Where Are the Cracks in Your Foundation?
We live at the top of a hill and rely on a rock retaining wall to manage erosion. Several years ago, after a series of particularly heavy storms, we noticed numerous loose rocks in the wall. We added “wall repair” to the home maintenance list, then became enmeshed in more urgent priorities. Recently, the item finally moved up the list – and of course, that seemingly small repair job is now, well, not small. In hindsight, this feels obvious. Yet, at the time, it seemed fine to wait and see. After all: it was just a few loose rocks.
Grappling with the implications of a systemic crisis for business involves more than a few loose rocks. Typically, challenges often stem from managing growth, delivering quickly and efficiently, or securing the right talent in sufficient quantity. Dealing with the pandemic, we focused on fundamentals like retaining staff, accessing supplies, and engaging customers in ways we hadn’t previously dreamed of.
Nothing reveals the cracks in your foundation more quickly than a crisis.
Things you didn’t see before, or that weren’t significantly impeding performance suddenly become quite visible. And in a crisis, the usual metrics or indicators may not apply. This challenge is amplified when the crisis is both systemic and global – as in the 2020 pandemic. The CEO and the leadership team have to take a closer look to understand what’s happening in the business.
First: identify the cracks.
With most of the workforce working remotely, typically in isolation, it’s been really difficult for CEOs to have clear line of sight about what’s going on. This may obscure the cracks in the foundation or their root causes. Use your people to identify the cracks and make them explicit. Ask them about what’s getting in the way of productivity or their feeling safe. Review customer feedback to highlight common experiences or failures.
Then: understand the nature of the cracks.
Our loose rocks signaled a problem. We saw a few disconnected cracks that were manageable. We didn’t fully understand the nature of the cracks – or the depth and breadth of the problem. Leaders must dive more deeply into the problem: How deep or broad is the impact on operations? How well do I understand the supply chain? How prepared are we now for continued digital or remote work? To what extent are our business processes automated?
Above all: focus on value.
In a crisis, it’s tempting to throw resources at the problem – quickly shore up the cracks and get back to business. When the world shut down in 2020, many CEOs did just that. They focused on the safety of their people and quickly getting them up and running in a remote setting. This was mission critical to save lives and their businesses. Later, of course, leaders cut costs wherever possible. Yet, neither approach was sustainable over what became a much longer-term reality.
CEOs have to think in terms of the value they add for their customers and how they deliver it. A focus on value helps leaders to choose between options to best use resources. What new business or work processes are emerging? What adjustments have managers or staff made to their work habits or environment that have helped to mitigate the disruptors? What can we build upon to add value later? Then invest in the things that you must have – e.g. to keep people safe, comply with new work rules, maintain connections with staff and customers, deliver value, and preserve or grow revenue.
Emerging from crisis, cracks in the foundation become more visible. Before simply moving on, take a hard look at your business so that you can deliver value more effectively and efficiently.