Businesses that are surviving are those that were either prepared or those that pivoted quickly, innovated, and found ways to keep delivering value for their customers.
The business world has been significantly disrupted by the pandemic. During situations of macro disruption, most people look for ways to first survive and eventually emerge from the circumstances stronger and better. As they do this, most leaders attempt to re-create past success—to go back to what life and business were like pre-disruption.
Few people look forward with excitement to the unpredictable, unknown future while living through the dissonance caused by ongoing disruptions. Yet because of what we have collectively experienced, there is no going back to the old state of things. Business environments are changing constantly. True business recovery is forward moving, embracing today’s reality and finding ways to thrive within it. The best measure of successful negotiation of disruption is how strongly you recover.
There are plenty of approaches to business recovery, but the key to success is avoiding the obstacles that will impede or even stop recovery altogether. Ensure your company isn’t sidelined by these three recovery killers.
BAD STRATEGY
Strategy is the foundation of healthy business recovery. Good strategy is based on identifying and focusing on a contextual problem you can solve for customers using the resources you already have. Without the focus to visualize and diagnose the opportunity, you’ll find that the doors of opportunity close rather quickly. Your customers are dealing with the same pressures you are dealing with, and these pressures have resulted in specific customer needs. Those are the opportunities your strategy should be reflecting.
Whenever there is disruption, even naturally occurring ones such as hurricanes, people who seem to survive with the least damage are those who were prepared in advance or those who acted quickly. The same is true with the pandemic. Businesses that are surviving are those that were either prepared or those that pivoted quickly, innovated, and found ways to keep delivering value for their customers. In some cases, they even found a new customer base.
A strategy that will help you thrive during a pandemic must have three components:
- It must be deeply founded in the purpose of the organization. During times of disruption, you can change how you deliver value and who you deliver value to, but not why you exist—unless you want to be a new company.
- The second component is that the strategy must embrace agility. You are experiencing a VUCA (volatility, uncertainty, complexity, and ambiguity) situation, and any strategy that will be successfully executed must embrace dynamism and quick learning.
- The third component is that it must be simple and people-driven. It should not be abstract, complicated, or dependent on a number of factors all falling into place. And it should not be based on the desires of the company but instead on the desires of your customers.
LACK OF PATHWAY TO VALUE
Value creation is a scientific, structured process. If you don’t have a pathway, it’s easier to get lost. Good ideas do not always result in profit, especially when they are neither clearly defined nor executed in the right order. In order to recover faster, you should use a proven six-stage process to discover, create, validate and sell your solution.
- Stage 1 is Identify: Get clear about the value your company should be offering right now. Consider the issues that your customers are facing and come up with the right ideas that are contextual for this market.
- Stage 2 is Define: Outline the value your solution will create. It starts with the definition of the customer problem. You must spend time with customers, so they can tell you what is most important to them right now. Remember your customers are changing every day because of the fluctuating market conditions, so what you knew about your customers months ago may no longer be valid. You must continually engage your customers to understand their needs, wants and desires.
- Stage 3 is Develop: Here you will create the solution, product or service you have decided upon. After you have worked with your customers to define value, use their feedback to develop a situation. Customers love it when you ask for input on a service or product that is being developed. Spend the time asking questions with empathy and let them tell you what they believe is the right solution. Then you’ll have what you need to create a solution that addresses that specific gap.
- Stage 4 is Validate: Test the solution with customers during the fourth stage. You need to validate your solution with not only those customers who provided feedback during development, but also a few more customers who are similar. This provides you with much-needed data, confidence, and early-market testimonials that will allow you to be successful.
- Stage 5 is Deploy: After customers have validated your solution, you can take the momentum created by their enthusiasm and use it as you begin to deploy it to your entire target customer base.
- Stage 6 is Scale: If you execute each step correctly, the success that leads from customer validation to deploying will allow you to gain traction and eventually scale, taking your solution out to a wider audience, and possibly in a way you hadn’t yet considered.
MISMANAGEMENT OF PEOPLE RESOURCES
During stressful economic conditions, businesses typically react in one of two ways: they look inward for help or look outward for help. The right solution is to look at both. Inward should account for 70% or more of your recovery strategy. The 70% is composed of focusing on the resources you already have and coming up with ways to better utilize those resources to aid in recovery. Your employees are best positioned to help you with this examination.
Changing environments require leaders to be more flexible and better at engaging others to find stability in the midst of the business turbulence. Leaders mismanage people resources when they believe they alone know the answers and have the solutions. It is your employees who will make a strong and fast recovery possible. You must seek help and genuinely engage your largest existing intellectual, operational, and emotional resource: your people. Inevitably if employees are not confident about recovery, then the company won’t recover.
You will not be able to get the best out of your employees if you believe they are expenses instead of solution generators. Focus less on the overhead and instead focus on what your people bring to the company in the form of ideas, innovation, customer engagement, positive vibes, and overall morale.
Companies that engage their employees to seek solutions recover faster and are in a much better position than their competition because their employees go beyond the call of duty to build a better future, not only for themselves but also for the company.
The Better Business Bureau Northwest + Pacific is one example. Early in the pandemic, the executive team decided they did not want to lay anyone off. Instead, they focused the employees on increased customer engagement, internal emotional support, and innovation. Here is what they did: They invested in innovation projects that would provide solutions for their customers and involved as many employees as possible in the process. They had regular meetings and kept their teams energized, so that even with people working remotely, they were able to keep solutions development and delivery moving forward. Both their employees and customers are fully engaged in the business solutions they have been providing. And today they cannot hire fast enough.
To recover stronger during VUCA times like the one we are experiencing, you must do the deep work as an organization to update your strategy and review it regularly so you know you are working on the right opportunity. It is your job as a leader to share with your team the right information so they can maximize the value that your customers are looking for right now. You must have a structured approach to value creation; without it you are promoting a Wild West mindset and you will lose opportunities and waste the very limited resources you have. Make your customers and your employees the central focus of value creation; without them, you have no business.
Originally published October 12, 2020, with Fast Company.
