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Covid Transition: Reopening To A New Normal

Over the last few weeks, I’ve left the cocoon of my home and have ventured out into the world. I’ve flown commercially, stayed in hotels and eaten in restaurants. My most significant ‘ah ha’ moment through those experiences is the realization that a Covid-driven ‘new normal’ won’t become real for consumers until they directly engage with businesses and the community.

To this point, considerations of what the new normal should look like as we work to reopen our economies has been largely theoretical, driven by teams of decision makers gathered together via Zoom or Hangouts. But scenario analysis and what-if planning can only take your business so far. It’s only when consumers begin interacting live and in-person with your business that the true variability and diversity of opinion and behavior becomes evident.

You’ll notice I’m not using the phrase ‘post-Covid world,’ as a vaccine is not yet available and general societal acceptance of increased health risks is still largely in question. We will be living in an uncomfortable, transitional state for some time – likely well into 2021.

As we all grapple with how best to lead our teams through this transitional phase, I want to share some thought-starters for leaders to consider as your business ramps back up during the Covid transition:

• Philosophy: What do you want your business to stand for during the Covid transition? In my travels, I’ve seen a wide variety of approaches, from highly conservative to wildly liberal. From this consumer’s perspective, there is a balance to be struck between the two in which you show your business cares about the health and safety of its customers and desires to get itself and the economy moving again. If your philosophy is too conservative, your business will appear unapproachable and difficult to do business with. Too liberal and you’ll send a strong message that your business doesn’t care about the subset of your customer base who’s opinion bends toward safety and security. Those customers are likely to leave you for other alternatives.

• Communication: Your clients, employees and partners want to know your philosophical stance. They want clarity regarding how they should engage with your business as you begin to reopen. This is all against the backdrop of a very fluid environment of rapidly changing regulations, healthcare advice, and public opinion. I’ve seen businesses communicate with their customer base once or twice since early March and assume that’s enough. My recommendation is to invest in more communication across multiple channels to keep your message fresh and relevant so your customers know what to expect when they interact with you. Remember that your customers need to interpret many different messages from myriad business and government leaders. Yours needs to stand out.

• Agility: In March or April, you probably measured the sentiment of your employees and customers about return-to-work and doing business with you during the Covid transition. While that data may still have some relevance, I’m confident there are many consumers like me who won’t truly know how they will behave until they move from the cloister of their homes and back out into the wild. While it’s a well-known fact that consumers dislike being over-surveyed, this is not the time to pull back on your efforts to seek to understand rapidly-shifting consumer behavior in new and creative ways.

• Employee Engagement: Your employees are humans with the same shifting opinions and emotions regarding what a Covid transition means to them as your consumers. Some of them are scared, some want to move forward like nothing’s happened. While there are a wide range of opinions that exist amongst your staff, they are all emotionally drained and some will exhibit signs of emotional exhaustion. This means the amount of discretionary energy your people have to give your business is low relative to what it would be under normal operating conditions. Your people likely want to work hard and do a good job to keep their jobs, but the distraction of a 24 hour news cycle and the constant threat of a silent killer is weighing heavily on them.

• Policies: Since your employees will not be performing at peak levels during the Covid transition, ensure you’re setting them up for success by creating clear goals and policies. My recent interactions with a national hotel chain and a rental car company put this issue into full view. In both cases, it was clear that management had not carefully thought through the new procedures that were necessary for efficient processing of guest interactions and had left too much decision-making in the hands of very junior staff members with little to no training. This lack of clarity created both customer and employee dissatisfaction that was displayed publicly. The brand damage that results from looking disorganized and sloppy is difficult, if not impossible to repair.

• Technology: I recommend making investments in lightweight, touchless technologies to eliminate direct customer contact whenever possible. For the last few years, I thought that the QR code was dead, but it’s made a surprising resurgence. Another silver lining of the Covid crisis is that the U.S. may finally catch up to the rest of the world in the adoption of tap-and-go payment systems. In traveling across the globe, I find it embarrassing how far behind we are in the use of these technologies.

The next eighteen months will be an incredibly difficult time for all of us. In addition to Covid, we’ll be navigating through a presidential election cycle, economic challenges and continued social unrest brought about by systemic racism and police brutality. To ensure your business is set up for long-term success, focus on the above points will help guide you through the Covid transition.

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You Can’t Manage Your Way Out Of A Crisis—You Have To Lead

The worldwide containment effort to halt the spread of COVID-19 has had far-reaching impacts on both the world economy and local communities.

