In my client update sessions, I’m hearing it clearly: it feels for all the world that the anchors are not holding and our businesses are awash. Yet when we step back and look through an objective lens, we find that clients are still seeking value, we do have significant control, and we can guide to a better outcome.
This COVID-19 purgatory stage has been hard on everyone. We are all working on keeping ourselves, our families, and our communities safe and productive which adds a huge cognitive load that wasn’t there just six months ago. All the changes in routines have made almost every forecast void, and it can seem like we are being tossed in a roiling sea with no true North or anchor points.
In my conversations with leaders of larger firms that have substantial assets and momentum, I frequently sense that they are “waiting” for certainty to return. There is an expectation that we’ll find a tipping point, and all will be well. At an emotional level, I get this, as the touchstone of recurring value creation was repeatedly sustainably mined from their market knowledge and access – and this pandemic has them rightly wondering whether that knowledge is still valid.
History of past economic and disruptive events argues for a different approach. Only in the rearview mirror (in economics the distant rearview mirror), do such turning points become clear. As we are living through them, we see no signposts, but instead, see layers of progress built on individual and collective choice-making.
In many cases when we look at the firm’s objective performance, they have been able to get cash positive and remain a robust part of the supply chain.
Yet, it’s a time when feelings are leading them into the wrong context for decision making.
Shifting from Certainty to What We Can Control
Once we’ve unpacked that they are in fact in a position to define their path, the conversation turns to how to productively use the momentum they’ve built in a time of some strategic uncertainty.
Typically we talk about three areas of focus: stewardship, traction, and stability.
Task One is Stewardship
Why it’s important: Setting a tone of applying resources in support of your core stakeholders is fundamental to building a base during challenging times. It puts the conversation on the basis of service, not preservation. This leads to much better decision making.
What this involves: This involves a solid scrub of the firm’s pre-COVID initiatives and investments in the clear light of today’s fresh reality. We develop a set of evaluation questions and rate and rank each material investment. For example, one question might be, “will this investment make us more able to serve our clients’ needs digitally?” Another dimension is locking in customer experience as it relates to how we are delivering our services right now and so on.
How it’s beneficial: By laying the foundation it allows everyone in the firm to contribute the skills, insight, and observations to build a new future. It puts a very beneficial “pull” on the system.
Task Two is to Work to Assure Traction
Why it’s important: Frequently during stressful times, a firm can oversubscribe its team members. This invisible load slows completion of key actions and extends the cycle times of commitment to cash.
What this involves: In short, this is about removing excess work to allow completion of the high impact items before adding more tasks to the system. It’s asking the question: “Have we provided all the resources needed for the highest value projects to be completed fully and on an assertive timeline?”
How it’s beneficial: Locking in the highest paybacks will lead to a waterfall effect sooner that will materially improve the P&L.
Task Three is to Provide Stability for Team Members
What this involves: Making clear commitments to resource levels and reducing the anxiety of teams and subject matter experts.
Why it’s important: Contrary to the “glory stories” of entrepreneurial risk-taking, many very talented people want to work on a platform of relative stability. Your balance sheet gives you the opportunity to invest strategically and in a sustained way rather than, like an early-stage firm, worrying that you may not have enough cash to make payroll.
How it’s beneficial: There are two benefits. First, it allows individuals to set aside the unspoken burden of “keeping their options open.” Secondly, by becoming a team of choice, it’s a very good time to attract new talent to your team.
The Need for More Flexibility
The current environment demands much of leadership – and we need to respond with investment and decision making processes that are adaptive. One firm I’m working with is doing a rolling 90-day operating plan, that allows for resource stability, while remaining nimble on scope and direction.
It’s About Momentum and Trust
You’ve earned the right to use the momentum you’ve built to have sustainable adaptability during this pandemic. The other side of the coin is that momentum does not entitle you to success and that you need to continue to do the decision making and risk-taking that first got you to that place.
This leads to the last point: it’s about trust at all levels. Great team members are always in demand, and unless they see the full team executing at a high level and continuing to invest in the future, they will get restless fast. This period of the pandemic is very anxiety-producing, so be confident that your best team members are watching carefully.
Putting a Plan in Place
I take on a limited number of advisory and project clients, using facilitation tools, checklists, and processes honed through dozens of assignments (and they work great virtually :-)). If you’d like to talk about how an advisory or consultative approach could allow you to build sustainable momentum through the pandemic, please reach out to scott@scottpropp.com or put a 20-minute appointment on the books using this link.
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