Recovery Thinking
We are now (hopefully) about in the middle of the COVID-19 pandemic and it’s still a day-to-day situation. The first case in the US was confirmed on January 20. It’s hard to believe that it has been almost a quarter of 1 singular topic and news story. The Government just signed a $2 Trillion stimulus package and in typical government fashion, it’s full of unrelated spending that adds to our National debt but that’s a whole other conversation – don’t get me started.
I hope everyone is out there holding firm and getting along ok through this challenging time. We have talked a little bit about keeping your rhythms as close as you can to normal and getting together with your teams to keep them plugged in and connected to each other and the organization. I hope those things are helping. These are the times to test our mettle a bit because while this week is hard, I can imagine week 16, or even week 25 (not sure how long it will last) will be much harder. So, let’s talk about what’s next and some ideas for you and your teams.
We have been working with and talking with our clients about the what-ifs. As you are having these weekly or twice weekly conversations with your teams, let’s talk about building some of these scenarios. This is a great chance for you and your teams to either remain or move to “offense” instead of “defense.” In this scenario, defense is waiting to see what happens with the COVID-19 situation and THEN deciding what to do. Our recommendation is to move to a more proactive stance and working what you will do if, so you aren’t forced to decide under the duress of making the decision right now.
General Eisenhower was credited with saying that the plan was worth nothing, but planning was worth everything. While I wasn’t there, I believe his point was two-fold. First, the plan itself is impossible to cover every potential scenario and things change constantly so the plan itself isn’t all that valuable. Second, however, the act of creating the plan where you get people to put their minds and energy towards something that is proactive instead of reactive is priceless.
With that as the backdrop, let’s talk about some of the ways that people are looking at this. This is not intended to be all-inclusive but more to give people some ideas of how it might impact them and their organization.
First, let’s think about time. Since no one knows and it appears that a lot of humans struggle with the concept of staying home for the greater good, you might want to look at things from a perspective of “What If?” in a length of time. What if this thing lasts 60, 120 or 180 more days? What would be the steps that you would take along the way? What would your organization look like if you couldn’t return to your office for effectively 6-months? When would you need to change and what would you need to change? How much of your work and your business could you convert to online if you had to? What would happen if you knew you could get back to the office in mid-May?
For some of you folks who struggle with the façade that you are in control, you’re not. Not even close. This is not about coming up with a perfect plan, it’s about coming up with a plan and milestones that will help you and your team stay focused on what’s next and how you might respond to multiple situations.
Waiting to see how bad things get before you figure out how you want to respond to things is a losing proposition. We usually don’t make our best decisions under the pressure of having to make the decisions right away.
Some of the other things we are looking at include:
Severity –How bad is the economy at the end of this? What if unemployment ended up at 10%, 15% or 30%? It was roughly 3.5% percent when this situation really got intense. Who are your customers and what would this mean to your business? Can you easily pull your expenses back to cover this situation? Can you realign your organization to that reduced revenue model? You may be faced with that situation, so doing that work and planning now is the correct leadership move.
What if your supply chain is permanently altered (your biggest 2 suppliers don’t survive?) This question (I wish) should be a more frequent part of all companies’ conversations. Whether your suppliers are foreign or domestic, it doesn’t really matter. What matters is if your business is dependent on any supplier and that supplier is your only single source, you are placing a very big gamble on that situation. If you haven’t already identified secondary suppliers, while things are in this lull, it is a great time to re-evaluate that situation.
What if you have single source supply from China and US and China relations continue to deteriorate? I’m not picking on China but given the current state of circumstances it is hard not to point to china. The relationship is not good. You or your customers are paying tariffs while the Chinese government pays the Chinese companies to off-set the tariffs on their end. You have an 8,000 – 12,000-mile supply chain in place, 1 single source supplier that currently doesn’t enjoy great relations with your government. Same as above, this situation is a great chance to give that situation a good hard look while this situation rages on.
What if your two biggest customers don’t survive it? This may be the hardest one, but again it is very necessary to evaluate. Many companies have a great deal of their business volume and revenue tied up in one or two customers. Now, you are faced with the idea of what if one or two of your biggest customers don’t survive or come out looking wildly different than they do now. How would you replace that revenue? Who are the potential customers you should be connecting with now? Who are your dream clients that you need to establish communications with now? These are the types of questions that you should be evaluating now while the economy is in this weird holding pattern.
And if you really want to get outside the box, think about this question.
Who are your competitors that may need to be considered an ally at the end of this? We will dive deeper into this one on a later blog.
I recognize that there may be people out there aghast at talking about business while COVID rages on and people are dying. I don’t mean to be callous and I’m not hoping to offend anyone, so if you are offended perhaps, I’m not a great source of information for you. For those of you who like looking dead at the problem and trying to guide your organizations through this, please carry on. This too shall pass, and it is up to the leaders for how good or bad the whole situation looks at the end of it.
Leadership isn’t now nor has it ever been for the faint of heart. It’s time for us to square up to this thing.
As the saying goes, the best future you can have is the one you create for yourself. It’s time to get to work creating it because our world has been permanently changed. As Thomas Payne said it’s time to Lead, Follow or get the hell out of the way.
See you next time.
