How To Create Winning Strategies That Reignite Human Potential, Adaptability and Creativity

Yesterday I gave a presentation to a NED Forum event sponsored by Investec. It covers a topic that I think is one of the most important issues for CEOs and Boards today who continue to grapple with the challenges of COVID.

The 3 key objectives for the presentation were to:

  1. Better understand what are some of the key and complex forces at play in organisations due to COVID
  2. How organisations can be more adaptable and resilient to future disruptive change
  3. And how to do this with more humanity using some best practices of a growing new breed of organisations out there

You can view the presentation here or below including the REIGNITE! 2020 Report:

The REIGNITE! 2020 Report

For those interested on more detail, below I have pasted in snippets of the talk including the Introduction.

Enjoy!

——

Hello and welcome everyone. Thank you to The NED Forum and Investec for the opportunity to speak here today. My name is Andrew Essa, and today I’m going to cover a topic that I think is one of the most important, if not THE most important, issues for CEOs and Boards today.

And that is:

Not just about turning this COVID crisis into an opportunity

Not just about where CEOs should focus, or where to invest

And not just about what winning strategies to implement to outmanouevure the competition

But more about HOW to do all of this in a way that is also more humane, more trusting and less bureaucratic, and in a way that can unleash the potential and creativity of people to have more impact and more fulfilling work lives

So we will aim to do 3 things here today:

  1. Better understand what are some of the key and complex forces at play in organisations
  2. How organisations can be more adaptable and resilient to future disruptive change
  3. And how to do this with more humanity using some best practices of a growing new breed of organisations out there

Slide 2 – Gary Hamel quote

  • So to bring this quote which I love and also my ‘fascination’ with this topic – I’ll tell you a quick story about ABC Learning Company, based here in Gsy. 
  • Obviously that is not their real name but I came across them in some research I did during Q2 and lockdown. 
  • In the research which later became the REIGNITE 2020 Report – which I’ll introduce shortly – there was so much devastation across sectors including travel, hospitality, retail, construction, manufacturing, and so on. 
  • In fact 50% of the 439 leaders surveyed were in total despair, in terms of closures, restructuring, uncertainty and so on. 
  • However…there was a glimmer of hope!
  • About 10% of businesses were doing extraordinary things. They were using the crisis as an opportunity to reset, rethink, and reinvent. They were pivoting, quickly using technology to launch new offerings, testing new business models, and at the same time becoming more efficient, productive and reducing costs.
  • In terms of ABC Learning, it was a typical lifestyle business providing high school tutors, owned by one person with 5 tutors on the payroll. No online presence, web-site or anything. Business stopped overnight with lockdown, but by rethinking things quickly and using simple online and digital tools – google spreadsheets for CRM and bookings, zoom for delivery of live sessions, stripe for online or over the phone payments, the owner was not only able to quickly survive but doubled revenue during lockdown, hired 10 more tutors on contracts, and created a scalable solution which allowed for recorded training on-demand on popular topics. So better CX, more revenue and profits.
  • So what is interesting here is the combination of human psychology and business strategy during a crisis: so how did the leader reinvent whilst everyone was retreating, what can we learn, and how can we emulate this for our own contexts
  • This is what underpins today’s talk and certainly the REIGNITE 2020 Report which I’ll introduce shortly.

Slide 5 – The Modern Org is Under Attack

  • So the modern organisation is clearly under attack from so many angles. 
  • The pace of change now is exponential and only will increase as further technological convergence happens through digital, AI, automation, analytics and so on
  • Today’s orgs look and feel very similar to how they have always been – command-control, top-down consistency, coordination and standardisation- which is the classic bureaucracy 
  • In US 1983-2019 the bureaucratic workforce – managers and overhead – has doubled in that time-frame VS growth of 50% in all other job categories
  • At same time productivity per OECD has gone down since them
  • Mental health, burnout, anxiety, stress, bullying, politics, discrimiation, harassment etc has skyrocketed 
  • Do we know anyone who is a leader, manager or worker and genuinely feels inspired, trusted, valued and engaged by their organisation every day??
  • We can’t afford it anymore!
  • So the question becomes, is it possible to build organisations that are big and fast, disciplined and empowering, responsive to market shifts yet resilient, efficient and entrepreneurial, and bold and prudent?
  • Many examples of new breeds of organisations successfully operating with 1/2 of bureaucratic load of traditional org
  • Case study – Buurtzorg (page xi)
    • Dutch firm Birdszaard home-health employers 16,000 nurses and home-carers with 2 line managers with a span of control of 1-8000!
    • They do this with dividing into small teams, give them the data they need to be self-managing, connect with a social platform to collaborate to solve problems and collaborate and share best practices, hold deeply accountable with P&Ls
    • Gives all the advantages of bureaucracy with control, consistency and coordination with no drag or overhead

On Digital Business:

  • Speed and scale: Digital and cloud has enabled adaptability at speed and scale;
    • The crisis has shown that rapid change at speed and scale is possible using digital and cloud in the short-term.
  • Increased adoption: Increased adoption of back-end cloud and front-end productivity tools, from e-signature to VC to MS365 to Dropbox etc
  • Effectiveness and benefits: Focus now on what is working, what isn’t, benefits realisation, productivity, efficiency, training, 
  • Complexity: So much going on…..managing capacity, cybersec, managing the complexity of the new IT estate, ensuring greater resource allocation with 2021 budgets, investments and leadership commitment to that 
  • Scaling and Transformation: The best firms – probably not many – are:
    •  firmly putting digital at the centre of corporate strategy
    • looking whether to build vs buy
    • aligning leaders on digital acumen so every CXO is a Chief Digital Officer for their function
    •  looking at wider opportunities for upskilling and digital adoption across the firm – so beyond infrastructure into more advanced worker productivity tools – automation, AI, analytics, superior Customer Experiences, New Business Models and Products/Services, Ecosystem Collaborations/Ventures
    • As well as more strategically, how to better organise and transform to become a digital business
  • Caution! Digital laggards will get left behind due to external forces and competitive intensity

On Trust + Safety:

  • So this is such a critical, complex and often overlooked dimension, mainly as it requires leaders to be empathetic and emotionally intelligent, and unfortunately many aren’t  
  • The BIG opportunity is that for the firms who get these complex dynamics right, will differentiate themselves from a talent retention and hiring perspective and become the new employers/brands of choice 2021+
  • But first we need to look at the state of play before COVID
  • In a nut-shell, there is very little trust, just need to look at amount of oversight, rules, policies, rule-choked processes and employees get this and know they aren’t trusted and even that their managers don’t think they are very capable
  • UK amount of discretion people have in jobs has been going down in last 20years
  • Only 1 out of 5 believe their opinions matter at work
  • Only 1 in 10 have the freedom to experiment with new solutions and methods
  • Most people can buy a car or house but same people in organisations can’t order a better £150 work chair without going through crazy internal hoops and hurdles
  • The way organisations are organised it is a caste system of managers and employees of thinkers/doers which causes disengagement of people from their work
  • Gallup surveys show only 20% of those highly engaged in their work – this is ALARMING so something needs to change
  • So against that backdrop you introduce a health and economic crisis of proportions never seen before, which impacts the human psyche in many different ways, and for most orgs you have a widening trust gap
  • Key impacts:
    • The “psychological contract” between employer/employee has also shifted for many
    • Traditional work assumptions have been challenged, firms must now not assume ‘old’ practices were the right ones
    • Acceleration of complex issues around safety, mental health, inclusivity, belonging, empathy, EQ, culture and behaviour, power dynamics, and expectations on leadership styles

An Interview With Gary Hamel

I recently listened to the Eat.Sleep.Work. Repeat podcast where Bruce Daisley interviewed Gary Hamel about his new book Humanocarcy. I posted about my excitement to recieve the pre-order of it here, and am really enjoying working my way through it.

If you are a leader, manager or worker in ANY job, this book (or notes below) is a must-read.

Whilst I rarely (well, never) take notes of the podcasts I listen to, after the first 5min it was clear I needed to capture the content. There was just so much unbelievable value Gary Hamel was providing.

And so the below represents my rough notes of that interview (which includes the below quote – so simple, yet so powerful):

Cannot assume that low-skill jobs means low-skill capabilities! – Gary Hamel

Enjoy!

What is the impact of COVID on the world of work?

  • Remote work and flexibility is possible, that will continue
  • Power moves to the periphery. Front-line people have had to use their ingenuity along with more freedom and autonomy so these people will not want to go back to traditional roles
  • Institutional and political resilience has come up short. Organisations are poorly suited to fast-moving, demanding problems and challenges beyond COVID such as racial injustice, income inequality, environmental change, automation impacts will need everyone to turn on everyone’s creativity

What is going on with the state of trust?

