Everyone is talking about the ‘new normal” meaning that “things” will never be the same again and we’ll have to bally well get used to it.
Yet the same commentators talk of recovery and reopening as if it will merely be a case of removing dust sheets and shutters and opening the doors to unchanged customers as if nothing fundamental has changed.
Ignore the screams from the right that “No, No, No! The business bail-out is not the S – Word” but a proper intervention by right-wing governments to protect capitalism.
Ignore the counter-screams from the left that they were right (sic) all along; that the scale of the furlough system is proof as if proof were needed.
Neither is true.
The future belongs to the political centre, and no one will return to work unchanged by an experience which matches any of the significant milestones in history, in impact if not in scale.
The reason is one word: terror.
As Nick Cohen wrote in The Observer (May 16, 2020):
“…surely the reason why the British and so many other populations are obedient is that they are terrified. The only way the authorities can begin to clear up the mess they have made of this crisis is by understanding our fears and showing us how to improvise ways round them. Unfortunately, they show no sign of doing it.”
People will have a different response to the pandemic than they had after the 2008 Crash – terror, not relief.
But notably, the nascent CSR, “purpose” and ESG movements flourished after the Crash. A sign of things to come.
Cynics will point to the fact that, as The Banking Standards Board grimly reports annually, behaviour in the financial services sector has changed little since the Crash and that after we settle back to work behaviour will return to the old normal.
CEOs: you should avoid this thinking trap and believe that at least one component if not all of your target operating model will be redundant post-COVID-19.
Your operating model before the pandemic identified market needs, assembled strategic resources to address those needs and then applied your internal processes to apply resources to meet those market needs.
But even if consumers and business services buyers appear to want the same products and services as before they will undoubtedly want changes to them or in their delivery or both, because of changes to their buying needs and expectations driven by their pandemic experiences.
Even if you continue to use, broadly, the same inputs to your products and services as before, one of these will have changed irrevocably: and that is the mood of”your” people.
“Your people” will be terrified of the virus spiking again, terrified of economic uncertainty and most of all terrified by incompetent politicians and bosses.
They will be terrified that you, their CEO, isn’t up to the job in these new circumstances. They will be afraid that you possess neither the EQ nor the IQ required to create a safe and sustainable environment for them, never mind the usual purpose of leadership which is to create an environment in which they can thrive.
That’s out the window now, for the moment.
Friedman is out, and Maslow is back. You can forget “maximising shareholder” value because the people you need to do that started to abandon that philosophy after the Crash, and COVID-19 consigns it to the dustbin of economic history.
For sure many employees will pay lip-service to ROI because they have to, just as many employers paid lip service to ESG for the same reason.
If you think fear of losing their jobs will drive compliance – think again, for people will undoubtedly comply to keep their jobs, but they won’t go that extra mile you desperately need to “recover”” as you might put it.
So no, your business will never “recover” because it will never be the same again. It can’t.
Forget recovery and reopening, instead reframe, reset and relaunch your business.
Return your business to its “factory settings”. Bin your pre-COVID-19 business plan. Tell your CFO not to produce a re-forecast but to draw up new revenue and cost budgets based on the output of a series of meetings with all your people, your management team and your main board, if you have one to address the following questions:
⁃ what should our purpose be now?
⁃ what strategy should we use to achieve it?
⁃ what behaviour should we employ to implement our new strategy?
If as CEO, you go to a clean page and acknowledge changed market needs, changed employee needs and changed society needs post COVID-19 you’re in with a chance.
Pretend nothing has changed, fundamentally, and you risk decline.
As WB Yeats in different circumstances, A Terrible Beauty is Born.