Our lives have been significantly altered and the economy has been severely impacted, as reflected in the Dow Jones Industrial Average, which was down nearly 30 percent before partially recovering recently. In addition to our 401ks quickly shrinking, job losses have accelerated over the last two months with real unemployment now over 20%, levels not seen since the Great Depression.

There is no doubt that the coronavirus pandemic qualifies as a crisis, and that it has and will cause many hardships for people. But a crisis also creates opportunities for leaders. President John F. Kennedy said in a speech in 1959, “The Chinese use two brush strokes to write the word ‘crisis.’ One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger—but recognize the opportunity.” While Chinese language scholars have since explained that this interpretation might not be completely accurate, his point has never been more relevant: a crisis is an opportunity to lead.

Leaders vs. managers

Functionally, managers and leaders apply different approaches in pursuit of different outcomes. Managers get people to follow rules and procedures in an effort to reduce risk and deliver predictable outcomes. Managers view variability as a threat to be reduced as much as possible. A crisis creates change that often overwhelms most management systems.

Leaders, on the other hand, rouse others to take risks and challenge the status quo in an effort to achieve something new and better. Leaders view variability as an opportunity to achieve results that others think are impossible. A crisis is an incredible leadership opportunity.

Companies are filled with managers who have good intentions but are often unable to convince themselves to take a risk. They’re part of a culture that rewards hitting your goal, not taking on challenges that might be hard to solve. They accept boundary conditions for what they are—limits on what’s possible. While this structure works well when the objective is to maintain some semblance of the status quo, it often fails in times of crisis. Since crises don’t resolve themselves, somebody has to step up and find a solution to the new set of circumstances.

During times of uncertainty, a simple truth reveals itself: You can’t manage your way out of a crisis; you have to lead.

Crisis creates leaders

In the early 2000s, William Clay Ford Jr. was the CEO of Ford Motor Company and great-grandson of company founder Henry Ford. During his tenure as CEO, he tried to focus the company on making great cars instead of remaining mired in internal politics and infighting, but without much success. Then the Great Recession hit in 2007. Ford had to convince his family members, who controlled almost 40 percent of the company voting shares, to allow him to pledge the trademarked blue Ford oval as collateral for a financing package to help the company survive the downturn.

Saving the family legacy became more important than the internal politicking that had plagued the company in the past. This gambit created a renewed sense of focus and willingness to take risks that allowed the company to break through the decades-old management barriers and enabled the incoming CEO Alan Mullaly to make real changes.

Ford is an excellent example of how a crisis creates incredible opportunities for business leaders. It creates an environment that, under normal circumstances, is nearly impossible to replicate. A crisis shifts the organizational mindset in three important ways.

1. An increased appetite for risk. During normal times, business decisions are based on some type of risk/reward analysis. Is the potential gain enough to outweigh the risk of failure? In practice, the fear of failure almost always overrules the argument for change. As a result, most organizations are inherently risk averse.

But in a crisis, the dynamic shifts dramatically. When everything stops working as expected, risk becomes less risky. Change becomes not something to be feared, but rather a strategy to possibly make things better. These new ideas may not work, but they become much better options when the status quo is failing. When an organization realizes that there’s almost no downside to taking a chance, then everything starts to become possible and the real risk becomes doing nothing.

A crisis creates an opportunity for leaders to convince others that it’s in their best interest to embrace change and take risk.

2. A renewed focus on what really matters. Most organizations evolve over time to become good at managing competing, and sometimes conflicting, priorities. For a variety of reasons, once something makes the list as important to do, it becomes almost impossible to stop doing it. As a result, organizations allocate resources across a range of priorities, even though some are clearly far more important than others. By default, this reduces the focus on the best ideas.

However, a crisis fundamentally shifts this balance. When your back is up against the wall, the only priority becomes survival. You have no choice but to direct all of your attention to the problem that really matters. This focus is an extremely powerful tool that can give ordinary people the ability to do the extraordinary — especially when people’s jobs are at stake.

A crisis enables leaders to focus everyone on what really matters and to eliminate distractions that might otherwise get in the way of the goal.

3. A reevaluation of mindset. According to the consulting firm McKinsey, 84 percent of executives agree that innovation is critical for their business, but only 6 percent are satisfied with their performance. It seems that the more people try to implement processes to be more innovative, the less they actually do it. The problem is not the process, but the people following it — and more specifically, their mindset. But someone’s mindset does not easily change on its own.

