The rapid spread of COVID-19 all over the world has surprisingly overshadowed other recent epidemics in both size and scope. With the deadly global human toll and the disruption of millions of people’s lives, the economic damage alone of the pandemic is already extensive.
During this time of challenging uncertainty, business leaders around the globe are already concerned about the effect of COVID-19 to their companies. As such, the COVID-19 outbreak has now become the litmus test case for good and bad business leadership.
A leader’s primary responsibility is to their stakeholders. They have a responsibility to keep their employees safe, cohesive, and productive.
Regardless of the extent of the impact of COVID-19 on the organization, resilient leadership will distinguish successful executives as they guide their firm towards the global health crisis.
The black swan crisis that is COVID-19
James Heskett, an academic from the Harvard Business School, has recently called COVID-19 a black swan crisis. Black swan events are unforeseen or unpredictable crises that often have extreme consequences. It often has multinational, if not a global impact.
A black swan crisis like COVID-19 cannot be avoided. However, organizations can prepare and respond to it effectively in cases when it does occur.
Deloitte noted that a typical crisis plays out on over three timeframes:
- Respond Phase: The company deals with the present situation and manages business continuity.
- Recover Phase: The company learns and emerges stronger from the crisis.
- Thrive Phase: The company prepares for and shapes the “next normal” for its stakeholders.
Organizations need resilient leaders to take the necessary steps that will help mitigate the effects of black swan events like COVID-19 to the firm.
They have a responsibility to consider all three timeframes concurrently and allocate resources accordingly. With the right approach, this crisis can become an opportunity to move forward and provide more value to their stakeholders.
It can even have a positive societal impact on the organization, rather than just bouncing back from the status quo.
Gartner, a global research and advisory firm, noted several leadership actions that business leaders all over the world can emulate to help the company be resilient amidst the COVID-19 outbreak:
LEADERSHIP ACTION 1: Create a central and clear list of priorities.
The organization’s top management needs to set out a clear list of priorities and then cascade them to their local managers with a high degree of autonomy. In times of crisis, an overly centralized decision making body hinders the firm’s ability to respond promptly and do their tasks effectively.
An effective leader empowers their managers to make the best decisions they can in times of crisis, while at the same time keeping in mind the firm’s priorities. A clear, hierarchical list of priorities is essential to avoid disruptions that inevitably leads to an overload of contradictory information.
By keeping the organization’s priorities clear and implementing those priorities locally with a high degree of decentralized decision making, the organization will be able to respond to emerging events appropriately.
LEADERSHIP ACTION 2: Pursue a nonbinary approach to problem-solving.
There are always other options besides “yes or no” or “do it and don’t do it” if the organization is creative enough with their problem-solving skills. Encouraging teams to be creative and nonbinary about how they solve critical problems in a crisis can create lasting cohesion and consistency. It will also make employees more productive as they help deal with stressed-out customers and stakeholders.
LEADERSHIP ACTION 3: Be honest and empathetic.
The organization needs to learn how to hone an honest, clear, and empathetic approach when it comes to its messaging during the COVID-19 crisis. Remember to relay information from trusted sources only.
Communicating well also means that the firm is staying calm and collected by not being a victim of panic or hype. The organization should be able to relay clear actions for what to do and when to do it.
LEADERSHIP ACTION 4: Record the stories and capture simple achievements.
Collect notable stories of teams coming together to overcome the adversity caused by COVID-19. These stories matter. Capture the details of these stories and give those people the recognition they deserve. Even something as mundane as employees going above and beyond to set up a VPN system or hilarious anecdotes from conference calls can serve as inspiration from people doing remote work.
Leadership Lessons and Best Practices from the COVID-19 Outbreak
Leadership consulting firm Spencer Stuart compiled a list of leadership lessons and best practices that organizations can learn from when it comes to dealing with the COVID-19 crisis:
LESSON 1: Lean on the organization’s culture.
In times of uncertainty, it is always advisable to lean on the organization’s culture as a compass for decision-making. Notable organizations have responded to the COVID-19 outbreak with agility, and most especially with empathy. For example, organizations can learn from their collaborative culture to effectively transition to doing remote work.
LESSON 2: ALWAYS communicate.
The uncertainty that is exacerbated by a sudden influx of information, even disinformation, from all directions can cause a great deal of confusion and anxiety to the firm’s stakeholders. Cut through the noise by providing a clear communication plan that anticipates all the questions that people will have with the company.
Organizations need to remember that their actions in times of crisis will speak for them. Usually, the firm often focuses on what they say and communicate. But in times of crisis, it’s also essential to learn how to listen. Listening is an important aspect of crisis communication. It will help the firm understand people’s concerns and fears and help give light to issues and ideas.
LESSON 3: Observe how the firm is managing talent.
The transition to remote work revealed the typical scenarios on how working and managing people can be improved. The COVID-19 outbreak has enabled organizations to reassess their standard ways of doing work – from supply chain processes to the structure of team meetings. These things are sometimes overlooked under normal circumstances.
LESSON 4: Don’t forget about employee engagement.
There have been countless studies that showed the impact of loneliness and isolation on the human psyche. Daily interactions with coworkers have been interrupted due to the lockdown and quarantine.
It’s essential to keep employees engaged even while they are doing work at home. Simple tasks such as video calls and virtual coffee chats among team members can reduce the sense of disconnectedness that employees feel when working remotely.
LESSON 5: Don’t let short-term plans hinder long-term strategy.
A rapid response plan is crucial when it comes to dealing with a global health crisis like the COVID-19 pandemic. However, organizations need to make sure that their short-term plans do not undermine long-term brand equity and strategy. It is essential that organizations still remember their core values and brand mission amidst all the uncertainty that was brought by COVID-19.
LESSON 6: Revisit the firm’s digital readiness.
Organizations had most likely put digital transformation as an ongoing agenda item for the past few years. This time around, the COVID-19 crisis, has only amplified its importance. Triggering a faster pace to go fully digital, the pandemic has shown that investing in the right digital capabilities is essential to be fully prepared for a black swan crisis like COVID-19.
LESSON 7: Reconsider how decisions are made.
Leaders from both the public and private sectors have witnessed the shift in terms of how decisions were made and by whom during the COVID-19 outbreak. Companies will typically have a centralized leadership. However, since the outbreak varies per region, this posed an operational challenge from companies with multi-regional operations.
Organizations need to adapt in different ways. Thus, decentralized management control and decision making are essential. This will allow local executives to make the best locally based decision as much as possible. In times of crisis, organizations need to rethink and reassess their processes to be able to adapt to a crisis effectively.
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References:
COVID-19: Early Leadership Lessons from Executives in China. (2020). Spencerstuart.com. Retrieved April 12, 2020, from https://www.spencerstuart.com/research-and-insight/covid-19-early-leadership-lessons-from-executives-in-china
Heskett, J. (2020). What Are Lessons for Leaders from This Black Swan Crisis?. HBS Working Knowledge. Retrieved April 12, 2020, from https://hbswk.hbs.edu/item/what-are-the-lessons-of-this-black-swan-crisis-for-leaders
Mesaglio, M. (2020, March 19). 4 Actions to Be a Strong Leader During COVID-19 Disruption. Retrieved April 16, 2020, from https://www.gartner.com/smarterwithgartner/4-actions-to-be-a-good-leader-during-covid-19-disruption/
Renjen, P. (2020). The heart of resilient leadership: Responding to COVID-19. Deloitte Insights. Retrieved April 12, 2020, from https://www2.deloitte.com/us/en/insights/economy/covid-19/heart-of-resilient-leadership-responding-to-covid-19.html
