Part 2: Pandemic Perspective: Leadership Decision Making in Uncharted Territory
There is no playbook for this pandemic. Leadership teams in 2020 are navigating uncharted territory to rapidly respond to this crisis with a mandate of keeping employees and customers safe, managing customer demand and supply chains and fast tracking digital innovation to reflect consumers’ changing needs.
“Never before have we responded so comprehensively and so quickly to an issue that’s happened.” This new environment has also encouraged rapid decision making, “… if it doesn’t work, fail fast and move on.”
As CMO’s, CCO’s and CXO’s continue to respond to the COVID-19 crisis, our study captures their priorities, decision making frameworks and strategies at this time. In this, the second of a 3-part series, we examine how this new operating environment is requiring a rapid problem-solving and decision-making leadership style.
“We have had to make decisions in a matter of hours on thousands of peoples’ lives.” aptly summarises the decision-making environment.
Crisis Cost Cutting
Many leaders in the study now find themselves operating in a marketplace with one or more of these conditions: decreasing demand, falling revenues, static costs and a lack of future certainty. Leaders overwhelmingly stated that organisations are seeking to cut costs and are now in the process of making difficult cost reduction decisions.
“We’ve got workstations for 95% of our staff, so we could save a lot of money by only having 60% of people in the workplace at any given time.”
Businesses are looking closely at how to make their fixed costs variable; maintaining fully staffed corporate offices comes at a high price, as does corporate travel. A number had placed restrictions on hiring new staff. It is forecast by leaders that digital interactions will replace much business travel even after restrictions are lifted, helping them to curtail the associated financial costs and positively impact productivity.
Retailers have the added burden of managing inventory, some struggling to maintain pre-crisis inventory volumes, others experiencing “… huge bottlenecks in their supply chains” with the seasonal crossover. Then there’s the businesses that remain closed due to government regulations preventing large gatherings of people; for these businesses the cost of the shutdown might well have a long term, detrimental impact.
Decision-Making Frameworks
Our research shows that leaders have quickly shifted from a strategic focus to responding tactically; fast-forwarding decision making in areas such as cost control, risk mitigation, revenue and demand, operational logistics and innovation.
“Conversations on the same topic could change comfortably five times in a week because the trading environments we’re operating in are very different.”
Of interest was the diverse approaches to decision making. A number of organisations had crisis management teams already in place and one aged care study participant coupled this with a clinical governance committee of ten. Risk mitigation featured in my conversations with leaders, as did mapping scenarios and business continuality planning – with communication trees and plans in preparation for worst case scenarios.
“The challenge we’ve faced is adjusting our plans in a very agile fashion to address those challenges and to meet the needs of our customers.”
Customer-Centric Decision Making
Twenty five percent of the cohort described their culture core as ‘customer-centric’. One retail study participant described the agreement of her ELT that “… no decision would be taken that was incongruent with our purpose.” She believed that this critical decision empowered teams across the business with independent decision making powers in a far more agile way.
With often hourly updates of information from various sources, leaders were experiencing “… information over-saturation and decision fatigue.” Most important for our customer-centric leaders was making customer data highly visible for their executive leaders to help put customers at the centre of their thinking.
“The number of customers in hardship. The number of customer who were contacting us. The number of customers who were calling us and their questions – this really hit home to the executive team.”
Rapid Innovation
Within the space of 8 weeks and harnessing their remote workforce, 50% of organisations in the study had fast-tracked new customer solutions. A number of the innovations were born out of business necessity, others capitalised on new market opportunities, and other initiatives were fast tracked from future planning for immediate activation.
“Customers want consistency around safety and they want brands to be able to give them new ways to shop safely, whether that be through store or online.”
Examples include: contactless pickup so customers didn’t have to leave their motor vehicle, vulnerable customer home delivery, a co-partnered solution with Amazon and Salesforce for a health and safety mobile application, digital training, e-learning programs, online seminars and virtual prototyping of new web services.
Most of the leaders in the study agreed that the consequences of the rapid decision making needed to manage the crisis was not sustainable, “… how much change can your people absorb at once?” Other leaders in the study were energised “… hoping that this will continue into the future so that we can keep up the pace of our transformation and not go back to the slower pace that we had before.”
“I find myself more tired at the end of the day, and I think some of that is also the stress of being in crisis.”
More than any other emotive term, leaders used the word ‘fatigued’ to explain how they were feeling. Fatigue has been brought about through physically and emotionally caring for their teams, their customers and the business. This is coupled with having to be ‘always on’; dealing with the systemic, crisis-led changes affecting how people live, work and socialise – and it is taking a personal toll.
Find PART 1: Keeping employees and customers physically and emotionally safe: Research Study: Marketing & CX Leadership in the Crisis Economy
About this Research Study
Leadership in the Crisis Economy: Pulse 1/2020
By Alex Allwood – Director, Customer Strategy and Experience
David Thompson – Research Associate
All Work Together Pty Ltd
June 2020
- Leadership in the Crisis Economy, Pulse 1/2020 is based on a qualitative study of 12 Australian executive leaders across 12 industries.
- All Work Together conducted the research study in May/June 2020. Data from the research was synthesised using cluster analysis to deliver findings and insights.
About All Work Together
All Work Together is a business consultancy specialising in customer experience (CX) research, strategy and design. Our method is recognised for connecting customer and culture; helping organisations put their customers’ needs at the centre of their thinking, problem solving and decision making. Helping leaders connect, unite and align to empower customer-centric growth. https://allworktogether.com.au/
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