When an organization faces a crisis, the people inside it are forced to reevaluate how they think about their work. This opens the door to shifting the entire mindset of the organization. Values may change from collegiality to brutal candor, from compliance to rewarding initiative, from valuing learning more than being right. If you’re satisfied with how things are, you will never motivate others to overcome a crisis — because innovation requires a mindset to pursue the impossible, and that mindset starts with the leader.

A crisis forces leaders to reevaluate their mindset and create an environment where success is the only option.

Perspective is a choice

You have a choice in how you view this crisis. In fact, the opportunity actually lies in your perspective. As John Wooden, the legendary UCLA basketball coach who won 10 national championships in a 12-year period once said, “Things turn out best for the people who make the best of the way things turn out.”

A crisis is the perfect time for people to take more risks, focus on what really matters and embrace the opportunity to lead.

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A Radical Testing Solution to Reopen the Economy—Now

As the country begins to seriously discuss how best to get the economy moving again by reopening businesses, the wild card remains the potential for re-igniting COVID-19 outbreaks. While there has been a great deal of progress made in slowing the progress of the virus in the nation’s big hotspots, the question of what happens when social distancing is reduced remains unknown.

Laurence Kotlikoff, professor of economics at Boston University, thinks he has a solution: test groups of Americans for COVID-19, not just individuals.

“We have the potential to end this thing in two weeks and get everyone out of their homes and back at work,” says Laurence Kotlikoff, professor of economics at Boston University. “The key is to mandate that every single American is tested in large groups at once, and then to isolate infected people from those who aren’t.”

It’s a message Kotlikoff has been disseminating globally in making the case for an innovative group coronavirus testing process he developed with his brother Michael, a professor of Molecular Biology and provost of Cornell University. His prediction for recovery hinges on how federal and state governments respond to the pandemic.

Three Other Plans for Reopening The Economy: 

Group testing is a vastly more efficient process than individual testing, explains Kotlikoff, who outlines an aggressive testing and response program aimed at combatting infection. By swabbing the mouths of 1,000 people at once—grouped, perhaps, by voting districts—the tests can be pooled for a single aggregate view of the findings.

Each group would be tested twice. If the entire group isn’t infected, they’re good to go and can return to normal life. If one person in the group is infected, the second swab of each person would be tested to identify who is infected.

“We could test the entire U.S. population in a single day and then quarantine all the infected individuals immediately at hospitals, homes, hotels, community centers and the like to stop the spread,” Kotliokoff says. “Obviously, for it to work, we need strict compliance, oversight and medical monitoring.”

People found to be free of infection would be given a green ID badge or bracelet to wear at all times, allowing them to return to work, he suggests. “My hope is for daily testing, preferably by the military, on a household-by-household basis at election polling places and other local venues. Will this be costly? Yes, but nowhere near the costs of a business shutdown lasting months and months.

“If the government takes our advice—and we’re receiving lots of positive comments—I predict a V-shaped recovery, with the diagonals coming so close together it looks like an I,” he says.

Kotlikoff is calling on CEOs to help get the message out and press for aggressive action. “If the government dithers and doesn’t set this up, or people think the idea of requiring green bracelets is ridiculous, then we’ll just keep plodding along,” he says, adding that the private sector has the power to make a difference on a global scale.

“If we do things right here, then companies across the world will follow our lead, including those in emerging economies suffering the most. We can get the entire world back to business in two months, six at the most if we have a really bad depression.”

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Leading In A Crisis: Embrace The Uncertainty

Despite a host of warnings about the impending COVID-19 crisis, it caught most of us by surprise. I recall attending the regular leadership team meetings of a few of my clients the week of March 9th and by March 15th, the world had changed. It was no longer a potential crisis; it was a full-on global pandemic where new terms such as ‘social distancing’ and ‘flattening the curve’ became part of our lexicon. A spectrum of responses emerged from reactive chaos to deploying well-practiced business continuity modes.

The challenge that leaders face in a crisis is that their organizations aren’t typically set up to operate with such uncertainty. Leaders create visions, plans and metrics to attempt to control their environments and minimize uncertainty as best they can. In a crisis many leaders default to what they know how to do in order to reduce frustration and quell their own and others’ fears.[i] This default mode is simply not productive and rather than reduce uncertainty and anxiety it increases both.

Today all organizations are faced with a new normal—uncertainty and inability to control the environments in which they operate. We know the pandemic will end but it won’t truly be over until a vaccine is available. We know the ‘curve’ will eventually flatten but projections seem to change hourly. We know people will get back to work but we don’t know whether social distancing will continue to influence the economy. We know that remote work is possible on a broad scale but it’s not clear if this will work long-term.