  • Yes very little trust, just need to look at amount of oversight, rules, policies, rule-choked processes and employees get this and know they aren’t trusted and even that their managers don’t think they are very capable
  • UK amount of discretion people have in jobs has been going down in last 20years
  • Only 1 out of 5 believe their opinions matter at work
  • Only 1 in 10 have the freedom to experiment with new solutions and methods
  • Most people can offered to buy a car or house but same people in organisations can’t order a better £150 work chair without going through crazy internal hoops and hurdles
  • The way organisations are organised it is a caste system of managers and employees of thinkers/doers which causes disengagement of people from their work
  • Gallup surveys show only 20% of those highly engaged in their work – this is ALARMING so something needs to change

What is the impact of bureaucracy?

  • A 1/3 of wage bill goes to managers, supervisors and administrators
  • A 1/3 of all hours/activities in organisations goes to bureaucratic tasks
  • In US 1983-2019 the bureaucratic class has grown by 200% (doubled) in that time-frame VS growth of 50% in all other job categories
  • It’s not about more regulation but the proliferation of new functions
  • At same time productivity per OECD has gone down since them
  • We can’t afford it anymore!
  • Many examples of post-bureaucratic vanguard of firms operating with 1/2 of bureaucratic load of traditional org
  • Dutch firm Birdszaard home-health employers 16,000 nurses and home-carers with 2 line managers with a span of control of 1-8000!
  • They do this with dividing into small teams, give them the data they need to be self-managing, connect with a social platform to collaborate to solve problems and collaborate and share best practices, hold deeply accountable with P&Ls
  • Gives all the advantages of bureaucracy with control, consistency and coordination with no drag or overhead
  • Can cut the bureaucratic drag by 50% would produce 10T gain in economic output across OECD (in UK £900B) and would double productivity growth rate over next 10 years
  • No other proposals on the table eg improving education, more incentives for capital investment
  • Economic reason, competitive reasons, social reasons as ethically the reason to do this

How do we get there?

  • Foundation for building a post-bureaucratic organisation is everyone thinking and acting like an entrepreneur, owner
  • Pre-Industrial era most owners/employees 4-5 people, all customer-focused and knew each other
  • As organisations scaled in line with Industrial revolution that was lost and no longer have the information to be self-organisation
  • Firms that do it e.g. Haier, Nucor ensure the front-line people have the information, skills, incentives, and freedom to think/act like owners
  • Still have to have coordination and tie the org together, instead of top-down it can be via collaboration
  • Some organisations have ESSP but that’s not what an owner – autonomy, right to make key decisions, right of participation in the financial upside of the business

Have we over-valued consistency and scale?

  • Bureaucracy invented to enable control and efficiency at scale with a top-down model
  • Replicability required to do things properly at scale
  • But that makes it very hard to change 
  • Control is important in most industries! 
  • But what else is important and what other ways to achieve it?
  • Orgs at heart are built to maximise control
  • Today we need orgs to maximise contribution with free to experiment, free to respond quickly to customer needs, free to solve local problems, not waiting for permission 
  • In bureaucratic model everything comes top-down which makes it hard to change fast
  • By the time an issue is big enough to attract CEO’s attention, often too late by then
  • E.g. Intel CXOs only would go after $1B Opportunities – but how do you know what is this at this scale? Only way is if someone else is already doing it i.e. not original, innovative. Nothing starts out as a $1B opportunity VS Amazon which experiments with all sorts of opportunities at different levels VS waiting for someone at the top to say ‘this is a strategic priority’ which will rarely happen

Experimentation is part of the new Org DNA

  • Pace which anything evolves is limited by the amount of experimentation that takes place e.g. humans today
  • Worrying that vast majority of employees say it’s virtually impossible for front-line employee to get a small amount of time and budget to try something new
  • More than ⅔ of employees say new ideas are greeted by hostility or skepticism 
  • E.g. central collaboration platform at a global tech retailer to share ideas and issues and real-time and treat the stores/orgs as a laboratory
  • Bezos says his goal is to build the world’s biggest lab, best place to create break-out success or fail with ideas vs if know it will succeed as have data it will likely be incremental innovation 
  • Intel hires goes through ‘Design To Delight’ programme teaching ‘design thinking, rapid prototyping, agile, experimentation’ 

Is the moment now a great opportunity to experiment?

  • We’ve had the tools/tech to enable remote working for over a decade 
  • Whilst tech becomes more available, also enables orgs to exert more control! Due to analytics. 
  • But data is not context and is historical 
  • We can assign every worker a detailed rulebook on what they need to do and somehow it aggregates into extraordinary performance. But does not reflect reality 
  • Battle of forces pushing decentralisation and autonomy and remotely, enabling lateral communications VS vertical challenging managers top-down
  • Same complexity to drive decentralisation is also pushing to exert control especially with the old guard 
  • One of the ways to ‘soothe’ a leader is to go to bed at night is that there is a policy to guide everything! I.e. squeeze the complexity of the chaos and world by creating appearance of uniformity and control but reality is far from it

The paradox of forces at play:

  • Consistency does matter – when I got to Apple store we expect certain things
  • But we do need this and creativity on the front-line with ability to tweak and change to make the real-time trade-offs
  • E.g. Nucor – unleashed the everyday genius of workers 
  • Tension between adaptability vs consistency 
  • Even if irreconcilable the eco value from scale is not what it used to be VS demand now for customised, personal experiences 
  • It will be a long slog
  • Over 70% say the prime way to get ahead is to be a good bureaucrat! i.e. horde resources, politics, climb ladder, attain positional power
  • But requires political challenge to redistribute power which no-one will like to do that 
  • System is working for anyone – workers, managers, leaders 
  • It all grows to accumulate power! We have to change that game 
  • Power needs to be fluid in orgs
  • If adding value people or a mentor or inspiring people will follow

What;’s happening in politics?

  • There’s a belief that the system is not working for them – income inequality, low wage jobs, equity
  • Workers treated like commodities, resources VS opportunity to use all competencies, skills, grow etc
  • Cannot assume that low-skill jobs means low-skill capabilities!
  • Stop talking about low-skilled jobs!
  • US Bureau of Stats – 70% low-skilled jobs are designed so people cannot use their originality 
  • Economically indefensible that we haven’t done more to given front-line people the opportunity to grow and use ingenuity

Can all orgs make this change away from bureaucracy? 

  • If you are a smaller business, what are the principles to hold scared as you grow the org
  • Founding principle – humanity vs bureaucracy 
  • From the start highly alert to the signs of bureaucracy to stay vibrant 

US Airlines example

  • Needed to kick-off some people to allow crew on
  • Staff did not have authority to offer correct incentives
  • Passenger carried off and became worst PR disasters ever
  • The CEO said workers did not have the procedures, guidelines, rules to use their own judgement! But it was the existence of too many rules that did not allow the local staff to use their own judgement 
  • Manual at UA is 60 pages VS manual at Southwest Air 5 pages

Haier Case Study

  • Hair Chinese domestic appliances
  • They wanted to build a network company
  • They divided 80k organisation into 4k micro-enterprises
  • All businesses had rights and flexibility akin to start-ups with significant incentives
  • Tied together with internal contracts for services e.g. HR or can go outside
  • Everyone’s performance – including internal contracts – is tied together on the success of the product in the market so everyone is aligned
  • Make it easy to start new businesses, if new idea post it online internally and others can join, Haeir can give you access to their VC network and they will co-invest and you can leverage the Haier network
  • Haier to make the journey redeployed 12k middle-managers to the micro-enterprises (or left), today three is 1 level between front-line and CEO, most firms have 8 levels

 

 

 

4 Major Post-COVID Megatrends

This week I came across a great report and visual from market intelligence firm Luxinnovation. It focused in on the major megatrends that will impact the economic recovery: digitalisation, sustainability, resilience and new business strategies (see below):

The study “Post COVID-19 Market Trends” is based on information from three sources:

  • National recovery strategies that have already been published by European countries, as well as the European Commission’s recovery plan and position papers issued by international organisations such as the OECD and the World Economic Forum
  • Technology and innovation market studies taking into account the impact of the COVID-19 crisis
  • Articles published by specialised press on topics related to current market trends in the post COVID-19 period

As the report aligns with recent research I conducted into strategic responses of a range of organisations across the world (REIGNITE! 2020 Report), I’ve summarised the key points below as highlighted by Sara Bouchon, Head of Market Intelligence at Luxinnovation.

