• Cairo Walker

Face the Fear and Accelerate Past the Rate of Change


Photo by david henrichs on Unsplash


The COVID-19 Pandemic sped-up trends that were already happening  - reduced office space, digital acceleration, and disrupted the global supply chain. These all forced organisations to find alternate ways of doing business.


Brands are unable to keep up with the rate of change, particularly when it comes to technology. It's clear that most business leaders, while aware that change is increasing at an exponential rate, are unable to get ahead of it. At best, brands react, instead of getting ahead of the inevitable changes.


Faced with so much change, we have seen organisations adopt a 'wait and see' stance. Rather than being proactive brands are standing by to see the direction handed out by government or that taken by competitors.


For many, the intention is to stay with or, revert to the status quo. Off the back of research with organisational leaders and staff, I've put together the following key trends and challenges and how organisations are meeting these:

  1. Reduction of the Office Footprint

  2. Employees Demand Businesses Step Up

  3. Lack of Digital Literacy At All Levels

  4. Disruption to Global Supply Chain

  5. Flow-on Effects from Other Businesses

  6. New Technology - and More on the Horizon



1. Reduction of the Office Footprint


Long before the COVID Pandemic drove sudden remote working, Activity Based Working tore down internal office walls, removed individual ownership over desks and set the scene for a blended working environment between home and office. Employees worked from home a day a week, and the physical footprint reduced.


The greatest work from home experiment continues. We are at the nexus between a return to the status quo and moving to a new way of working. Employees who agitated for a return to the office now find the experience isn't living up to their ideal.


Business leaders are not only asking what they will do with their real estate; they are questioning the implications for their personal investment portfolios.


It’s unclear what will happen over time. Most studies advise that although cities are here to stay we can expect a swing away from urbanisation as people move to regional areas. Certainly ‘the neighbourhood’ will experience an upswing, including the businesses that will support people now spending more time locally.


ABCW article: How coronavirus could forever change the look and feel of Australia's cities and suburbs. By Gian De Poloni


Lesson, Insights, Practices (from the Group)


Take the savings from reduced real estate footprint and funnel into employee training or personal development.


"Employees will value employers and leadership that moves beyond 'either/ or' to a more nuanced way of doing things."

Take care to ensure that real estate savings are not being taken up by employees footing the cost of work full time in their own home office. There are expenses related to hardware set-up, internet and phone costs and also hidden secondary costs associated with physical and mental well-being.


Where practical supporting staff to use local co-working facilities can off-set the negative effects of time spent at home and also create a new kind of blended working environment.



2. Employees Demand Businesses Step Up


Just as employers are adopting a 'wait and see' approach, so too are employees. The best and brightest talent view the current times as an opportunity for organisations to sheer off the 'rusted-on, squeaky wheels' and find new, innovative approaches.


Staff talk in terms of the need for the organisation to undergo 'short term pain for long term gain'.


Savvy employees are poised to vote with their feet - failing to embrace new ways of working will result in a loss of key talent for companies.


Companies have a few short months to demonstrate their ability to innovate. Employees are all too aware that in those organisations that did not embrace working practices, the status quo will return. While employees are prepared to accept these returns, they are not willing to continue with out-dated business models and customer service offerings.


Lesson, Insights, Practices (from the Group)


Armed with BYOD such as tablets and phones, younger workers are asking how they can engage through these. Recognising the low total cost of ownership, organisations are making low-cost, easy transactions available through these devices.


Younger workers are the keenest to return to the office post-Lockdown. For those working in any knowledge economy, the approach around returning to the office has mostly been a blended one. Some organisations left the decision on whether to return to work with employees; others made the directive.


High-value employees understand that the Pandemic has brought a unique opportunity for businesses to take bold steps and new directions. Rather than waiting, savvy brands are making moves to reshape the supply chain, business model and customer offering.

3. Lack of Digital Literacy At All Levels


The proliferation of digital is confusing. Businesses know that their way of working and their technologies are out-dated. For many, the thought of updating is too much of a burden to take on.


When it comes to digital advancement, people don't know where to go for help. They don't understand how much to budget or, which questions to ask to ensure a good outcome.

Digital was the answer to business continuity in the times of COVID-19. After hurried technology implementations, organisations are now aware of the need to address governance issues ASAP; however, few are moving to do so.


Physical home office environments are an ongoing challenge. Staff don't have the necessary hardware and software. There is fatigue with endless Zoom calls.


