I’ve been doing a lot of work in recent weeks helping business clients respond to the ongoing challenges of COVID-19 – especially my Victorian customers who are back in lockdown.
Many businesses are suffering – and suffering more than they need to.
I’m not talking about the unavoidable hurt – loss of customers, loss of revenue or supply chain failures.
I’m talking about businesses that are suffering unnecessarily because they are either:
1) not cutting costs enough; or
2) cutting costs so harshly they are doing damage to their future growth.
Are you leaving money on the table that you could be putting in your pocket?
Three key phases for successful pandemic adaptation
My most successful customers are making the most of the short-term government programs to build their resilience and develop new opportunities.
They seem to intuitively understand the best way to work through the three stages of pandemic adaptation:
- Survival – making the hard decisions about staying alive for the long term – so they have maximum resources to optimise, then transform.
- Optimising – finding ways to keep their core operations working safely and productively in a whole new, distributed operating environment – without ongoing service breakdowns, stress and conflict.
- Transformation – exploring, validating and prototyping new ways and means without creating expensive, business-destroying catastrophes.
But not everybody’s managing that well. Not everybody is clear on what these phases are – and how to work through them step-by-step.
What happens if you don’t “do the work”?
If you don’t work through each stage in sequence you’re at risk – at risk of missing out on either cost reduction or growth opportunities.
You’re at risk for problems like the one’s I’m already seeing.
For example, you might only cut 10% of your costs when 30% is actually achievable. That means you’ve got less resources to use to optimise and pivot.
The faster you know where you are – your phase in the adaptation process – the quicker you will know what to do.
When you work WITH the process, things get a whole lot easier.
You can focus on the needs and objectives of each phase – instead of trying to do everything at once.
Not only that, the questions you have to answer in each phase are simpler and the actions are more straightforward.
Some businesses are just waiting
They’re hanging onto non-core facilities, processes, products and services that could cost them their ability to optimise and transform.
They’re waiting for when we “come out the other side” and “get back to business” – as though they’re dealing with a 6-month interruption and then things will get back to the way they were.
But the world won’t be going back to what was “normal” in 2019. There are things that have changed permanently.
“Hanging on” limits their ability to optimise for today’s new “normal” and their capability to plan ways to transform so they thrive in the future.
Some businesses are cutting themselves off at the knees
Other businesses seem to have “we have to survive!” engraved on their brains.
They’re not just cutting excess costs – they’re cutting out valuable development projects and strategic investments that could enable their transformation.
They’re making their recovery doubly hard.
Some aren’t optimising effectively
Some aren’t recognising or taking time to really optimise today – they’re not making the most of their new, more distributed operations.
They’ve cobbled together a solution that more or less enables them to function. They haven’t done the full job of working out what needs to be adapted, automated, outsourced or dumped.
This makes it harder for everyone involved to deliver. It’s less secure, the job gets harder and it increases stress. Misunderstandings multiply and things fall through unrecognised cracks.
If your business isn’t fully optimised then you don’t have a solid foundation from which to transform.
Some people aren’t looking past optimisation
The world has changed – and it’s not going to change back. It’s all too easy to optimise an old business model and stop.
It’s as risky to get stuck in optimising an old business model as it is to get stuck in survival mode.
Optimising is about optimising your business model – not just your communications technology.
Some are diving too fast into large transformations
Some businesses have leapt straight into transformation. They know they need to “pivot” (how could you not!) and they’re rushing into action with passion – but without a whole lot of homework, expertise or testing.
You don’t need to be first-to-market in the transformation phase – you don’t need to do something big, either. Taking your time and placing multiple small bets is much safer.
Rushing into transformation risks over-committing time, money and goodwill in big projects that don’t allow you to “fail small / fail fast / fail often”. You can’t evolve in response to the rapidly changing environment if all your eggs are in one basket.
When you have a low-overhead business that’s optimised to deliver today, then you can afford to experiment your way to transformation – without agonising about the impact of your development efforts on your daily survival.
Where are you in the pandemic adaptation process?
When you do the work of strategic survival thinking and set some basic objectives, you allow yourself maximum resources for optimising and transforming your operations to thrive.
When you understand the stages of pandemic adaptation, and are really clear on what stage you are in, then it makes your life a whole lot easier.
You can put your attention on what you need to do in that stage.
You’re not bouncing back, forwards and sideways between “how to pivot”, “customer problems”, “staff conflict” and “how do I pay the broadband bill?”.
You’re applying a process that will create a solid foundation to maximise your ability to thrive in the face of whatever comes next (because you’ve survived the pandemic and learned from it).
You have real clarity – and that makes it a whole lot easier for you to define “what is the next right step for us?”
When you’re clear then all your technology and managed service providers are then able to match your business to the right technology platform for the stage you are in. We can help you transition to the next stage with reduced cost, pain and effort.
Doing the work of pandemic adaptation
In coming articles, I’ll pull each of the three phases apart in detail. Here is a summary of each phase and where to focus.
Key elements of the survival phase
The survival phase is about making sure your business will still be there when things restart.
So it’s primarily about cost – but to make effective and strategic cost saving decisions first you need to know what survival will look like for you. It could be as dramatic as hibernation, or it could mean a reduction of 20%, 30% or 50% of your current capacity/revenue.
When you have a clear idea of your overall objective THEN you can make strategic and informed decisions.
Your primary question is to ask: “HOW HARD CAN I CUT AND STILL SURVIVE?”
Once you know the core things that your business won’t survive without THEN you can look at what to cut in a meaningful way.
Key elements of the optimisation phase
The key focus of the optimisation phase is productivity – how can your business be most productive in this new world of work?
What are your core activities? What can be automated? What could you outsource? What new tools do you need to collaborate effectively even if you’re working remotely?
Could a chat function on your website replace a receptionist? Would an investment in video-conferencing improve your customer experience?
Take some time to ensure your security too – there’s more than one sort of virus out there that could hurt your operations.
Key elements of the transformation phase
Transformation is planning and evolving your business as society and industry shifts around you. This has been happening at a pretty high level over the last decade – now COVID-19 has doubled down on it.
There are new understandings and new expectations developing. In this transformed environment there will be a whole lot less “going to work”, along with much less discussion of “work/life balance”. The notion of “working from home” isn’t exceptional – we’re just “working” and “living”.
In the face of this new and rapidly changing environment, the best way to do transformation is in small, experimental bites – “fail small / fail fast / fail often”.
Fortunately, transformation isn’t something that you have to make up “from scratch” any more. You can access and apply tools such as Blue Ocean Strategy and Lean Thinking to help you work out where you can transform your business.
The right technology infrastructure can support and accelerate your transformation – if you’re informed and strategic. This is a place to get expert advice on the range of what’s possible to achieve your objectives.
Where are you in the adaptation process?
Are you still working on the survival phase? Are you trying to work out what to cut and what to keep? Are you feeling pressured to get on and “do something – ANYTHING”? Step back and define what your objectives are before you cut too deep. We can help you examine your overall costs and find savings you may not know are possible.
Are you working on the optimising phase – putting together the tools and processes that will enable you to serve your customers well in these challenging times? Are glitches getting in the way of doing good business and keeping sound relationships? We can help you find ways to streamline and improve your newly distributed business process.
Are you entering the transformation phase – looking at new products, markets, services? Take advantage of our execution experience, so that you minimise the risks of the wrong transformation with the wrong tools.
Do you need help to maximise your savings?
Expert advice that looks at your whole-of-business costs could make a big difference to how quickly you recover post-pandemic. Contact us today to find out how we can help you find business success through the three phases of the pandemic adaptation process.