On digital:

  • Even though the crisis brought some parts of the economy to a near standstill during the lockdown, it has strongly accelerated some trends, such as digitalisation
  • A large proportion of the workforce had to switch to remote working with almost no advance notice, for example, and many shops had to very rapidly start selling their products online
  • Digitalisation also turned out to be a success factor for some industrial companies with a high level of automation, which allowed them to continue producing even when the staff could not be present on site. This will speed up the development of the factories of the future that are based on Industry 4.0 principles

On resilience:

  • The huge impact of the current health crisis has raised people’s awareness of the potential consequences of a future climate-related crisis.
  • Many governments have recognised the need for a sustainable recovery and the opportunity to “build back better”, to use the words of the OECD
  • Recovery plans will include dimensions such as achieving the transition to renewable energy, shifting to a circular economy and rethinking food value chains to make them more local and environmentally friendly. There is also a will to invest in sustainable infrastructure
  • The ability to absorb and adapt to external shocks is vital, for countries as well as for companies and individuals. This crisis has highlighted vulnerabilities in the way our society functions of which we were not aware. It is essential that we work on lessons learnt and define what we can do to become more resilient.
  • A main focus in obviously on the healthcare system that is some places has been pushed to the very limits of its capacities. Other key issues include the building of regional supply chains, the development of new skills that help the labour force be flexible and agile, and ways to stimulate an inclusive democracy

On business strategies:

  • While businesses are now dealing with the severe short-term impacts of the crisis, many of them will have to reconsider their strategies in the post-crisis period, taking into account the “new normal” situation.
  • Some companies that adapted their production in order to respond to the urgent needs for disinfectants, face masks and visors, for example, are considering whether to stay in those markets or not.
  • Others, who changed their business model to offer online shopping or home deliveries, ask themselves the same questions
  • COVID-19 has been a strong driver of new forms of business innovation
  • New partnerships have been formed that would not have happened otherwise, and we can see much more of open innovation. This, in turn, challenges the current regulations of intellectual property as many innovations stem from cooperations involving several organisations
  • The health crisis has created new consumption and working habits, new needs to ensure that sanitary measures are being respected in offices, shops and other public areas, and new demands for entertainment in a context where large gatherings and face-to-face contacts are difficult. These are some of the areas in which we expect to see a lot of innovation in the near future.”

If you are interested in more context on the future implications of COVID, check out my recent report called REIGNITE! 2020 Report

Digital Playbook: How And Where to Focus to Maximise Opportunities In a COVID World

In summary, this article provides:

  • An 8-point playbook of strategies which leaders can use to focus time and resources to build digital capabilities and navigate business change
  • A useful framework to compare or evaluate existing digital investment and innovation initiatives to improve quality and impact
  • A useful article to share or use for internal discussions with non-digitally native executives, Board members and cross-functional teams
  • A set of practical strategies to guide implementation following on from the key insight and findings in the REIGNITE 2020 Report authored by Andrew Essa
  • A playbook to evaluate your digital progress and help plan for the future. Get in touch with any questions, comments or help to implement these perspectives here andrew@rocketandcommerce.com or at ROCKET + COMMERCE

The 8 strategies include:

  1. Understand current digital usage, productivity, value and benefits
  2. Diagnose and benchmark digital performance and opportunities
  3. Scale digital capacity for increasing demand but manage complexity
  4. Review and upgrade cybersecurity measures
  5. Move from ‘good’ to ‘great’ across 4 key areas
  6. Prioritise resource reallocation to digital initiatives (with a crisis mindset)
  7. Improve the digital acumen of the Board (and workforce)
  8. Organise to build digital capabilities

8 Strategies For Leaders to Navigate Digital Acceleration

Although some organisations are thriving on the back of tailwinds in this environment, many more are struggling. In many cases, the difference between the former and the latter is an organisation’s ability to rapidly adapt and chart a sustainable and differentiated path forward, especially through maximising Digital opportunities across areas including Customer Experience, Growth Strategy, Workforce Productivity, and Organisational Adaptability (I posted recently here about the 3 Big Digital Opportunities for Organisations)

Below are 8 playbook strategies for leaders to now consider:

#1 Understand productivity, value and benefits 

For most organisations, the critical first step has been to safeguard employees by enabling them to work remotely using the full suit of available tools (see below). 

hub---digital-workplace

As this continues alongside partial or even full reintegrations, firms should continuously engage or ‘pulse check’ with workers, customers and key stakeholders. It is critical to evaluate what is working well (e.g. feedback, analytics, usage), what is missing (e.g. cybersecurity, training, IT hardware), lessons learned, and where low-hanging fruit is for further digitisation opportunities and benefits (e.g. customer service and experience).

main-qimg-1e639c31c8722a6fa494676916d1199f

A challenge to overcome is that most firms typically fail to realise the full value from their technology investments for a variety of reasons (e.g. budgets, skills, governance, change, training etc). What tends to happen is some efficiency and cost reduction, but limited revenue generation, improved customer experiences and new products/services. The firms who out-perform their peers are the ones who prioritise and maximise the full potential of digital and are laser-focused on benefits realisation across the organisation. 

“The crisis has sped up the utilisation of tools such as Microsoft Teams for meetings, e-signature software and other tech which will assist both with internal and external customers moving forward. Typically face to face meetings or travel has been a big part of how we’ve conducted business particularly in my role in the past – Client Director, Private Investment Bank (interviewed in the REIGNITE! 2020 Report)

#2 Diagnose digital performance and opportunities 

For some SMEs, the current state of digital maturity involves a combination of accelerated back-end cloud, front-end software tools (e.g. MS 365), and new ways of working. Other larger, established firms however continue to have core (or hybrid) infrastructure set-ups based on outdated tools, processes, and assumptions combined poor digital acumen at leadership level and limited workforce training or up skilling.

This makes it increasingly difficult to adapt to new challenges (e.g. remote work, new services, cybersecurity), manage complexity, and properly reap the benefits of digital technologies. In some cases, the lack of agility will drag down the business which might be fighting to to rescue declining margins, compete, or even survive.

The challenge for leaders is to build on the momentum of change (‘it can be done!’) and increased adoption by leveraging the potential of digital across the entire organisation (not merely in pockets) for improved efficiency, productivity, customer experiences and new products/services.

To get started, leaders need to know what they are dealing with today.  If strategic planning around digital opportunities are to be robust and there is leadership intent to focus time and resources on the digital agenda, data and insight about the current digital state of the organisation will be needed.

Diagnostic surveys tools and assessments can help to evaluate an organisation’s digital and analytics maturity to discover digital growth, operational  improvement and worker productivity opportunities now, with recommendations on where to focus efforts for longer-term growth, change or productivity. 

At ROCKET + COMMERCE our Digital Performance Index (DPI) focuses on areas including Strategy, Customers, Analytics, Technology, Operations, Marketing, Offerings, People, Culture, and Automation. This data-driven, diagnostic approach helps CxOs and functional leadership teams to shape, refresh and align around a common vision and strategy across key digital and innovation dimensions.

We also critically incorporate human-centric approaches (see below) to our diagnostic tools which also provides people-focused data of digital change on users, customers, experiences, productivity, collaboration, skills, behaviours, trust, safety, belonging, health and well-being. 

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Read these brief case studies on how  at ROCKET + COMMERCE we have helped organisations do this and find new ways to go-to-market, become more customer-centric, launch new ventures, or pilot new up skilling programmes

This exercise also allows leaders to identify gaps between current capabilities and those of digital leaders (or the desired future state of the organisation), and plan a prioritised road map of tactical improvements or new strategic initiatives. This data-driven, diagnostic approach can also help CxOs and functional leadership teams align around a common vision and strategy across key digital dimensions. 

DMM_Model_Overview_2020

#3 Scale digital capacity for increasing demand but manage complexity 

Many IT teams are now grappling with providing sufficient capacity to serve the increased (and varying) volumes of traffic flowing through digital channels. One respondent to the survey (a provider of web-based collaboration tools), experienced a surge in demand from all of the newly remote workers and had to rapidly build out new infrastructure capacity to ensure availability.

This transition to digital channels will likely continue beyond the current health crisis as customers and organisations adopt fundamentally different ways of working. Recent research from Gartner indicates that about 41% of employees are likely to work remotely for some of the time post-pandemic. 

RemoteWorkStatisticsSource: Blackfog

The accelerated capacity build-out in H1 2020 has taken many forms beyond physical infrastructure deployment. In many cases, it has pushed organisations to adopt different architectural solutions for expansion, such as cloud bursting and augmenting on-premises deployments with virtual appliances and software-based deployments in the public cloud.

