THE Covid-19 crisis is unlike any the world has faced in generations. Unlike in the 2008-09 collapse, in which China, India and a few other economies remained relatively stable, Covid-19 has proven to be an equaliser that has brought every economy in the world to a grinding halt.
Putting the "future of work" aside, leaders have to contend with the "face of work" changing overnight. When the work-from-home mandates hit, those with the right policies and infrastructure in place endured the massive shift to remote work with minimal disruption. Others who insisted on holding on to traditionally out-of-date structures struggled with communication norms, governance, decision rights and how to optimise the technology while balancing home/work dynamics.
"When traditional channels and operations are impacted by the outbreak, the value of digital channels, products and operations becomes immediately obvious. This is a wake-up call to organisations that focus on daily operational needs at the expense of investing in digital business and long-term resilience," said Sandy Shen, senior research director at Gartner in their report Coronavirus Outbreak: Short and Long-term Actions for CIOs.
Outmatched and unprepared
Industries have essentially been caught with their pants down, their woeful unpreparedness exposed and desperately in need of leaders who prevent crisis more than managers who scramble to handle them. CXOs, primarily the Chief Information Officer (CIO) and Chief Strategy Officers (CSO) who handle strategy, have become key players in crisis-response plans. The CIO role has become central to contingency strategies because technology now mediates almost every single interaction in business, with full workforces and business function leaders depending on their technology backbone to sustain their businesses. With the third largest labour force in the world and forecasts by IHS on South-east Asia (SEA) projected to rank as the fourth-largest economy by 2050, CSOs in the region are taking extensive measures to sharpen their business and leadership skills.
As it continues to grow as a hotbed for foreign investment by international technology companies, SEA's digital maturity is split between emerging and mature countries with different needs in terms of emerging and game-changing technologies. The region's CIOs report a disproportionately higher rate (38 per cent) of scaling their digital initiatives compared with fit organisations. Their strong interest in Robotic Process Automation (RPA) is driven by the need for "quick wins" as organisations pursue growth without adding significant expenditure for investment. Interest in cybersecurity is in line with the increasing digital initiatives delivery and scaling in organisations while the top three game-changer technologies identified are Data Analytics, Cloud and Internet of Things (IoT). Now more than ever before, technology adoption is critical not just for success but survival.
Once the worst is over, what shifts in strategy and priority need to occur? This is the question to answer as SEA CSOs are challenged to provide a clear and consistent overall business strategy that adjusts to fluctuating market conditions. Uncertainty is the prevailing culprit, affecting organisations' ability to plan properly, to react and to forecast appropriately. Improving anticipation of opportunities and threats is required to win.
Think back to over 10 years ago (SARS) and five years ago (Ebola). Businesses dealt with the immediate needs these previous outbreaks brought on yet proceeded to dismiss high-level post-mortem reports presenting key decision-making and investments. If these reports had been taken more seriously, perhaps the business impact of Covid-19 could have been better handled. The situation was taken lightly and leaders were thrown for a loop.
Cometh the hour, cometh the man
Leaders cannot afford to "wait and see" or maintain a "business as usual" attitude. Whatever business planning that took place even in the beginning of the year is no longer relevant. Instead, leaders will need to adopt an ambidextrous approach that focuses on surviving in the current moment while also setting in motion a "look ahead, anticipate and adjust" digital roadmap. By taking on a long-term view, the business's three-to-five-year plan has to be accelerated and brought forward in order to mitigate further risk.
In this ongoing journey, businesses must learn and develop "digital pandemic survival strategies" as well as become more aware of the need for digital skills and digital competitiveness. The human factor is still and will always be present, but digital runs the process. Don't be surprised when data literacy gets added to the existing 3 Rs (Reading, writing, arithmetic). Businesses can only thrive with a new set of digital upliftment involving all stakeholders, consumers, businesses, IT vendors and investors. Develop better data and analytics systems to enable better predictive insights, addressing problem areas before they become major issues.
Even with the headline-grabbing lockdowns, movement control orders, event cancellations and slowdowns, allowing distractions to get in the way of progress can blind leaders to the bigger picture. Knee-jerk reactions to kill projects could come back to bite leaders down the line.
