Never Let a Good Crisis Go to Waste

Although the impact of the COVID pandemic has varied by region, no person or company has been immune to this global health crisis. Over the last few months, business headlines have been dominated by stories of shutdowns, layoffs, and vast uncertainty.

Few and far between have been stories of success, adaptation, and revitalization. Often, the fallacy surrounding many of these stories is that they are attributable to luck or the intervention of outside forces such as buyouts or government programs. While that may be true to an extent, stories of leaders and companies who have truly embraced this crisis to incite transformation are rare.

Enter, Jim.

Jim (not his real name) is the CEO of a family-owned-and-operated Alberta-based organization with about a dozen stores and profit centres across the province. Our team has supported Jim and his company throughout this crisis.

Below are two quotes that we have heard over the last few months.

“April has been one of the toughest months we have ever had. We had to make significant layoffs. Our market has crashed. Our sales are a fraction of what they were in April of last year. I’m not sure how we’re going to make it through this.”

“June was one of the best months in recent memory. We are having trouble keeping enough inventory on site to keep up with the demand. It would be impossible to pick an employee of the month, everyone has stepped up. The future looks bright.”

Keep in mind these quotes were the from the same leader, leading the same company, only two months apart.

In the case of Jim and his company, this dramatic turnaround in a short period of time was no accident. In fact, you could argue it was almost entirely attributable to the intentionality of his executive team to create urgent, value-driven action in a time of crisis. So, what happened to drive this urgent transformation?

Before we look at his company and the actions his team took, let’s take a quick look at Jim. Never has the challenge of leadership been more on display than during this crisis. Those leaders who have demonstrated indecisiveness, pessimism, and arrogance are likely now “looking for new opportunities”.

In Jim’s case, his ability to lead his team and his organization through this crisis was an indication of the strength of his leadership, primarily in three key areas: optimism, courage, and humility. In the context of this pandemic, let’s examine each of these attributes.

Optimism doesn’t make success happen, but it allows it to happen. It is the unrelenting belief that, despite stacked odds, success is inevitable. Did Jim have doubts that they would emerge from this crisis? Of course. Jim, like the rest of us, is human. However, in his role as a leader, his demonstration of optimism became infectious throughout the organization. Once everyone believed they were going to successfully emerge, success became…you guessed it…inevitable.

It takes courage to follow your convictions. On the surface, courage is often viewed as the ability to make tough decisions. What often gets forgotten in this definition is a leader’s ability to persevere once a decision has been made. Defining moments will arise when a leader’s values are in conflict with a decision. It’s at these times where courage of conviction becomes invaluable. In the case of Jim’s organization, survival was a direct result of necessary layoffs as a measure to cut cost and enhance efficiency. On paper, this is a financially-easy decision. In Jim’s reality, as a leader of a family-owned-and-operated company, he viewed each employee as a member of his family. This made each decision regarding layoffs painstaking, despite its necessity.

Humility is often mistaken for modesty. In the context of leadership, this is a misnomer. Instead, it is an understanding that one person cannot do the job alone, and it is only through the galvanized collaboration of those around them that great results can be achieved. Jim realized that the complexity required to lead his company through this crisis was too great to handle on his own. In recognition of this, he became the catalyst for his executive team and regional leaders to empower them to create action and results with urgency.

 

As we learned from GI Joe, “knowing is half the battle”. Jim knew that he had to embrace these key attributes of a resilient leader. He knew that he must work tirelessly to instill urgency and optimism throughout his organization.

If, in this case, knowing is half the battle, the other half is…the actual battle. So, what did Jim and his team do to give his company a leg up on the battlefield? Again, let’s take a look at three key areas of activity, categorized here as People, Product, and Plan.

As mentioned earlier, Jim’s company, like many others across the country, had to make tough decisions regarding layoffs. In an initiative co-led with his HR Director, Jim had ongoing conversations with each of his regional leaders about how to best cut costs and enhance efficiency. The obvious path forward was to make layoffs at each site. Because the process and subsequent conversations were handled with care and respect, each employee graciously accepted the layoff with an understanding of the company’s position. Although sales volumes have started to return, the company is clear that not all positions will be brought back. Instead, each leader now has a renewed sense of how to run an operation with enhanced efficiency.

Jim’s company is a retailer, and therefore has little-to-no influence on the various manufacturers that produce their products. These manufacturers, like all companies, were heavily impacted by the pandemic. Supply chains were disrupted, sales decreased, and production stalled. As a result, Jim’s company for the first time ever had an inconsistent supply of product. Now that demand is returning, they are struggling to match the right product to the right buyer. In response, the entire organization is transforming their buy/sell experience. In the past few months, the organization has made significant strides to deliver a seamless, yet highly flexible, buying experience to their customer. This has been a key driver of returning sales volumes and enhanced customer experience.

There is an adage that says, “results without a plan are an accident”. Jim and his executive team, through their strategic planning process, took this a step further. They decided that the pursuit of results through planning was the first of two steps. The second step was to regularly hold each leader accountable to their intended results. By making this an organizational practice, the mentality of each leader began to shift as it relates to decision making. Now each decision, whether ordering new inventory, offering a discount, or buying a new stapler, is evaluated on a cost-benefit-goal basis.

On a call last week, Jim admitted that they “still weren’t out of the woods yet” but the indications are that their actions and changed mentality will translate to sustainable success.

 

We have all heard variations of the phrase “I wonder when things will get back to normal”. With each passing day, it becomes more difficult to know when “normal” will return.

Jim has taken a different approach. A courageous approach. He has dismissed the entire premise of that phrase. Instead, Jim and his team are creating their own new normal. While others are caught in uncertainty and speculation, Jim’s company used this pandemic crisis as an opportunity to completely transform their operations, culture, and mentality. Now, they are a pioneer at the forefront of their industry.

Published by Jordan Orr
Consultant