Ralph Stacey and Douglas Griffin’s definition of a leader is one that lends itself to today’s environment: “One recognized as a leader has a greater capacity to live with the anxiety of not knowing and not being in control. The leader is recognized as having the courage to carry on interacting productively and creatively despite not knowing.”[ii] This definition certainly applies to today’s environment of tremendous uncertainty and great anxiety. Clearly there is much we don’t know about what the future will hold. It is also clear that leadership today requires an ability to embrace uncertainty and interact productively.

While it’s a relatively small sample size, we have been amazed by the approaches our clients have taken to navigate their way through these challenging times. None have had an easy time, and some were certainly more prepared than others, but most have quickly overcome their natural tendency to control and shifted to doing their best to operate in crisis mode. In each case a few important themes emerged for how to embrace the uncertainty – humility, transparency, engagement, focus, and patience.

Positive humility. In their own ways, each CEO acknowledged their fear about the unknown and that they didn’t have all the answers, but they exuded a sense of calmness and confidence in their organizations to work smart and hard to get through the crisis. By reinforcing and modeling positive humility CEOs have established a tone for their leadership teams to cascade throughout their organizations.

Transparency. CEOs and their leadership teams are proactively communicating difficult information openly and being clear when they don’t have answers to important questions. For example, they are not promising that no jobs will be lost but they are committing to pursuing all avenues necessary such as the SBA CARES Loans to secure jobs as long as possible.

Engagement. When in doubt these organizations are doing their best to negotiate clear expectations (i.e., daily check in sessions with supervisors) and over-communicate (i.e., using email, internal web site, and supervisors to reinforce that hourly workers will be paid weekly). They are also encouraging managers and staff to use multiple channels to remain in contact both formally and informally (i.e., Virtual Team Meetings, Virtual happy hours, random watercooler calls).

Focus. After a short period of getting their remote offices working, CEOs and their leadership teams redoubled their efforts to ensure their organizations remained focused on the core mission (i.e., executing loans, building interiors, registering / renewing members). They also reinforced that today’s plans would likely change tomorrow and that learning from mistakes and helping employees and customers manage uncertainty is a bit part of their jobs.

Patience. In a crisis adults often revert to overdone strengths – people who are naturally decisive might become arrogant or people who tend to be naturally empathetic might become overly protective. These CEOs and their leadership teams recognize this tendency to revert. They are working hard to have patience with each other by giving space, not overreacting themselves and providing gentle feedback.

These are extremely challenging times and despite efforts by the smartest scientists, economists and business leaders in the world there is no clear path to when things will get back to normal. Ambiguity is a daily obstacle for most business leaders but today we are dealing with ambiguity on steroids. It is not easy but we are so encouraged to see so many CEOs and their leadership teams embrace the ambiguity to help their organizations get to the other side of this crazy time.

[i] Ronald Heifetz, Alexander Grashow, and Mary Linsky, “Leadership in a (Permanent) Crisis”, Harvard Business Review, July-August 2009.

[ii] Ralph D. Stacey, “Complexity and Management: Fad or Radical Challenge to Systems Thinking?”, Routledge, 2000.

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Unprecedented Times Call For Unprecedented Compassion

“Unprecedented times.”
I hear this phrase repeated by virtually every political and business leader. To people who are not in positions of power, the phrase can be intimidating. The word “unprecedented” is defined as “never been done before or known before.” It implies to those you are trying to lead …

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Moving To A New, Post-Virus Normal

I’ve heard Wall Street refer to the current health and financial crises as “caused by G-D”. While I understand what they are trying to say, this is not G-D-caused; it is caused by a species-jumping virus. A month ago, our immune systems were capable of warding off previously known …

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How One CEO, Positive For COVID, Is Continuing To Lead

The coronavirus pandemic has touched every aspect of our lives, and each day, the devastation creeps closer and closer to home (if it hasn’t already barged in). Through it all, my company has thus far been very fortunate to keep moving forward, with a team that adjusted very well ( …

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Diversity: A Must-Have, In Good Times and Bad

A successful workplace must feature a diverse set of people empowered to solve their sector’s most challenging problems. More than a “nice-to-have,” diversity is a “must-have” for all sectors and industries committed to progress.
This holds true in both good times and bad. In fact, when an unexpected crisis …

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GM’s Ventilator-Making Effort Is Working On Many Levels

It’s not quite the stuff of the “Arsenal of Democracy,” but the pivot by General Motors and Ford to scale up manufacture of badly needed ventilators in concert with existing makers is emerging as a major demonstration of how America’s industrial might can help the nation rally to …

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