Living in a VUCA (Volatile, Uncertain, Complex, Ambiguous) world and strategies to deal with a VUCA environment, was a favorite topic in strategy discussions, MBA classrooms, and multiple business case studies. Little did anyone predict that come 2020 and the whole world will be jolted into the most unpredictable of all VUCA scenarios, which most likely, none, we repeat, none were mentally, physically, or infrastructure-wise prepared for.
But then, uncertainty and unpredictability have always been a vital part of any business journey. Smart leaders know that only great risks can yield great results. While uncertainty can paralyze decision-makers, it can also create a platform for resilient players to emerge victorious by calculating their risks and playing to their strengths. A good leader already knows when to engage with risks and uncertainty and create opportunities for success.
When faced with unforeseen challenges, the most natural reaction for business leaders and key decision-makers might be to focus only on the immediate needs which address the current crisis. An underlying urge to do away with traditional performance-management systems or strategy-execution frameworks might also be a common trigger in such situations. However, this can result in a lack of clarity, focus, and alignment, and will ultimately cost you the engagement of your employees dearly. How, then, in times like these, should your organization transition from traditional ways of planning and setting goals to a more flexible, focused, and outcome-based approach?
When faced with a crisis, leaders with high survival instincts hit the crisis button mode and gear up to identify whether or not the impact is an opportunity, a medium-level obstacle, or a high-impact emergency that can put them into Survival Mode. Survival of the business is naturally of utmost importance, and leaders must always keep a keen eye on these business metrics. Depending upon the business context, strategy, and actions, the desired outcomes would mirror the company’s direction.
Assess the impact - are you in opportunity mode, survival mode, or something in between?
The best strategy for survival in an unpredictable climate, for a business leader, is to embrace flexibility and ambiguity. At the same time, it is vital to identify worst-case scenarios and prepare a course of action should the situation arise. A steady approach to working towards a state of stability is what gets most businesses sailing successfully once the tide evades.
Beyond business issues, a much bigger challenge that awaits leaders is the surmounting fear among employees about, “What now?” and “What’s next?” Studies indicate that one of the best-known ways to deal with uncertainties in the minds of employees is to allow teams to acknowledge their situation. By helping them see their activities are moving the company forward, a smart leader can build both incentive and accountability.
Usually, companies focus all their efforts on establishing a risk-management approach to experiment, analyze, and gain a clear picture of possible options which lead to the highest payoff. Yet business uncertainties often come with hidden opportunities to enable value-based decision-making, thus helping identify potential areas of growth by analyzing previous patterns. This is the right time for leaders to build a culture of accountability and ownership by getting teams together, encouraging them to align, stretch, get experimental to achieve aspirational outcomes, and push the envelope of comfort... All this, without the fear of reprimand and failure. Wondering how to deal with uncertainty while also managing these aspects of your cultural core? We promise it is not as tough as it sounds; all it needs is to reprioritize your priorities. Let’s look at a few ways you could drive this.
Often, companies are so lost in their Business As Usual tasks, they lose sight of the real core of why they exist. Uncertain times are opportunities to take a step back, rejig and scratch the core to ask yourself the most fundamental question “Why do we exist as a company and who do we exist for?”
More often than not, this very fundamental questioning helps companies and teams relook at their priorities, identify possible opportunities underlying the garb of challenges, and fire all their efforts towards achieving those. A bonus point - when you involve your teams in this activity, they connect to the vision of the company and build pride in what they do.
When you focus on individual efforts and recognition all the time, times of challenge breed unhealthy competition. The last thing companies want during times of uncertainty is to have a toxic culture that breeds contempt, is unproductive, and leads to the loss of top talent. Consider shifting the focus from individuals to teams, or, even better - look for honing a culture of collaborative working. Identify strategic goals which require teams to come together as squads/pods and work together to achieve a common goal.
What are the advantages of this approach? No blame games, dependencies are cut, and encouragement of a collaborative spirit and healthy coexistence between teams creates astounding results. And what if they fail? Failures are always learning points for the next set of experiments, and most importantly - if the effort is collective, failure also is collective.
