Prior to COVID, 1% of sales were online. All classes, events, new merchandise arrivals were handled in person through floor displays, sign-up sheets, and in-person ticket sales.
In response to COVID-19, the government recommended shutdowns resulting in catastrophic revenue loss. This owner had invested in the help needed to come up with a plan to exit, and to build value in the business until that exit occurred. After the initial shock of the shutdown, this owner and the management team came together and began to plan their workarounds.
The owner chose to pivot. This decision was made quickly with the help of the management team, employees, and the customers. Their ideas were evaluated, weighed, and then executed. Each experiment was constantly weighed, revised, and then tried again.
The owner and the team encountered many challenges. The first of which was the necessity of creating an online store. This required a different point of sales system, with a different accountant, which required onboarding new skills. The entire store inventory had to be entered into the new online store. Next, in an attempt to recover lost revenue from the events and classes, the community needed to become comfortable with the virtual technology. The team from the store had to learn and experiment. Next, they taught their community.
The organizational structure of the store happened to be flat. Each member of the team had a voice in decisions. Each member was cross-trained to perform in multiple functions. Every person was aware of their own strengths and weaknesses as well as the other team members. The culture of the store was strong with clearly defined values (customer centric). The strategic objectives were clear – generate revenue and maintain the tight community.
The store experienced growth on several fronts in 2020: greater geographic reach, more online sales, slight increase in revenue, less inventory “waste”. The efforts of the team to mitigate the impact of COVID was successful.
Bonus: The owner increased the overall value of the store by creating systems and processes for generating revenue through innovation and sound decision-making. This owner took advantage of the greater connectivity in today’s marketplace. Though small, this organization “unlocked” their abilities through greater flexibility, and purposeful, actionable steps that added to organic growth while creating antifragility. The store can continue indefinitely, meeting every demand for change. The very definition of resilience.
As the CEO, you can gear up for change. How? Keep reading.
Anticipate the problems:
- Resistance to change.
- You have to prepare for the fight, flight or freeze reactions.
- Weakness within the organization may sabotage your efforts to respond to crisis.
- Disconnects, blind spots, misalignment with company culture, values, mission and purpose may result in slow, poor decision making.
- Organizational structure may not lend itself to quick sound decision making, pivots in the business model or modifications to logistics, supply chains or talent management.
Prioritize points to consider:
- Agile, flexible organizations are better able to change.
- Leadership awareness leads to greater individual and team productivity.
- From that level of awareness and productivity, the company can establish culture norms and influence organizational behavior which leads to decisive behavior, good communication, greater self-awareness, and a willingness to grow – even in times of crisis.
- Innovation and the readiness for change have a few essential ingredients: diverse perspectives, respect and value for the diversity, norms and processes that can translate the diversity into actionable steps. Racial diversity contributes to a 36% increase in average profit. Gender diversity contributes a 25% greater average profit.
- McKinsey’s January 11th article cite 3 important questions for you and your team to answer:
- Who are you as a company?
- How does your company operate?
- How does your company grow?
Steps you can take:
- Identify the purpose of your organization. This is vital to employee engagement and productivity. (Not kidding!)
- Clearly state and communicate your value proposition. Check it’s alignment to the company values. Reinforce it at every opportunity.
- Make culture your “secret sauce”. Reward behaviors that reflect and reinforce your desired culture.
- Identify and evaluate the fit between your organizational structure and your business strategies. Shift and course correct in response to changes in the marketplace or organizational culture.
- Make fast, informed decisions. Build out a process to facilitate this.
- Put talent optimization on your priority list. Determine your organization’s current and future, talent needs. Design a talent optimization strategy that aligns with your business strategies to achieve the desired results. Identify means to attract and then develop that talent.
- Create ecosystems that welcomes collaboration, strategic partnerships and offers your company opportunities to make an impact in your industry.
- Make data part of your decision making. Utilize data in talent optimization, cost controls, customer journeys and experiences. Create a data friendly culture that welcomes challenges to assumptions and interpretations.
- Facilitate learning throughout the organization. Make learning a part of the culture and ecosystem. Identity barriers to skill building, cross training, as well as design thinking.
95% of all profit is earned by the top 20% of companies. If you aren’t innovating, chances are, your company is dying – regardless of COVID19, death, climate, war, and economic turbulence.
If you want your company to build resilience and survive no matter what, then gear up for the change. It’s coming.
Resources:
- Work The Bugs Out: Practices To Work In, & On, Your Business, by Wendy Dickinson, Publish: TBD. Excerpt: Free Downloadable PDFs to work through.
- “Organizing For the Future: Nine Keys to Becoming a Future-Ready Company”, by Aaron DeSmet, Chris Gagnon, Elizabeth Mygatt, Richard Steele ,January 11, 2021, mckinsey.com.
