your most valuable asset today and when rebuilding after the crisis
Thinking across horizons
First 30 days: resolve immediate challenges
Up to 3 months: resiliency build-up
Speed & discipline are key
Guiding principle: radically generous with customers and partners & thoughtfully aggressive with near-term revenue and expenses management
3 to 6 months: recovery readiness
6 to 12 months: re-imagine the “next normal”
Demand shifts?
Changes in regulatory and competitive environments?
Appetite for “Big Moves”
M&A, Reallocation of capital, Capex, Productivity, Differentiation
Stimulate your Cash Flow
Radical generosity & thoughtful aggressiveness as guiding principles.
Near Term: calm customer nerves & close sales
Take risks with warranties, guaranties and return policies
Implement new revenue/pricing models
Test them on “superconsumers” (they have a shared interest in your survival)
Accelerate innovation
Launch innovations ahead of schedule, even before fully ready
Cut marketing costs, especially the most “established” ones
Cut any investment where there’s doubts on pay back but too difficult to cut in “normal” times (politically, optically,...)
Engage in new kind of customer acquisition
Strategic sampling, M&A,...
Bring people into the future with confidence & hope
Prepare the different phases to be in a position of leading v. managing.
What “back on” looks like?
What if there’s a blip in the Summer?
What if there’s a full-blown lockdown in the Fall?
Look at the environment 2-3 & 6 months down the road
What has to be true for that to happen?
What can threaten that from happening?
Build a best case & worst case of your company
List what got you to the best case
List what actions you could take in the worst case envisaged
Source: Trachet Consulting Services, HBR.org, mckinsey.com