We continue with our ‘Words of the Day After’ series with an emphasis on: Rethinking Business
Being a leader requires the use of discernment and outlook, as well as the ability to question the business model and to assemble without discouragement the strengths available in order to adjust and keep on course in the long-term, regardless of the disturbances that arise. Thus, the Covid-19 crisis is leading us to think positively about companies and the profound meaning of their action in society after the pandemic.
To develop or reinforce their resilient and responsible character, tomorrow’s companies must reflect on their rationale more than ever and learn to reform some of their operating modes: rethink their customer relations, governance model, the role and position of employees and create new forms of cooperation with partners and suppliers.
Customer-centric: trust, loyalty, digitalisation
One of the lessons of the crisis is that businesses that resist best are those that can adjust rapidly to customer changes.
Managers must revisit their customer relations by setting up a better-structured system to listen to and anticipate needs, by multiplying multi-channel contacts, to adapt the offers and carry out a customer portfolio review through a more targeted value analysis. To better anticipate consumer behaviour, a major specialised retailer has set up a system to analyse social media thanks to artificial intelligence to adapt its products, services, and communication with customers.
Putting the customer back at the centre of operations over the entire chain is a priority. During the crisis, one services company reviewed its call centres by introducing the video channel upstream more systematically, thus improving the conditions of trust and simplifying request order processes downstream.
The thorough renewal of a more personalised and touchless customer experience involves an acceleration of digital technologies by offering smoother experiences and reducing the customer’s effort at digital points of contact. Recent surveys by Capgemini show that the pandemic has been a catalyst for the adoption of touchless interfaces – 77% of consumers intend to increase their use of these technologies – and that the rate of use of online sales will increase by 30% by the end of 2020.
An ability to make quick decisions to adapt the business model
The matter of governance and decision-making is crucial for companies faced with unprecedented situations.
Managers have to adapt their stance and introduce faster decision-making processes to adjust to disruptions, make quick decisions and stay on course. This requires aligning one’s management team in advance to the company’s values (fairness, solidarity, trust, etc.) and mission. Deliberations are then focused first on means and impact analysis with a short-loop decision-making process.
A retail company has implemented a two-level system of systematic feedback that aims to allow adjustments to be made, if necessary:
- Feedback from the management team regarding choices made via shorter and more targeted processes, on subjects such as employee involvement, sales dynamics, financial impacts, etc.;
- Feedback from the field via “sensors” making it possible to relay the perception and to rapidly assess the performance efficiency of the decision (implementation methods, appropriation).
Management dashboards must also move from a retrospective approach, based on predefined information or historical analyses, to a resolutely forward-looking approach, based on detecting weaknesses, trends, sensitivity, and scenario analysis. Work must be carried out on analysing information that may at first glance be irrational, to detect any potential for crises early on. This involves more open questioning on variables that are not usually considered, or converging ideas and hunches, real-time management cockpits. Data must be a facilitator: link and trace existing information, enrich and exploit it thanks to increasingly mature digital technologies.
The manager’s decision-making requires not only the use of rational criteria but also intuition and creative flair to innovate, adapt the business model at the right time and be increasingly competitive. Anticipate without rushing: success is being one step ahead.
Lastly, decisions are not made alone. The task of managers is to combine all the company’s assets to stimulate collective intelligence: human capital must, therefore, be put back at the centre of the company.
Position employees in a different role in tomorrow’s company
To make the most of this human capital and stimulate emulation and lasting collective intelligence, a significant development is required in employees’ positioning. Employees must no longer consider themselves as passive players in their company, nor be considered purely as a labour resource.
Companies must motivate and give their driving forces the means to share and achieve their ideas and innovation opportunities to develop their company.
The first key factor of the success of this participatory innovation approach is to have support at the highest level and managers who are convinced and who lead this approach.
The second key factor for the success and sustainability of this new operating model is to have a decision-making process and participatory digital platform which secure the achievement of the innovations given priority and which communicate the results achieved. This engages employees in the development of their company and moves them towards a new positioning as a driving force for innovations.
Another major change brought about by the crisis we have endured for several months is to working methods that we thought were unchangeable. The working methods imposed by the pandemic have forced employees and managers to quickly adjust, to use new tools, new methods of collaboration, socialisation, and management to offset the lack of proximity and social relations. In the post-COVID world, it is impossible to return to the old model as if nothing had changed. New paradigms of skilfully balanced work are emerging.
Companies must guarantee their employees a balance between:
- face-to-face situations to re-establish solid social links between colleagues, reinforce the feeling of belonging to a community of interest joined together in adversity
- … And home working, while ensuring a clear division between personal and professional life.
In order to make this transition successful, companies must, more than before, rally their employees around strong values, those that prevailed before Covid-19 and undoubtedly add others resulting from this new participatory innovation.
The crisis has also shown multiple vulnerabilities in companies chain of value (disruptions inflows, extended lead times, or dependence on a supplier). Companies must rely on a new ecosystem made up of partners and suppliers. This will make it possible to share the burden of innovation, the success of a product, and also the associated risks throughout the value and supply chains.
This new portfolio of partners must be diversified and relocated to make it possible to respond to new industrial and logistics challenges: flexibility and resilience. Companies will achieve this new balance between partners by responding to the combined optimisation of their cost structure and their degree of resilience. This includes a systematic analysis of points of vulnerability and dependence in relation to a single supplier or a single region. For example, we may have to entrust partners in Europe with manufacturing processes that did not appear to be strategic, but which now clearly are by adding resilience to the prism of economic performance, particularly in the event of transport limitations.
The future ecosystem of companies partners will probably depend on a more local network of SMEs. This reconfiguration will allow these SMEs to become champions or specialists, give them access to market segments with better margins or higher volumes, thus encouraging their development and their innovation capacities at the local level.
The implementation of this new ecosystem of partners can also be supported by the digital transformation and more agile approaches, facilitating collaboration between people in the company and its partners, to manoeuvre quickly. It also involves supporting the development and training of these new partners by sector and also by implementing innovative and simplified funding mechanisms.
Companies have a very wide field of opportunities to remodel their customer relations, their governance, to change the way they interact with their employees and their external ecosystem. However, they have to be prepared to discard some old certainties and adopt a stance of humility to anticipate the most exceptional crises by combining transparency and managerial courage.
According to Darwin’s theory, the one that survives is not the strongest, but the one that can adapt to change with vision and audacity.
The challenge for managers is now to transform their businesses by redesigning the relationship with their customers at the centre of their operations, using agile levers as a catalyst for resilience and sustainability, and seizing the opportunities offered by the advanced analysis of data.
This article is an English adaptation of a post initially created in French.