CAPITAL CORP. SYDNEY

73 Ocean Street, New South Wales 2000, SYDNEY

Contact Person: Callum S Ansell
E: callum.aus@capital.com
P: (02) 8252 5319

WILD KEY CAPITAL

22 Guild Street, NW8 2UP,
LONDON

Contact Person: Matilda O Dunn
E: matilda.uk@capital.com
P: 070 8652 7276

LECHMERE CAPITAL

Genslerstraße 9, Berlin Schöneberg 10829, BERLIN

Contact Person: Thorsten S Kohl
E: thorsten.bl@capital.com
P: 030 62 91 92

01-4544-044 | enq@sigma.ng

Reopen AND reinvent

Corona Virus, Enterprise, HR & Organization, Strategy & Consulting

Just weeks after winding down their operations, companies are being asked to restart their engines at an unprecedented rate as lockdown rules are gradually relaxed. The challenge is complicated by uncertainties about the progression of COVID-19 and the social, political and fiscal actions that it will drive.

Reopening requires more than a return to normal, however, because the unpredictable and long-lasting period that follows this pandemic will feature fundamental changes to economic activity, fast-changing cultural norms, societal values and behaviors. To reopen and to outmaneuver uncertainty also requires a program of reinvention.

This presents an opportunity—and a need—for many companies to build the competences they wish they’d invested in before: to be more digital, data-driven, and in the cloud; to have more variable cost structures, agile operations and automation; to create stronger capabilities in e-commerce and security. This agility will be core to the long-term capabilities they build. Leaders should consider the steps they take to reopen as the first in a long journey of wider transformation.

Preparing against scenarios

CEOs must reopen without knowing how the pandemic will play out. There are a range of potential scenarios based on the evolution of the virus itself and the nature of the social response.

Cyclical outbreaks
Infections are controlled in past locations but spread to new hot spots and rebound in old. Patience wears thin with social distancing, opening societal fissures.

Rapid remission
The disease is contained and life returns to normal swiftly. Government measures work quickly to stabilize the economy.

Prolonged chaos
Effects to control the virus seem useless. Governments and societies are strained to the point of breaking. The economy is limited to necessities only and inflation soars.

Flattened curve
The rate of infections is slowed but does not go into remission. The economy shrinks in near permanent ways. Society bends but does not break, pulling together to sustain government measures.


Not just a (Re)Opening: A New Beginning

Given the circumstances, business leaders have three priorities:

Navigate uncertainties

Given the range of potential scenarios, companies will need to be prepared to change course on a dime. Any steps that are taken to reopen should therefore be easily reversible and scalable.

Mitigate immediate challenges

Companies will have to provide a safe and secure work environment, communicating with their workforce transparently to build trust.

Build a better future
Companies should not reopen by reverting to old ways. The reopening is an opportunity to create a better future for employees and customers.

Commit to active reinvention

A program of active reinvention that outmaneuvers uncertainty starts with these five areas:

01. Put People First

Today, we see that shared humanity at work can make all the difference in this crisis. Companies need to go beyond the transactional to truly understand their employees if they want to create productive, inclusive and rewarding working environments for the long haul. ​

  • Communicate with compassion and confidence
    • Our COVID-19 consumer research found that over 64% of the global workforce is facing high anxiety over their personal job security. Others are worried that traditional social interaction may no longer be possible.
    • Proactively seek feedback from employees and give them a voice.
    • Find the right ‘glocal’ mix of leadership, delegating where appropriate but providing central guidance and coordination.
  • Build trust with your people through your purpose

Living your purpose motivates people to persevere with a challenging journey of change.

  • Address the deeper needs of insecure workers

Turn furloughed workers into flexible workers, retraining them in skills that enable them to refocus on areas of higher demand. Offer learning programs and career pathways to affected people.

  • Care about more than your employees’ work problems

Offer life coaches, mental health support and wellbeing programs to help grieving employees or those managing stress, such as those caring for elderly patients and partners of key workers. Honor losses. And ensure leaders share their own COVID-19 experiences.

  • Support households, not just employees
    • Work may open, but schools and elderly care may not. 67% of American children under six have all available parents participating in the workforce.
    • Revisit policies, focusing on the most vulnerable groups, such as temporary workers, people with disabilities, single parents or those who lack adequate health benefits.

02. Design Spaces That Work

Create a safe working environment that gives people confidence to return to work premises and to adjust to the new virtual / physical hybrid way of working.

  • Sustain new digital workers. Redesign work.

49% of people in our survey who never worked from home now plan to do so more frequently in the future. Redesign work so that it can be completed more effectively from home. Train leaders to manage hybrid virtual / physical teams and extend technology support.

  • Rethink physical space and reframe needs
    • Create not just a safe environment, but a comfortable and stress-managed one as well.
    • Limit physical contact and enable more flexible use of space (e.g., operate shift hours). Segment key workers who must be physically present on the frontlines from those who can work remotely.
  • Help to secure the workplace of partners

Companies have an obligation to think beyond their employees. Seek to quickly meet your legal obligations as well as supply chain partner expectations. Consider the role of chief medical officer to manage health protocols for the organization and its interaction with the wider ecosystem.