According to Mike Pelliccia, head of worldwide financial services technology solutions at Amazon Web Services (AWS), on-premises infrastructure no longer meets the business needs of today:

On-premises data infrastructures do not scale to meet variable and increasing volumes of data. Multiple disconnected data silos with inconsistent formats obscure data lineage and prevent a consolidated view of activity. Rigid data schemas prevent access to source data and limit the use of advanced analytics and machine learning. The high costs of legacy data warehouses also limit access to historical data.

The cloud helps organisations to harness the value of their data and aggregate it at speed and scale so that they can achieve their business goals. Traditional data solutions cannot keep up with the volumes and variety of data that is being collected today by financial players.

Pelliccia adds that a cloud-based data lake allows organisations – from banks to SMEs – to store all data in one central repository where it can be more readily available for the application of other technologies such as machine learning, “to support security and compliance priorities, realise cost efficiencies, perform forecasts, execute risk assessments, improve understanding of customer behaviour, and drive innovation.”

This enables organisations to maintain a holistic view of their business, while identifying risks and opportunities. For instance, analyses can help to detect fraud, surface market trends and mine for deeper customer insights to deliver tailored products and personalised experiences.

#4 Review and upgrade cybersecurity measures

Whilst many organisations will have robust cybersecurity processes and culture, for many others this will represent a new capability and massive learning curve. What was good just a few months or weeks ago may not be adequate today.

The urgency and impact of the shift away from office working will mean most organisations may have introduced new levels and types of cybersecurity risk not previously seen before at this scale (see below for leading causes of cyber risks).

bakerhostetler-causes-graph

Source: PropertyCasualty360

While allowing the workforce to be flexible is only a small part of digital transformation, it carries with it the need to ensure that new hardware (laptops, home printers, smartphones) and services have been, and continue to be, implemented securely (e.g. full disk encryption, enabling strong multi-factor authentication, and using VPN      technology).  

 #5 Move from ‘good’ to ‘great’ across 4 key areas 

Once solutions to immediate workforce and business priorities are in-flight, organisations should accelerate the exploring of different ways to use digital to work and operate, deliver innovative customer experiences, and create value in the new normal. For example, restaurants enabling entirely new in-home dining experiences, telemedicine becoming more of a norm, and different ways to shop with ubiquitous curb-side pick-up.

According to McKinsey, whilst many B2B companies have a general sense of what they need to do to become more digitally-enabled, it is the best B2B leaders who move beyond “accepted wisdom” to focus on being ‘great’ at 3 main differentiators of digital success:

  • Customer Insights
  • Process Improvement
  • Capability Building

To this list, I add a critical 4th dimension: Business Models 

The below provides further explanation:

Customer insights

  • Good: Focus on understanding their customer preferences and demographics.
  • Great: Ability to quickly translate into the most relevant value-creation strategies. Pick one or two high-value customer segments, then map decision journeys front-to-back to understand how customers buy, what channels they use, what turns them on—and off. More than 90 percent of B2B buyers use a mobile device at least once during the decision process, yet fewer than 10 percent of the B2B companies in the survey indicated that they have a compelling mobile strategy.

Process improvement

  • Good: Relentlessly improve existing processes.
  • Great: Use agile development techniques, automation, and design thinking to reengineer or reinvent supporting processes. Effective pre-sales activities—the steps that lead to qualifying, bidding on, winning, and renewing a deal—can help B2B companies achieve consistent win rates of 40 to 50 percent in new business and 80 to 90 percent in renewals. Incorporating agile techniques forces product development, marketing, sales, and IT to come together and use digital design practices, such as launching minimally viable products (MVP). That can ramp up the cultural changes needed as well.

Capability building

  • Good: Build important capabilities for digital initiatives
  • Great: Identify and augment the capabilities critical to achieving scale. B2B leaders create an organisational structure that supports their digital transformation. That involves identifying which skills need to be reallocated, what data and analytics resources are needed, and which customer opportunities require capabilities that need to be built, hired, or acquired. Systematic performance tracking needs to be in place to keep the efforts on track and make sure they having the desired impact (only one in five B2B companies systematically tracks digital performance indicators).

Business Models

  • Good: Optimise existing business model by digitising their traditional products, interfaces and distribution channels. 
  • Great: Take advantage of platform models and thinking leveraging network effects, intelligent AI-powered solutions, developer/API enablement and ecosystems, and customer-centric orchestration. As every sector digitises – accelerated by the COVID crisis – the imperative to incorporate new digital business models becomes more urgent. This underpins the ‘great’ executors. 

According to digital platforms expert Simon Torrence:

Platform thinking is about taking advantage of flexible software and digital  infrastructure to leverage, at scale, other economic actors (complementary third parties and/or developers) to create new value for customers and markets.Rather than trying to design and build everything yourself – which is the default for most companies today – platform thinking encourages you to act as a coordinator or enabling intermediary between the needs of your customers, your own expertise and the expertise of others.

Simon goes on to say that:

Incumbent leaders admire and fear the big tech giants, and would love to emulate or incorporate some of their ‘secret sauce’ into their own businesses, but don’t know how. They have been happy to invest large sums to digitise their existing business model and fund experiments, pilots and CVC investments in new areas, but have found it difficult to fully embrace the types of digital business models that work best in a hyper-connected world and to take bold steps in re-allocating meaningful levels of capital and resources towards them.

In summary, a commitment to “great” is really what allows companies to reap the rewards from digital and build digital and supporting capabilities. Without it, organisations will find their improvements provide only modest benefits that cannot be scaled.

#6 Prioritise resource reallocation to digital initiatives (with a crisis mindset)

As outlined above, the COVID crisis will accelerate the gap between digital laggards and transforming leaders requiring firms to now evaluate investments, baseline ‘digital maturity’, and in the short-term, secure a stronger, repositioned role for digital investments in 2021. 

In fact, in 2019 McKinsey believed a ‘crisis mindset’ was required. And that was before COVID….

1-920x1024

This is likely to require an urgent reallocation of resources. Although most senior executives understand the importance of strategically shifting resources (according to McKinsey research, 83 percent identify it as the top management lever for spurring growth— more important than operational excellence or M&A), only a third of companies surveyed reallocate a measly 1 percent of their capital from year to year; the average is 8 percent. 

This is a huge missed opportunity because the value-creation gap between dynamic and drowsy reallocators can be staggering. A company that actively reallocates delivers, on average, a 10 percent return to shareholders, versus 6 percent for a sluggish reallocator. Within 20 years, the dynamic reallocator will be worth twice as much as its less agile counterpart—a divide likely to increase as accelerating COVID impacts, digital disruptions, and growing geopolitical uncertainty boost the importance of nimble reallocation. 

The disconnect tends to be because managers struggle to figure out (and agree) where they should reallocate, how much they should reallocate, and how to execute successful reallocation. Additionally, disappointment with earlier reallocation efforts can push the issue off top management’s agenda.

Although these challenges can be overcome, feedback and data from employees, customers, and the maturity benchmarking should help to align senior management commitment to prioritising the short-term digital investment requirements, and at the same time laying the foundation for more detailed discussions and analysis for longer-term strategic planning. 

#7 Improve the digital acumen of the Board (and workforce)

 A UK government report published in 2016 found that the digital skills gap is costing the UK economy £63 billion a year in lost GDP. Similarly, a report from Amrop, a global executive search firm, reveals that just 5% of board members in non-tech organisations have digital competencies, and that the figure has barely moved in the last two years.

In the new COVID world requiring adaptability and digital adoption at a scale never seen before, boards must get to work in reassessing competencies, adopting new ways of working (e.g. continuous strategic planning, collaborating internally and with the wider ecosystem), and being open to hiring diverse backgrounds if needed. 

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In addition, since many new digital directors may have atypical perspectives (e.g. deep technical vs product vs strategy vs HR), companies must make sure that they have strong on-boarding processes in place, to capture and maximise the impact of their new board members.

A critical first step is to ensure a consistent understanding of what digital and innovation means amongst leaders and boards, what are the best practices of leading tech and non-tech organisations, and what are the big opportunities for digital (and threats) in a COVID world. As part of this, improving the board’s understanding of the external environment and how it is shifting, and how the big trends and signals might impact the immediate and longer-term future. 

In many cases, firms will need outside help across recruitment (e.g. diversity), training and education (e.g. research and insight, best practices, benchmarking), advisory, and briefings from experts, entrepreneurs, academics, and other ecosystem players. 

Once the above happens (which in theory can happen quickly with committed leadership), this should provide the intent and focus to refresh strategic plans and budgets, and then roll-out or accelerate digital and innovation upskilling throughout the wider workforce as a strategic priority.  