Did You Know: During the COVID-19 pandemic, a luxury goods major turned obstacles into opportunities by identifying a new market and bringing Marketing, Design, R&D, Manufacturing, and HR together to focus on the launch of WFH meetings essentials for tier 2 and 3 markets. 18 months after the product launch, the team dispersed to move to a new market and new product with many learnings and a greater collaborative spirit.
This definitely needs teams to don their critical thinking hats. It’s not easy to shift focus from input vs. output discussions to what and how to create value for their customer discussions. But then, there is always a first time! As leaders, start asking the right questions which help teams sift through the metrics and look for essential parameters which are most essential to move a strategy forward. But please remember, these are not the business as usual ones. Teams need to pick metrics that are lead indicators to showcase how they add value to their customers. Over the years, teams are attracted to picking lag metrics like annual revenue or customer churn. Picking metrics that are lead indicators like product consumption or consumer pulse check scores indicates churn a lot sooner! Moreover, many of these metrics can be co-owned by teams and different teams can work together to control these lead outcomes collaboratively.
Let's consider product consumption metrics - your product team, engineering teams, customer experience teams, and marketing teams are all key stakeholders which can work together to increase product consumption and also bring in insights into how the next feature or next product could shape up, keeping in mind the core - your customer’s needs and the why of your existence.
Collaboration doesn’t just happen by bringing teams together to work on a common goal. It needs a lot of cadence, regular check-ins, and discussions that focus on how their tasks/activities are contributing to real outcomes and are not just yet another task off the checklist. These meetings should not focus on the ‘why’ questions but more on the ‘what’ and ‘how’ questions which bring the focus on solutions and outcome generation. Such check-in meetings have been shown to increase the team’s confidence in taking up new experiments and initiatives to bring about results. But the underlying rules for these would often be
Consider this: An ed-tech major that grew at 10X speed and growth rate introduced the culture of collaborative check-ins weekly or fortnightly amongst their teams. The focus was to discuss progress, identify blockers early and call out internal dependencies which could help teams in accelerating their efforts towards achieving desired outcomes. The result of these meetings Q-o-Q resulted in helping teams break silos, prioritize better and pick only those activities that could help achieve the end outcomes. All with an underlying theme of enhancing customer experience.
Uncertain times come with the challenge of managing the complexities of introducing new frameworks alongside existing processes! When it comes to growth, leaders need to try various experiments to achieve the desired outcome without actually penalizing teams for doing so. Forward-thinking leaders can leverage this extensively to promote a culture of taking on experiments without worrying about failure. A lot of these experiments help in shifting the perspective on the traditional approach toward business objectives. Cumulative inputs during conversations can be used as feedback by leaders, rather than traditional compensation reviews. Compensation reviews are most often decided using lag indicators, whereas healthy experimentation propagates using lead indicators as an index. Today, many such experiments run as standalone projects contributing to business growth in many companies. Reward your teams for taking risks and attempting to achieve aspirational goals without penalizing them in case of failure.
Let outcomes and goals not be cast in stone. Keep them agile, but most importantly, outcome-focused. If you need to rework a strategic priority at the company level, then be it, let the next-level teams realign vertically and bi-directionally. Use the check-in meeting scheduled to discuss changing priorities, change in efforts and schedules, the need for leverage of extra collaboration (as long as they make business sense), contribute to outcomes, and most importantly, stay true to why you exist and for whom. Just be careful, don’t cross the fine line between agile and ad hoc, because that's where chaos begins.
Whatever you focus on to give you stability and comfort during times of uncertainty, the one constant is that change is a slow and time-consuming process. However, with the current turn of events, the reality is that there was no time to prepare for this change on such a mass scale. Depending upon your business context, strategy and actions, let your strategic moves mirror your direction. But most importantly, keep in mind that it is your people who will keep you sailing through these challenges, so focus on giving them a safe space at work and waiting for opportunities to thrive.
Richa is a Certified Leadership and Strategy Coach. As an OKR Coach, she helps organizations get laser-focused on identifying their strategy in alignment with their business mission. Having coached more than 500 teams globally, she focuses on helping build OKRs as a culture for sustained cadence and not as a one-time process. She likes writing about strategy execution, building high-performance organizations, leadership, and employee engagement.
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