  • Put security at the heart of workplace design

Extend protocols for data, network and systems security to manage use of personal devices and new collaboration tools.

  • Create a new employee contract based on mutual trust

Increased levels of employee monitoring and new security measures will demand explicit and implicit contracts with employees.

03. Solve in Phases

Plan for a phased return that responds to unforeseen events, slippage, and reversals. Take this opportunity to reengineer processes and to establish an agile operating model that provides flexibility to rapidly pivot to a remote workforce in response to dynamic market conditions.

  • Start with business strategy
    • Align critical processes with the business strategy and strengthen their resiliency.
    • Success depends on applying innovative solutions to create an evolved working environment.
    • With governments revising policies each day, local decision-making with central coordination is key.
  • Employ an agile, elastic workplace model
    • Create diverse teams that focus on key priorities across business functions, such as finance and human resources, to resolve new or unexpected issues.
    • Quickly identify cross-skilling opportunities.
  • Shift to a human-machine workforce
    • Make transactional processes more digital and focus on value-led, proactive operations―driven by data and analytics―to reduce stress on operations.
    • Free up talented people for more critical thinking.
  • Adopt a distributed global services model
    • Use a mixture of service models (office, home, countries and time zones) to de-risk the organization.
    • Bring together highly skilled, distributed teams that can log in anytime, anywhere and deliver on customer commitments.
  • Establish a virtual command center

Monitor and distribute work across the network in real time using a command center to measure quality, productivity, compliance, insights and intelligence, people engagement and workforce well-being.

  • Prioritize activities that create fuel for additional growth

Look to reopen the business components that generate cash and/or profits fastest to fuel next stages.

  • Secure the business at every stage of reopening

Companies should not allow their restart to get ahead of their ability to maintain a secure systems and physical environment.

  • Reconstitute leadership teams for reinvention​
    • New leadership skills will be needed in the reopening and beyond, requiring a different set of skills and leadership styles.
    • This is the time to identify and empower your most entrepreneurial and inclusive leaders.​

04. Commit to an Elastic Cost Structure

Shift from rapid cost reductions to building a resilient cost management mindset, and from balance sheet protection to long-term investment.

  • Lock down short-term cost reductions​

Consider second wave cost reductions. Restructure short-term debt to long-term agreements. Reduce SKU complexity to streamline cash management. Variabilize costs, including technology (e.g. software-as-a-service and the cloud), outsourcing and contractors.​

  • Establish elastic cost transformation culture​ ​
    • Create a culture of cost control ownership and a mindset of continual cost assessment. Clearly communicate how cost reduction measures will fuel investment.​
    • Invest in greater data intelligence to better adjust cost structures and manage liquidity. ​
  • Take a long-term, ecosystem view of M&A​

Balance short-term protection of liquidity with long-term investment and M&A need. Determine what M&A opportunities should be seized while distressed assets become available.​ Identify how M&A can improve cross-industry ecosystem capabilities that improve agility and resilience.

  • Manage government programs​

Assess government support programs and the possible obligations that could impact long-term liquidity or competitive agility. ​

05. Get Future-Ready

Long-term success of reopening lies in building new capabilities. This is the time to begin wider business transformation by leveraging new technologies at scale.

  • Listen to your customers… and respond quickly​
    • Seek to understand and empathize with customers, putting them at the heart of how you design—and constantly evolve—your customer experiences. Build more personal and less transactional experiences. ​
    • Invest in AI and other tools to manage customer interaction and to analyze customer behaviors. Provide frontline staff with the data insights they need to personalize experiences. 
  • Establish technology scalability with the cloud​​

Go beyond using the cloud to drive efficiencies in certain pockets. Migrate applications to the cloud at scale. And then embark on new ways—within the cloud environment—to drive innovation in the use of data and applications.​

  • Reinvent security for agile operations​

Manage the risks associated with large-scale workforce fluctuations. Look for supply chain weaknesses, counterfeiting and new cyberthreats in a less secure industry environment. ​

  • Build agile autonomy​

Underpin all areas of agility and experimentation with clearer empowerment of individuals and teams, supported by greater delegation and revised performance management metrics that reward autonomy.

Goodbye reopening, hello reinvention​

Reopening will be more than a restart. It will be the beginning of a new era of business. The rules have changed. Employee and customer behaviors have changed. ​​

But this creates new opportunities for organizations with the courage and foresight to change more than immediate needs demand. For example, many companies have moved partly to the cloud. But, having reduced costs in some parts of the business, now is the time to reinvent and scale cloud adoption across the enterprise, creating variable costs and increasing resilience. Those that can reinvent themselves—their processes, customer experiences, employee and social contracts, and do so in ways that further their purpose—will win. 

Outmaneuvering uncertainty—by mitigating immediate challenges and building a better future—will create organizations that one day look back on the crisis as truly the darkness before the dawn.

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