#8 Organise to build digital capabilities  

Put simply, digital capability can be defined as doing everything it takes to develop an organisation and workforce able to:

  • Maximise the potential of technology, data and talent to address business challenges; and
  • Ability to respond quickly to continual shifts in consumer behaviour and external environment in a fast-changing connected world.

According to recent study by Deloitte involving interviews with industry leaders, achieving this is not easy as the survey had a multi-faceted response. However, organisations that have successfully adapted to this new environment typically make delighting the customer their #1 priority, set bold goals to achieve factors of 10x impact, and challenge the status quo by looking for new ideas to solve.

3 core critical success factors to building digital capabilities:

Leadership:

In these times of significant change, leaders must understand, collaborate, and champion the exciting potential of technology from the very top of the organisation.

However, understanding the full suite of digital opportunities (e.g. API-based BaaS platforms) are often new and alien to leaders of incumbent firms. Teams and advisers need to help them to understand how digital can work, and the options in terms of where to play and how to win. This is critical to getting commitment to re-allocating sufficient capital and resources from other initiatives to support this market opportunity in a meaningful way.

Organisational Structure and Operating Models:

Organisations need to embed and build the right structures and models that allows them to drive digital change and execute in an agile way.  This requires clarity on the firm’s approach to digital strategy (e.g. build vs buy vs partner) as the implementation approaches to build digital capabilities will differ.

For example, many established firms will embark on dual-transformation or innovation portfolio approaches by

(i) executing process improvement and cultural change in the main firm (see ‘A’ below)

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(ii) creating separate legal entities, JVs and alliances to tackle new markets, exploit new business models, sometimes at the risk of cannibalising the main business (see ‘B’ above or ‘Exploit’ below)

82247d19-8db0-4050-8831-d4ec50b39f43.__CR0,0,300,300_PT0_SX300_V1___ (1)

03-Chart-ExploreExploitContinuum

Source: Strategyzer

PingAn has pursued the above approaches to become one of the best-performing transformer of the past decade (and become a much sough-after MBA case study subject). It typically kick-starts new ventures with partners as part of the ‘explore’ portfolio which is one of the most effective approaches to reducing risk and increasing chances of success.

Typically these are best managed away from the core in an ‘explore’ portfolio of businesses within a new organisational structure and P&L. 

Talent, Skills, Culture and Data:

Maximising digital opportunities require radically different skills, technologies, ways of working, and metrics. Organisations need to empower people to be creative, test and learn and challenge existing ways of working. They also need to cultivate diversity and a lifelong learning mindset, recognising that many will resist change. This was highlighted in PwC’s recent Skills Report.

In addition, whilst the focus of the ‘future workforce’ tends to focus on the technical and ‘hard’ skills (e.g. engineering, analytics, coding etc) it is the soft skills and humanities expertise which will gain increasing importance.

Screen Shot 2020-08-21 at 10.56.33

According to billionaire tech entrepreneur Mark Cuban:

“Twenty years from now, if you are a coder, you might be out of a job,” Cuban predicted. “Because it’s just math and so, whatever we’re defining the A.I. to do, someone’s got to know the topic. If you’re doing an A.I. to emulate Shakespeare, somebody better know Shakespeare.” Cuban acknowledged the importance of coding as a short-term opportunity. Long-term, however, the Shark Tank investor pointed out that A.I. is only as good as the data it’s given–meaning the highest-skilled workers in the future will be the ones who can identify “what is right and what is wrong and where biases are.”

Already today design thinking and human-centred design is a new differentiator in digital which complement technical mobile, cloud, AI, and other more technical digital skills.

“Creativity, collaboration, communication skills: Those things are super important and are going to be the difference between make or break” – Mark Cuban

In terms of data (the new ‘oil’) organisations need to capture, track, protect, analyse and maximise the business value of their data, as along with people, this is the most valuable asset.

Some further tactics might include:

  • Senior executive and board training, commitment and refreshed digital strategies 
  • Centralising digital business expertise (e.g. Centre of Excellence) using hub-and-spoke engagement model 
  • Hiring a Chief Digital Officer and team/function
  • New talent and up skilling (e.g. analytics, user experience)
  • Hiring external, flexible talent e.g. freelancers
  • Cross-functional governance
  • New incentives and behaviours
  • Collaborating with wider industry and ecosystem partners
  • Training will be integral which will also enable every C-level executive to be their own ‘Chief Digital and Innovation Officer’ for their functions.

Accenture summarise this using an 8 step ‘playbook’ below:

Accenture-Change-Leader-Digital-Economy-ThumbnailWhat’s next?

To better understand these issues further or explore our range of digital business advisory offerings, get in touch here andrew@rocketandcommerce.com or at ROCKET + COMMERCE

Humanocracy: Creating Organisations As Amazing As The People Inside Them

It is rare that you come across a business book that makes you scream “YEEEESSSS!” when you haven’t even read it yet. In fact, I don’t think that has ever happened to me before.

Just a few words in the blurb from author Gary Hamel did it for me:

“Our organisations are failing us. They’re sluggish, change-phobic, and emotionally arid. Human beings, by contrast, are adaptable, creative, and full of passion. This gap between individual and organisational capability is the unfortunate by-product of bureaucracy–the top-down, rule-choked management structure that undergirds virtually every organisation on the planet” – Gary Hamel, management guru and author of Humanocracy

humanocracy-cover-2x

This quote, COVID-19 and first-hand experience of these issues over the past 20 years provided the inspiration for me to want to better understand what is going on inside large and small organisations around the world across 15 dimensions including leadership, strategy, culture, processes, and technology.

This led to a multi-month project producing the REIGNITE! 2020 Report, numerous new tools and frameworks including the COVID Response Index (CRI) and REIGNITE! FLYWHEEL, a forthcoming ebook (wait list here), and new set of offerings at REIGNITE! Global. 

I doubt Gary Hamel realises what he has started and the impact he is going to have with this book. Actually, he probably does.

Humaocracy is out soon and on pre-order now. Obviously, I have signed up. Book review to follow in September I think.

#covidresponse #covidimpact #leadership #strategicresponse #organisationalbehaviour #organisationalchange

First And Second Order COVID Impacts

Every day there is a new story or report on how COVID will impact X, whether business, industry sector, country, health, your brain, and so on. This has been going for months, and obviously will continue for a long time.

In fact yesterday I posted about this in relation to the island I live (Guernsey).

I’ve since started a very basic list of these impacts. I’ve divided up into first order (direct) and second order impacts (indirect). I haven’t done so but I will need to categorise them.

Over time I’ll aim to build up in a database and post updates here. In the meantime, please feel to comment or add your perspectives here or on the socials.

First Order Impacts

  • Reduction of in-bound and outbound business and leisure travel
  • Increasing shift to online business development and sales
  • Increased e-commerce and local delivery needs
  • Increased demand for flexible and remote working
  • Increased home office improvement needs
  • Shifting social and psychological contract for workers and consumers
  • Increasing focus on mental health, wellbeing, worker and customer safety, trust
  • Office rationalisation due to safety measures and demand for flexible working
  • Smarter, frictionless offices with more automation, smartphone ID, facial recognition and refit for more experiential work e.g. client meets, collaboration, workshops, creativity, training
  • Increased demand for more use cases beyond shopping for contactless payments and frictionless ordering e.g. restaurants, cafes
  • Commercial real estate, higher education and executive training, and hospitality models upended

 Second Order Impacts

  • Trust, safety, culture differentiator for certain workplaces in areas
  • Potential migration away from over-populated major cities (e.g. UK) into second cities, regional or coastal areas
  • Universities unlikely to open meaning a significant number of ‘gap’ years for 18 year olds
  • Existing older leaders aim to cement positions and hold on to ‘power’ or a changing of the guard for new perspectives
  • Changing mix of workforce with more comfort for a ‘talent anywhere’ model
  • Requirement for more flexible resourcing with demand for more specialised contract and freelancers
  • New sectors developing hybrid on/offline business models for smarter, more relevant customer experiences e.g. education, gyms, training, retail
  • More public and private infrastructure development
  • Talent anywhere to hire the best wherever they are
  • Smarter, frictionless, reconfigured offices which may be provided as a perk
  • Smart phone use cases in-store increase e.g. digital ID, office access, ordering in-store
  • Privacy issues around any contact tracing services
  • Retail high-streets and commercial workplaces continue to transform with more residential housing

Google Home Working Until July 2021

After I saw the Google announcement in the NY Post I posted this comment on LinkedIn and Twitter earlier today:

“Big tech tend to be the test bed for new HR practices although many do not go mainstream. Even with the pandemic I still don’t think this will hit mass market either mainly due to powerful old school bureaucratic orgs, entrenched work practices, and many baby boomer leaders holding on for control”.