Organisations are understandably concerned over employee well-being.

When physically in the office digital literacy is obscured; people stick to apps they're comfortable with and fill in with face-to-face interaction for the rest. 


As if this wasn't enough, there is more tech change on the horizon. Companies are already struggling to align technology to the business, and more change in the form of AI is coming.


Lesson, Insights, Practices (from the Group)


Retrofit governance to any systems rolled out in response to sudden remote working. VPNs, new desktops, M.S. Teams, Zoom and more - technology was implemented to provide for working practices not yet in place. Establishing governance will ensure the long-term viability of systems and fix up any broken rules and workarounds. This kind of good management will also ensure supporting practices work are in place for all involved - the supporting teams, stakeholders and the end-users.


Similarly, the rapid rollout of new tech has left many employees questioning their use of the latest toolset; specifically if they are getting the most out of these new ways of working. Introducing formal training will help overcome employee's feeling they're left behind.


When physically in the office, digital literacy is obscured; people stick to apps they're comfortable with and fill in with face-to-face interaction for the rest. The challenge now is to help people who are not digitally-literate connect. Assisting with simple things such as turning on the camera or understanding how to behave in online chat can be deal makers.


Explicit and targeted instruction will off-set some of the additional pressures incurred now that 'learning by osmosis' or serendipity has is mostly gone. Formal training also gives staff a common language around systems and an 'object' around which they can have a shared experience.


The move to sudden remote working forced employees to tackle more new tech than ever before. Many employees have surprised themselves and, quickly picked up the new technology. Employers should build on this confidence.



4. Disruption to Global Supply Chain


The COVID-19 pandemic has accelerated shifts in the macro supply chain that were already happening.


Five Eyes material looking at dependence on China confirms the concerns of Australian citizens. When it comes to supply out of China, Australia is broadly exposed but specifically around terms of trade.


Due to expense, several companies had already begun the migration to move supply beyond China to Thailand and Vietnam and South-East Asia.


For all these reasons, local companies are reconfiguring supply. Some are moving up the chain to become primary producers and remove the need for international supply altogether.


The Pandemic disrupted and changed global supply chains. China recognising the control it had over the ANZ market increased costs pre-COVID. In response, savvy operators looked elsewhere for supply. As such, they were less exposed.


Businesses are re-examining the total cost of business and looking for new ways of doing things.


Lesson, Insights, Practices (from the Group)


Businesses are prioritising their ability to 'keep the lights on'; to pay employees and continue trading. For many, this has resulted in the now infamous, over-used 'pivot,' whereby brands are finding new ways of working to survive.


"When humans have their backs against the wall, they get innovative; models disrupt - check out what happened out the back of the GFC."

We have seen some fantastic new business models emerge. Top restaurants have done more than deliver food to the homes of patrons, some have created home-style cooking programs. Ingredients are packaged in elegant boxes and arrive prepped and ready for cooking. The chef comes to the kitchen via Instagram to give instruction and support through the cook to the plating. The latter, by the way, occurs on the restaurant crockery which turned up in the box along with cutlery, wine glasses and a glass of wine. It's less of a pivot and more of an adjustment. Nevertheless, it's innovative, effective and spot-on for what consumers wanted (within the constraints at the time).


The majority of businesses are revolving the pivot and retiring these new models now that things are opening up. Just as employees now 'expect' to work from home more, consumers will now also want the option to enjoy a meal from their favourite top restaurant at home.


5. Flow-on Effects from Other Businesses


Unsurprisingly, capital-intensive businesses that have hard-copy at their core have suffered hardest during the Pandemic. Before COVID, with so much free content available online, hard-copy content was more of a luxury experience. Before the Pandemic, we enjoyed newspapers and magazines at the beach or on a plane. Now, these experiences have disappeared, and print sales have gone with them.


The majority of 'print' businesses that had diversified into online products; are also taking the hit on their digital products. Retailers who have been hit hard with declining sales have cut back advertising across the board.


As if this wasn't enough, many print businesses also produce advertising (specials circulars) and product catalogues. Looking for further savings, most retailers have stopped making catalogues.


Lesson, Insights, Practices (from the Group)


Market adjustments are predictable. Early last year leading financial advisors alerted clients to move their investments to cash in anticipation of an upcoming shift in the market.