Keep in mind that only through a holistic understanding of the current environment, assessing the organisation's full technology estate and value of products and services, can leaders then make fully informed decisions about where to make adjustments. Before doing so, articulate these adjustments to all stakeholders for actionable guidance. Maintain these relationships by setting up meetings for bilateral exchanges together with C-suite strategic leaders. Disengagement will be avoided if transparent communication is practiced.
Getting down to the nitty-gritty of business operations requires strategies that are proactive and outcome-based yet agile, combining technologies that fit their needs. Buying technology for the sake of buying and owning it without taking into account what gaps the technology can fit is, to be frank, misplaced investment. Trend-chasing technology will only lead to wasted resources.
Instead, companies will need to scale their leverage of digital across the enterprise and its ecosystem. Adopt the right strategy based on the size of the organisation. A good starting point would be dashboards with real-time analytics. Imagine managing your business like a stock market, with leaders and teams able to analyse, track and report on the company's data in real time with the help of interactive data visualisations. The ability to predict outcomes and therefore implement changes to improve them is very powerful and is an attractive proposition for any CXO.
CSOs should not forget the CHRO and CFO as digital dexterity partners
The heat is now on the CEO and C-Suite team. Management guru Peter Drucker famously stated that culture eats strategy for breakfast. Any organisation disconnecting the two potentially puts success at risk. Perhaps there is no stronger partnership currently needed than the partnership with the Chief Human Resources Executive (CHRO).
According to Gartner's 2019 CEO Survey: CIOs Should Partner With CHROs to Bridge the Digital Talent Management Leadership Gap, "the confluence of CEOs' current strategy delivery needs with long-term talent headwinds means the time is right for CIOs and CHROs to pool their expertise in a leadership partnership. In this alliance, each 'completes' the other's gaps, and they jointly drive the enterprise's talent management efforts."
The above statement also applies to CSOs and CHROs. In a way, the CHRO's role is arguably the most important role in the entire organisation for one reason: they develop the culture. Culture has long been a determining factor in attaining competitive advantage, talent hiring and retention along with employee engagement and satisfaction. While worth its weight in gold, digital initiatives don't come cheap. Chief Financial Officers (CFO) by their nature want to hold back on risking spending, especially during gloomy economic outlooks while overall hiring has to be strategy-based. After all, their recommendations are rooted in the future of the firm's growth, profitability and continued sustainable existence. Everything together has to meet the long-term strategy.
The convergence of culture, technology, investment and strategy has elevated the collaboration required between these three roles to new heights. Any disconnect intrinsically will have a ripple effect that could throw a wrench in the business' progress. Therefore, strategic prioritisation is needed to ensure that resources are wisely spent on implementable actions which will have the biggest impact over time.
Welcome to the new normal
Pandemics have long been ranked low down a long list of threats by the public and private sectors, maybe because previously SARS and Ebola occurred isolated in their respective regions while the rest of the world went about their day as normal. If Covid-19 has proved anything, it is that what is happening right now has established pandemics as a core risk for businesses large, medium and small, akin to the likes of terrorism, climate change and cyber-attacks.
There is a staggering crisis of confidence in leadership, as only 15 per cent of business executives worldwide have confidence in their company's own top leadership to successfully manage disruption. How skillfully, and quickly, CXOs address these current tensions will go a long way toward determining the success and survival of their business. A clear and consistent overall business strategy can better anticipate regional opportunities and threats arising in 2020 and beyond.
Both uncertain economic conditions and the fluctuating dynamics present especially in emerging SEA will force CXOs to reevaluate their strategy constantly, making agility and adaptability a necessity. While more willing to take longer term risks, honing skills of anticipating the turns and speed of change could be the key differentiator in a leader's arsenal. No leader is too good to learn something new, especially when their business is at stake.
At the beginning of 2020, disruption meant evolving business practices and operations as a result of emerging new technologies and workforce digital capabilities transforming the way we work. A few months later, it has taken on a whole new meaning coupled with accelerated consequences for everyone if nothing is done. In order to manage disruption and the aftershock, CXOs will need to make disciplined IT investments while observing social trends and by combining both emerging (cybersecurity, RPA) and game-changing technologies (data analytics, cloud, IOT) to impact business objectives.
- The writer is founder and Chief Executive Officer, The Center of Applied Data Science (CADS)