As a glass-half-full-guy I hope I am wrong here, but having worked in and consulted to many large and small organisations on almost all continents, I can’t see a majority of businesses following suit.

It will be fascinating to track what happens on this issue (and all other organisational behavioural) issues over time.

 

 

The REIGNITE! 2020 Report

“Many have compared the COVID crisis to armed conflict … Once this war against an invisible enemy is over, our ambitions should be bolder – nothing less than to make a fit planet for our grandchildren to live on”Mark Carney, Former Governor, Bank of England

After a few months of research, analysis and writing during lockdown, I am pleased to be able to finally share insights from one of the largest single studies of strategic responses of Guernsey firms to the COVID-19 pandemic (“crisis”) conducted to date.

You can access the full report here, or below I have pasted in the key sections.

Background

Between April and June, I surveyed 439 senior leaders across Guernsey, UK, EU, US, APAC using a 15 question open-ended online survey (see below):

Strategic-Response-Roadmap-(SRRM)

Why?

Given the nature and scale of the pandemic, this really is a once-in-a-lifetime opportunity for organisational behaviouralists to understand what is going on in terms of how firms, leaders, employees and other stakeholders are responding over time.

Specifically, for leaders and firm the findings hopefully help with the following:

New Insight: Leaders and teams can better understand the strategic responses of large and small firms across many different sectors to the crisis, and the complex consequences, behaviour, and implications it has had on firms, people and customers

Priorities: Leaders and teams can learn about the priority focus areas and big opportunities for leaders to better structure and get to work to rebuild and reignite performance

Behaviours: Leaders and teams can learn the new leadership styles, cultural behaviours, mindsets, and ways of working needed to turn crisis into opportunity

Key Findings:

We identified 6 areas of insight for leaders and firms:

  1. Evolution AND Revolution

  • 5-10 years of change in 5 weeks for many sectors
  • Rapid acceleration of many pre-existing structural trends (e.g. cloud, flexible work, e-commerce, up-skilling) and new behaviours likely to endure
  • For many change will likely be evolutionary but for others it will be revolutionary with increasing pace of change e.g. retail.
  • Leaders must continuously identify, evaluate and scenario plan for the right market signals, trends and new consumer behaviours
  • Firms who don’t do this, get it wrong or go too slow risk disruption, market share loss or other business risks

OPPORTUNITY: The top 5 key trends impacting your firm today will provide the investment roadmap for your next 24 months

2. Trust As A Differentiator 

  • There are complex dynamics at play and business and moral imperatives for leaders to assess the impact of the crisis on the human psyche which has affected people in many different ways
  • The “psychological contract” between employer/employee has also shifted for many, and firms must now not assume ‘old’ practices were the right ones.
  • Traditional work assumptions have been challenged, as as well complex issues around safety, mental health, inclusivity, belonging, empathy, EQ, culture, power dynamics, and expectations on leadership styles 

OPPORTUNITY: The firms who get these complex dynamics right will become the new employers/brands of choice 2021+

3. Digital Acceleration 

  • The crisis has shown that rapid change at speed and scale is possible using digital and cloud in the short-term.
  • Rapidly advancing and converging technologies combined with increasing human capabilities, new business models and ways to organise and lead are needed.
  • Digital laggards and firms with limited customer-centricity will get left behind due to external forces and competitive intensity

OPPORTUNITY: Put digital at the centre of your corporate strategy, align leaders on digital acumen so every CXO is a Chief Digital Officer for their function, upskill workers, and prioritise the top3 digitising opportunities beyond back-office operations into more advanced worker productivity tools (e.g. automation, AI, analytics), superior customer experiences, new products/services and ecosystem collaborations/ventures

4. New Skills, Mindsets and Ways of Working

  • As a shift to ‘smarter working’ means different thing to different firms, it is important to define what it is, what it means for the firms and employees, and what are the expected behaviours, required, skills, mindsets, and ways of working.
  • Continued experimentation is required to engage with workforce, test models, gain feedback, learn best practices, and repeat, but the risk is many firms will likely revert to old habits and practices which will jeopardise trust with their talent
  • This process is critical as learnings will likely have firm-wide impacts to entire workforce and processes, practices, culture and strategies e.g. training, performance management, corporate values, recruitment, rewards, policies, agile methods

OPPORTUNITY: Whilst firms who prioritise and commit to this will adjust more quickly to the landscape, those who use intentional cultural design as the agent of change will build a stronger platform than peers for longer-term success

5. Resilience And Adaptability 

  • Whilst many firms are making cuts to ride out the storm or shutting down permanently, our research identified many entrepreneurial firms who adapted quickly with new business models AND in parallel also focused on financial restructuring (e.g. loans, capital raising) and enhancing productivity (e.g. software, up-skilling), better utilisation (e.g. re-deploying staff), or improving customer experiences (e.g. online ordering via Facebook Commerce).

OPPORTUNITY: The firms who get the right but very difficult balance of resilient best practices, innovation for growth with longer-term exploration, and agile/new ways of working will be well-positioned to outperform peers and last for the longer-term

6. Increasing Leadership Complexity 

  • Given the nature of the crisis, for many leaders it represented a call to action to adopt both crisis management AND people-focused behaviours such as empathy, self-awareness, openness, vulnerability, and EQ
  • The best leaders will also now spend more time on longer-term growth and innovation planning and exploration

OPPORTUNITY: Self-awareness is critical for leaders to start addressing skills gaps. Those who do and forge more trusting, purposeful, inclusive, authentic, and empathetic workplaces will retain (and be able to hire) the best talent and rebound faster then competitors

Survey Results

The survey results showed that the crisis has impacted organisations in many different ways over time. Some have had headwinds and tailwinds, but many have been caught in the middle.

The challenge now will be for leaders to be ‘open’ to understanding ‘what is going on’ inside and outside the firm, evaluating the degree to which each is relevant and to what extent, and then planning and executing an appropriate response.

Confidence

Whereas 92% of international respondents were confident of being able to get through the crisis, only 64% of Guernsey respondents felt confident

Speed                                 

96% of respondents indicated that their firms were able to respond to the crisis fast (52%) or extremely fast (44%);

Impact          

22% of firms were unable to operate due to the crisis

Change

Smarter working (34%), new technologies (33%) and new offerings (22%) were pre- planned changes that were accelerated due to the crisis

Work     

47% of respondents saw no changes to their work (i.e. work remotely) with the remaining undergoing disruption including job losses (15%). Adapting to virtual meetings (26%) and new ways of working (27%) were the major changes to jobs/skills

People

Employee safety and well-being (31%) were the major areas of people focus

Leadership                       

Empathetic leadership (25%) with strong communications (23%) were the major leadership behaviours demonstrated

Technology  

Desktop and mobile video-conferencing (VC) tools (46%) and cloud-based document and collaboration software (28%) were the most valuable technologies

Culture

Supportiveness (30%) and team spirit (20%) were the most valuable cultural attributes

Processes

New ways of working (18%) and new technologies (18%) have been the most important processes to improve

Innovation + Growth

 Interestingly, only a small number of firms  innovated with new channels or offerings (7%), with 12% engaging more with clients/partners (12%), and 14% indicating ‘no innovation’

What survey respondents said about the impact of the crisis on:

 IMPACT:

“Categorisation of business critical role and function for immediate, should and medium term. Anything out of above scope, amended, reduced or halted. Focus is on surviving the immediate challenge and preparation for reopening” – Hotel Owner

 SMARTER WORKING:

“The crisis has enabled more working from home flexibility, more focus on work life balance in times like this where stress and anxiety are a big part of many employees’ lives”Director, Training Firm

CHANGES:

“More areas of focus needed include managing mental health and wellness during and after the crisis; planning for the ‘new normal’, whatever that may be, and likely to be different in many ways to how we worked before COVID; and reintegration – thinking carefully about how we transition back to face to face after a sustained period of disruption, easily underestimated and ignored as a potential challenge”Management consultant

LEADERSHIP:

“Empathy, transparency, and authenticity. For example, our MD did a WebEx from his daughter’s bedroom for all to see”Sales Director

CULTURE:

“Agility, flexibility, ability to make quick decisions” – CTO

TECHNOLOGY:

“The crisis has sped up the utilisation of tools such as Microsoft Teams for meetings, e-signature software and other tech which will assist both with internal and external customers moving forward” – Investment Banker

GROWTH + INNOVATION:

We have built industry specific thought leadership and points of view that have historically fallen down the list behind client work; digitising our many face to face interventions, essentially helping us build out a whole new suite of assets that are now deployable in a virtual environment now and beyond COVID; more time for training and personal development – Learning and Development Manager 

Conclusion

In summary, the crisis presents a significant opportunity for all leaders and firms to reset and lean-in to fully understanding what is going on in terms of how the crisis is impacting organisations in the short-term, what this might tell us about longer-term impacts, and where and how to focus efforts and investments across the operating model.

