Riding It Out And Rising Again: Strategies And Capabilities Of Resilience And Recovery

 

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People talk about a war against coronavirus, but this is not a war; it’s a public health crisis. And it will be followed by the worst recession since the 1930s, with the IMF predicting a 4.9% contraction this year.

As leaders, we should assume both the virus and the recession will be long term and reimagine our organizations to ride it out and eventually recover. For those who get this right, it will mean not just survival, but also the opportunity to secure a sustainable competitive advantage.

Acrobatics by industry

All industry sectors have pulled off unbelievable feats of acrobatics over the last few months, which proves we can pivot far faster than we thought. We’ve seen responses in the sectors we focus on differ according to the demands they faced and their technical — and psychological — readiness to adapt.

Higher education has had to reimagine its entire business model, with the UK's Aston University Engineering Academy reconfiguring its facilities for the return of students and British Colombia's Selkirk College putting some of its courses fully online. All while the sector is facing a crisis in foreign student income and is busy developing a Covid-19 vaccine.

In local government, we've seen a sudden willingness to place greater trust in the abilities of IT partners. In Europe, the sector’s long-standing insistence on in-country data centers is relaxing as it comes to accept that as long as the data center is secure, located somewhere in the EU and the partner can control the location of data in the cloud, they will still be compliant with GDPR.

The nonprofit sector is holding on to its income surprisingly well because the public has been more inclined to donate to charities since Covid-19. But it’s facing changes in the kinds of services it needs to provide. Save the Children, for example, is finding new ways to protect children vulnerable to domestic abuse while schools are closed. It can respond effectively to new demands like this because it has the technical ability to set up and resource new projects quickly.

Post-Covid-19 Business Strategy

I've found it very helpful over the last few months to exchange views with other CEOs in peer-to-peer discussion groups and to turn to recognized sources of inspiration like McKinsey & Company. Here are the main points that have resonated with me:

• Rapidly recover revenue. Adopt a startup mindset. Set clear, simple goals. Build focused, empowered teams, and enable fast decision making. Then, rethink your organization based on how your people work best. This is what I call people experience: the principle of designing processes and technology around the way people want to work.
• Rebuild operations. All businesses need transparency of capital and operating expenditure, which a sound financial planning and analysis system can provide. Try to turn fixed costs into variable costs by exploiting as-a-service commercial models. Embrace the new future of work by using AI to power more automation, digital tools to enhance employee engagement and digital training systems to cross-skill your people.
• Rethink the organization. Ask yourself:
• Who are we? It helps to have a clear sense of identity, a shared purpose and a cohesive culture.
• How do we work? Covid-19 has shown us the value of matching the right talent to the task, regardless of formal position in the organization, and giving authority to small, nimble teams to make bold decisions quickly.
• How will we grow? Analyze data to get insight and take action quickly. Your product road maps might need to be very different from what you came up with at your last strategic away day.
• Accelerate digitization. To implement the reimagined organization, you’ll need to accelerate the modernization of your technology. Increase your adoption of cloud, AI, automation and digital assistants. Refocus your digital projects to address post-Covid-19 customer expectations, such as contactless service propositions.

Post-Covid-19 IT Strategy

The immediate knee-jerk reaction of most CIOs was to stop spending, put all projects on hold, enable remote work overnight, and beef up bandwidth, security and resilience.

The next stage will be to rethink IT strategy after Covid-19, and this will feel entirely counterintuitive by contrast. The essential thing is to keep innovating. Migrate further and faster to the cloud. Embrace as-a-service models. Make fixed costs variable; look for PAYG commercials. And double down on digital transformation.

I believe the business systems we’ll need in the post-Covid-19 world will combine workforce, financials, and logistics and use fast-track templates and implementation methodologies to speed up time to value.

A new wave of technology has followed every recession. The recession of the 1980s was followed by client server. The one in the 1990s was followed by the internet, and the age of the cloud followed the 2008 recession. I predict the recession of the early 2020s will spur the age of analytics and automation powered by AI.

Five A’s Of Resilience And Recovery

I don't usually go for formulas, but if ever there was a time for breaking your own rules, this is it. These are the capabilities I think you need to be resilient:

1. Accessibility. Embrace cloud IT — it’s accessible anywhere and easy to scale up and down.
2. Adaptability. Adopt software that’s quick and easy for your in-house team to change without depending on external consultants.
3. Analytics. Invest in skills and systems to understand what’s happening so you can take reactive or proactive action
4. Artificial intelligence. Use AI to spot patterns, handle complexity, learn and adapt fast.
5. Automation. Use digital assistants to automate routine tasks and free up your people to innovate.

Cause for optimism

This situation has a tragic side, but it also has potential positives. The first phase of the Covid-19 shake-up called for genuine empathy and practical action to protect your people and your customers. The next phase calls for bold, decisive action: Tear up your product road maps, and listen to what customers need next. Be offensive while being defensive. And focus on quality because customers are less tolerant of mistakes in recessions.

About the Author

Mike Ettling

Forbes Council Member/Forbes Technology Council.

CEO of Unit4, transforming the People Experience of enterprise software.

I’m CEO of Unit4, Investor, builder of world-class teams, champion of diversity and continuous learner, and I’m passionate about people. From my first leadership role in the Boy Scouts, to exec positions in the tech industry, my career has revolved around elevating, engaging and enabling people. I joined Unit4 to get the market as excited in our unique approach to enterprise tech as I am. We’re building systems that change how people experience work, and the impact will be huge. Outside of work I’m a family man, a Liverpool supporter, and a proud South African.