The U.S. and U.K. turned immediately to the GFC for cues on how the market would behave. They looked to clues on what to do in response to the COVID-19 Pandemic. The GFC didn't hit Australia and New Zealand as hard as it did the rest of the world. ANZ has mostly failed to recognise the transferable trends and learnings from the GFC but should do so.


Follow overseas companies and look to the GFC for clues about what will happen and how people will behave in your industry, sector and location.


Many businesses have taken heed of recent events. Vowing never to be caught out again, companies have undertaken on scenario planning to ensure readiness for significant events. Scenario planning, like change management, should not be a project-related activity. Weaving both into the organisational culture, DNA and working practices is the way to go.



6. New Tech - and More on the Horizon


For companies, the success of the rapid rollout has been a double-edged sword. On the one hand, there is proof that the organisation can quickly stand-up environments. Stakeholders, employees and customers expect more of the same. In this environment, broken rules and workarounds abound. Governance now needs to be established.

For the most part, the COVID-19 Pandemic sped up the inevitable; forcing industries to make the move to digital, despite any previous reluctance.


Although digital strategies have been dusted off and are now in play, companies struggle to get a real return on their technology investment. Software implementations still run longer than six months; often into the years. By the time the tech is in place, the world has moved on; and the company finds itself behind once more.


Companies are already struggling to align technology to the business, and more change in the form of A.I. is coming. The implications of choice are overwhelming.


Local businesses that have been experimenting with robotic process automation have rolled back their endeavours. This kind of automation is attractive, with maximum potential to benefit the company. Whilst it does seem tantalisingly close, it is still relatively low in maturity.


Whilst the C-suite may want automation; most are still unwilling to look at the impact on the redundancies in people's roles. On the one hand, staff freezes are in place and on the other, process automation flows on to remove people's roles. A rare few have looked automation and the impact on staff and asked the question, "how do we then use our people to enhance our business?"


Lesson, Insights, Practices (from the Group)


Savvy businesses are preparing for the next wave of information technology. In all sectors, vendors are signalling the changes on the horizon. Chatbots, A.I., machine learning are all hot topics now. Look to what vendors and leading consultants are heralding as the next wave of tech.


Readiness (retraining) programmes to help staff meet changing market needs are in place with most large companies. Some models elevate humans beyond menial tasks to focus on relationship building and other nuanced tasks. In this model, staff take on higher-order roles, rather than being made redundant.


Knowledge management may have been fifteen years too early. Humans and A.I. together are much better than either alone. Forward-thinking organisations are putting Knowledge Managers back into play to curate, categorise and manage content and to help the A.I. get the online page better.


So many categories of vendor overlap - the critical part is around what you integrate with to make the big solution. It is helpful to look to third-party solutions to address gaps in software; to join various systems together and to ensure that you are addressing your specific need, rather than a general one identified by the vendor.


Figuring out how to experiment at speed and low cost is imperative. Rather than agile, it's more about finding the best ways to fail fast and cheaply. In one company I.T. spun up thousands of small, low-budget projects each year. I.T. it 1,000 little fires and waited to see which ones people approached to warm their hands. I.T. then poured gasoline (resources) on those fires and turned them into full-scale business initiatives.


Businesses that provide a physical product are taking heed of the work practices employed by industry giants such as Amazon and their bots. Planning around the skills needed to meet new consumer demands; figuring out where these resources are and who they might are is in-flight.


It's not just the technology that's not quite there - it's also the people. Many staff want to continue operating in the same ways as before. There's an easy comfort in undertaking manual data entry, and other straight-forward takes for many people the fear of digital remains. The answer is in finding out from people what they are most afraid of. For those that can get to the heart of this, the most resistant people have then become the most fierce advocates.


In some organisations, programs that look five years ahead seek to train up today's workforce for tomorrow's business. Interested frontline operators ing retrained today to develop and work alongside tomorrow's A.I.


"We spent a lot of time using people for their bodies - let's use them for their brains."



Summary


Whilst the COVID-19 Pandemic has undeniably impacted business operations across the board; it has only sped up what was already happening. Reduction in office footprint, the ongoing disruptions to the business, increasing speed of technology innovations and the lagging digital literacy of employees and organisations while not new, continue to be acutely felt.


The lessons from other brands outlined above do provide ideas around how to face the challenge of doing business in an everchanging world. Even so, most organisations will not have the requisite skills in-house for successful delivery and, will need to buy these skills in as some consultancy engagement.