The Post-Crisis World of Work With Adam Grant

As people and businesses plan for pandemic recover and rebuilding, experts such as organisational psychologist Professor Adam Grant of Wharton are a great source of inspiration.

He gave a recent interview with Ross Chainey at European Business Magazine which provided a tonne of insight into the future of work in light of the ongoing crisis.

It was so good that I had to provide an edited transcript of the conversation below. Enjoy

First and foremost, this is a global health and economic crisis. But, for many millions of us, we’re battling a loss of normalcy in our daily lives. How well-prepared do you think we are to deal with a situation like this? Does it play to any of our natural strengths or is it more likely to expose our weaknesses?

It’s a little bit of both, like everything else. The challenging part is, as human beings, we don’t like uncertainty and unpredictability. There’s even some evidence that if you’re highly neurotic, you actually prefer experiencing pain over being in the dark about what you’re going to experience. That’s a part of the crisis that’s really a challenge.

On the flip side, we’re highly adaptable. Darwin wrote when he was building his theory of evolution that natural selection favours a sense of flexibility. It’s not always the strongest species that survives; it’s sometimes the most adaptable.

I think one of the ways we can cope with the uncertainty is: when you can’t imagine the future, you can actually rewind and think more about the past. You can recognize hardships that you’ve faced before. You can learn something from the lessons of your own resilience and then try to figure out “what did I do effectively before that might work for me today?”

I still hear a lot of people complaining about FOMO – the fear of missing out – even though there’s nothing really going on. Has COVID killed FOMO or exacerbated it?

I prefer to think about this less in terms of FOMO and more in terms of what’s often called JOMO, which is the joy of missing out. I actually made a list of all the things I’m thrilled that I don’t have to do, and that includes changing out of sweatpants [and] having to commute.

This is a practice that’s pretty useful for people. We have a lot of evidence that marking moments of joy can actually create those moments of joy because we’re more likely to notice them. We’re more likely to savour and share them. Being able to capture a few things that are really joyful about getting to stay home seems like a productive step.

We’re all separated from our teams. How can we maintain a sense of belonging while isolated at home?

I don’t know that it’s easy. In one company, they did a virtual tour of their home offices. That gave them the chance to talk about some of the mementos that they keep nearby. They were showing off pictures that their kids drew for them. And it was a great moment of personal connection in a way that never would have happened if everyone was in the office.

I’m not suggesting that’s the perfect fit for everyone, but it seemed like a small step that can make a meaningful difference in feeling like I learned something new about my colleagues, [that] I see them more as human beings as opposed to just achievement robots.

Every team has its introverts and extroverts. Do you think this crisis has levelled the playing field between them?

I wouldn’t go that far. I think the reality of the current situation is we’re still catering to extroversion. We’re now sitting on video calls all day, as opposed to saying: “You know what, maybe we should have fewer meetings”.

We’ve known for a while that that introverts’ voices tend to get overlooked in a group setting. This would be a good time to experiment with moving towards some more independent individual work, which we know is the best approach if you want to generate lots of good ideas in groups.

One of the simple practices I would recommend to make sure that introverts don’t get drowned out is to shift from brainstorming to brain-writing. So brain-writing is a process where you [ask] all the people in a team to come up with ideas independently, then submit them. Then you review them. That leverages individual strengths around coming up with original ideas and allows the group to do what it does best, which is to begin to evaluate and refine. That’s probably one of the most effective ways to make sure that introverts are heard.

Through this crisis, managing expectations has become even harder. All of a sudden, we’re workers, we’re teachers, we’re providers, we’re cleaners. Should we try and keep up? Is this good for our sanity?

This is a time when leaders need to be flexible and compassionate. This is not an experiment that any of us opted into, but as long as we’re stuck with it, as a leader, it’s an opportunity to say: “If I impose less control over people’s schedules and plans, that’s going to teach me whether I can trust them or not”.

We’ve known from a couple of decades of research on management and monitoring that when people are monitored too closely, that signals distrust and they respond by saying, “I don’t really feel obligated to act in a way that you might consider trustworthy”. Whereas when you allow [people] to make some choices, they start to feel a greater sense of loyalty and they reciprocate the trust that they’re shown. Given that we don’t have a lot of options anyway to control people, this is the ideal time to do a little bit less of it.

Is this a particularly challenging time for managers, and what advice would you have for them?

I think this is a great time for leaders to be more hands-off when it comes to scheduling and planning. Where leaders may need to be a little bit more hands-on is in figuring out how their people are doing on a day-to-day basis. This is one place where leaders have an opportunity to learn.

Imagine if you’re a manager, how awkward it would be in year two to sit down and say: “I’d love to find out what you’re finding interesting in this job; what aspects of your work you find meaningful; and are there changes we can make that would make your job a little bit more exciting?”

This is a moment when leaders can take a step back and say: “I haven’t always learned as much about my employees’ values, interests, strengths, motivations as I should have, and what better time than now”.

How does work/life balance work in a crisis like this?

Work/life balance has been a myth for a long time. If you care about your family, and you care about your job, and you also want to prioritize health and friendships and hobbies, the idea that you might have even a day where all those things are in perfect harmony to me is hysterically funny, if not just wrong.

What I always strive for is balance in a week, where I might have two days where I’m pretty focused on my work and I don’t get as much time with my family as I want, but then I’ll have two more days where I’m in family mode and work takes a backseat. That’s probably the most realistic way to manage this crisis – to say [that] instead of work/life balance, we ought to think about work/life rhythm.

You’ve written a lot about givers, takers and matchers. Does this period of self-isolation when working remotely magnify or reduce these qualities?

Giving, taking and matching are just different styles of interaction that we bring to the workplace. Givers are people who by default want to know, “what can I do for you?” Takers are the opposite. They’re interested in figuring out “what can you do for me?” And then matchers hover in the middle of that spectrum and say, “I don’t want to be too selfish or too generous, and so I’ll do something for you if you do something for me”.

The takers may feel like they have a little bit more licence to shirk, maybe to steal credit for other people’s ideas. I think though, we’ve seen an incredible outpouring of generosity in this crisis. The givers really see this as a situation where they need to step up. They feel a sense of responsibility to try to help. My guess is that matching gets weeded out a little bit. I don’t think that most people operate like matchers because it’s their core value. I think people match because they’re afraid of the risks of over-correcting on either side. In these situations, people probably gravitate more toward fundamentally, am I more of a selfish or generous person?

One of the big frustrations for givers in a situation like this is they don’t always know where they can help. A couple of years ago, I cofounded a knowledge-sharing platform called Givitas, to make it easy for people to seek and give help in five minutes a day or less. I would love to see more of those kinds of efforts to make sure that we can make people’s needs and requests visible, so that the people who have the motivation and the ability to contribute are able to direct their energy in the way it’s needed.

You said recently that interruptions are part of our new reality. Many people are struggling with distractions and procrastination. Are there ways to make ourselves more resilient to this?

I don’t know that that resilience is possible when it comes to interruptions, because the problem is less that they’re a source of hardship; it’s more that they’re distracting and it’s hard to get back into the task. Probably one of the best things we can do is try to find a sense of self-compassion.

Psychologists like Kristin Neff say, “think of the kindness that you would show to a friend who was in a situation like yours. What happens if you apply that same kindness to yourself?” When we get interrupted, instead of getting frustrated, I can say, “okay, this is a really difficult time right now”.

Interruptions are part of the human condition. They are an intensified part of the human condition during a pandemic. I know I’m not the only one facing these. Let me just see if I can get through today without losing control. If I don’t succeed today, I’ll try again tomorrow. When we don’t beat ourselves up like that, it’s a lot easier to move forward as opposed to wallowing in the challenges we’ve faced in the past.

Is there anything positive that may come out of this crisis?

We’re going to see a lot of employers embrace more flexibility around working from home and having virtual teams. They’re going to find out that it wasn’t as impossible as they thought it was, and there are some productivity gains that come from not having to commute, and getting to work where you want.

On an individual level, unfortunately, there are some people who are going to face post-traumatic stress. The encouraging news psychologically is over half of people report a different response to trauma, which is post-traumatic growth. Post-traumatic growth is the sense that, I wish this didn’t happen but, given that it happened, I feel like I am better in some way. It might be a heightened sense of personal strength; it could be a deeper sense of gratitude; it could be finding new meaning, or investing more in relationships.

Being so eager to get back to normal, having gone through this long crisis, how do we make sure that we learn from this experience?

Learning from an experience like this comes from reflection. As people come out of this crisis and start coming back to work, the first thing that I would do is have a discussion about what everyone learned from the experiments they ran. Some of those experiments were by force, others were by choice, but we’ve all had to test out different routines and the way we work.

I’d want to hear what everyone tested out, what worked and what didn’t, and then keep evolving what we thought were our best practices in light of that. That would be something that you continue doing. Last I checked, experiments are the best way to learn.

Presumably there’ll be some powerful insights for you to learn from this whole experience?

There are going to be some incredible natural experiments that are already being run. They’re going to be analyzed, and we’re going to be able to see what’s the effect of having to work from home on productivity at a scale that’s never been tested before. We’re also going to learn something about what happens to people’s creativity and connection when they can’t interact face-to-face with their colleagues.

There’s a whole group of organizational psychologists, as well as sociologists and management professors, who are going to spend the next five, 10 years studying the effects of this pandemic in different places. In a way, another form of post-traumatic growth is we gain new insights about how to work together effectively from a distance that we wouldn’t have had access to otherwise. And I wish we didn’t have access to it. I’d rather not go through this crisis. But given that we’re stuck with it, we might as well try to learn from it.

The Future of Management

I’ve just read a great interview with management guru Charles Handy here.

Here is a great quote from that interview:

“In this disentangled world, people try to talk about agile management as a solution but management is the wrong word. It only makes sense when it is applied to things; you can manage a communication system, you can manage resources, but you can’t manage people.

Management is about making sure that people have the right ammunition to fire the Kalashnikov; leadership is about making sure they use it for the right purposes and don’t shoot their team” – Charles Handy

One core question might be this: Is there still a place for management as we knew it, and if so, what does it look like going forward? This is what most leaders, consultants, management thinkers and more are questioning at the moment.

I’m working on some perspectives so I’ll be sure to share them here soon.

 

What Digital Really Means

“Everyone wants to go digital. The first step is truly understanding what that means” – McKinsey

I was talking to a COO of an off-shore investment bank yesterday and he mentioned something which gave me the impression that his bank did not understand what ‘digital’ really meant. According to McKinsey:

For some executives, it’s about technology. For others, digital is a new way of engaging with customers. And for others still, it represents an entirely new way of doing business. None of these definitions is necessarily incorrect. But such diverse perspectives often trip up leadership teams because they reflect a lack of alignment and common vision about where the business needs to go. This often results in piecemeal initiatives or misguided efforts that lead to missed opportunities, sluggish performance, or false starts.

As COVID-19 continues to rapidly accelerates the shift to building more digital capabilities within organisations, it is a critical time to take a step back and reevaluate existing efforts in light of the new challenges ahead. This means properly understanding what digital means, assessment of existing efforts, aligning to future strategy, and identifying what capabilities are needed across leadership, culture, and execution.

Whilst extremely hard, now is the best time to refocus efforts toward accelerating digitisation as the case for such change is for some a matter of survival. Think about how many food and other retailers are rapidly shifting to e-commerce models requiring new skills, software, tools and mindsets.

You can read more on this from McKinsey here

 

Reimagine The Future Online Conference

This Reimagine The Future virtual conference starts today and I have signed up for it.

It is being run by Thinkers50 and Outthinker and features 24 top management experts doing 24 sessions in 24 hours including Renee Mauborgne (INSEAD and Blue Ocean Strategy), Scott Anthony (Innosight), Daniel Pink, and Hal Gregerson. Recordings of every session will be available on-demand so there’s no need to be live.

All profits are going to a range of charities involved in COVID-19 relief. You can access tickets here.

Mental Health Impacts of COVID-19

On Friday I caught up with a friend who works at WhatIf (now owned by Accenture). We were talking about the impact of COVID-19 on the future workforce. He mentioned an interesting point around how the crisis could drive increased mental health impacts as employees (and companies) grapple with the future transition from ‘work-from-home’ to whatever is the ‘new normal’.

Some firms may stay as is, some may adopt a hybrid model, and some may go back to offices full-time. Whichever the model, each presents its own set of unique short-term challenges for staff and firms.

Gartner have a great article here discussing these issues further. It is called ‘Leading Your Employees Through The Emotional Side of COVID-19’. If you are leading or managing teams, I suggest you take a look.

The Challenge for Video-Conferencing Vendors

Yesterday I participated in a 4hr virtual symposium called ‘Disruption 2020’ run by the MIT Sloan Management Review. If you are interested in disruptive innovation and strategic management, this was a brilliant session with experts including Scott Anthony (Innosight), Amy Webb (NYU Professor and Founder, Future Today Institute), and Rita Gunter McGrath (Professor, Columbia Business School).

They have an edition dedicated to it which you can see here.

The VC session was run on GoToWebinar, one of the traditional VC incumbent firms founded in 2004. Unfortunately, the technology didn’t work that well. If I had to rate the user experience of the technology on a scale of 0-10, with 10 being perfect, I would give it a 5.

Every speaker and host (there were 8 or so speakers and 2 hosts) had issues. One had to drop out then come back in. A few speakers could only speak as the VC wasn’t working. Some had constant cutting out or freezing throughout.

It is unclear why these issues were occurring, and who exactly is responsible. Whether it is GoToWebinar, internet bandwidth, home wifi, 4G, human error or something else, this shouldn’t be an issue in 2020. For me, this feels like what dial-up internet was in the early 2000s.

Clearly these are the fundamental CX issues which have enabled a young start-up (Zoom) to rapidly scale across B2B and B2C with a powerful value proposition focusing on the B2B SaaS Playbook: ease of use, integrations, free or flexible pricing, and better performance. I wrote a post recently on how impressed I was a few months ago in being able to easily host a global conference hosted by Seth Godin with many hundreds of people.

Whilst Zoom is facing other challenges right now (e.g. security, privacy etc), from what I have seen with competing vendors, it will be around for a long time to come (and the others, won’t be).

Strategic Responses of Firms to COVID-19 Crisis

This week I developed and launched a survey designed to gather insight on how a range of firms in different sectors are responding to the COVID-19 crisis. If you are interested in completing it, the survey is here.

To provide more context, I’ve pasted below what is contained in the Introduction section of the survey:

Overview:
This survey seeks to understand what strategies, tactics and activities a sample of organisations large and small across sectors are undertaking to manage the current crisis. It is a project being run by Andrew Essa of ROCKET + COMMERCE (a management consultancy). An advisory board of cross-industry leaders is forming to interpret the results.

Geographies surveyed include firms based mainly in Guernsey and Jersey (Channel Islands), although there will be respondents from UK, EU, US, and APAC.

Timings:
The last day to complete the survey is 30th April 2020.

Interviews:
A number of short interviews via VC are also being conducted with select leaders or senior managers. If you would like to apply, please contact Andrew Essa via the details below.

Insights:
The results will contribute to a white-paper and new report series e.g. Disruptive Change 2020 Report. I will share these with all respondents in due course. It is expected to generate useful market insight for firm leadership on how your peers within or across sectors are managing and strategically responding to the crisis. The results therefore should improve firm decision-making in the short and long-term, including strategic planning, operational reviews or change management.

There may be further (e.g. 3+) surveys across the year to track strategic responses and changes over time as the crisis develops, but this will be kept under review.

Audience:
The target respondent is a senior manager, executive or experienced professional within an organisation. Firm sizes will range from international business to local SMEs, with sector coverage broad including Technology, Financial Services, Legal, Accounting, IT, Retail, Aviation, Health, PR, Government, Corporate & Fiduciary Services, Education, Charities etc.

Gig Work Acceleration

I came across an article today (here) in Forbes which summarised findings from recent PwC and BCG CEO surveys. Most of the findings were self-evident, especially around the acknowledgement of increased requirements for, and adoption of, independent consultants going forward during and beyond COVID 19:

  • More companies are likely to access freelancers both for cost efficiency and to supplement critical skill sets;
  • The 4th Industrial Revolution (4IR) offers interesting and important freelance work and lots of it;
  • Freelancers are a critical resource to more industries;
  • More areas of freelancing will grow in importance.
Source. BCG

 

It is hard to believe that a little over a decade ago, organisations weren’t able to easily access remote (or on-site) highly-skilled workers and teams using the internet (e.g. online marketplaces) or mobile apps.  Nor were such firms willing to do so, especially at scale and for a wider variety of higher-skilled freelance talent e.g. lawyers, management consultants.

As a lawyer in Australia and London in the mid-to-late 2000s, I remember that it was career suicide to turn your back on traditional law firms and pursue contracts with in-house legal departments. How things have changed!