NZ BUSINESS 2.0 – NOW WHAT DO WE DO?

Man pondering

When we come to the edge of all that we know, we have two choices; stand our ground, or build
something better.
For all of us – as a nation, a business, and as individuals – things are different now. For some this
week, the move to level 3 has bought little change from lockdown; for others it’s more of a return to
reality – but, regardless, it’s a different reality from the one we operated in before. As Bernard
Hickey said, “an asteroid has hit the world’s economy and social systems.”
What I’m most excited about, however, is the sense of optimism. The rhetoric is positive, with talk of
rebuilding and – I hope – a movement towards better businesses and a better New Zealand.
It’s not that anything was awful before, but for many there was a notion – however vague – that
what we were doing was not sustainable. And there are plenty of opportunities where we could do
things better. New Zealand sits 19th on the Global Competitiveness Index – an annual assessment of
productivity and long-term economic growth. Is that the best we aspire to? Similarly, our labour
productivity sits just below the OECD average and our construction productivity (m² of output per
hour of construction work) has long been declining; it’s down considerably from where we were in
the 1990s.
We’ve been given an opportunity now that we could never have conceived, or brought about,
otherwise. Virtually every assumption underpinning business is now open to question. Things were
already changing and the rate has now accelerated. Now we have the chance to imagine a better
way forward.

Re-emergence, reimagination, and reset

As we accelerate out of this period, and lead our people and brands to a brighter future of full
recovery and achieving our potential again, there are three horizons that we need to be focusing on;
re-emergence, reimagination, and reset.

Re-emergence is how we come out of this crisis. It’s about rebuilding trust and adaptive leadership.
New Zealand acted swiftly, as a nation, to ensure we got through this with our people working
together – and we’ve succeeded in minimising loss of lives from COVID-19. Now it’s time to mobilise
our people for the better New Zealand we’re rebuilding. The key to that is trust.
Trust is the foundation of high performance and it should be every leader’s highest priority right
now. Even if you managed to largely retain your people’s trust throughout this period, uncertainty
has worked against us, and it’s likely your team is freaking out more than you are. Now we have a
golden opportunity to bring them together – and galvanise them towards your shared vision – in a
way that you never have before.
To my mind, the pillars for leading in a way that rebuilds, and maintains, trust include:

  • Total honesty: Be brutally honest with your team. As you share your honest assessment of
    the business’ prospects, couple this with a determination to fight through and the key strategies that you’ll use in the fight.
  • Empathise: This crisis has shown us all our humanity, so demonstrate genuine care for your people; listen to their fears, accept where people are at and encourage them forward from there.
  • Mobilise: Call on the loyalty of your people, involve them in the fight, and empower them to execute. Form a core execution team and connect regularly with them to retain alignment.
  • Communicate: Regularly, honestly, and often. Tie everything back to your purpose and core values and show them that you know the way.
  • Actions speak louder than words: Lead by example and keep your efforts transparent at this
    time.
  • Protect your people: Go beyond ticking health & safety boxes and redefine what it means to care for your people and ensure they feel safe.

Reimagination is the chance we have been handed to imagine a better way forward. Our ‘Transformation of New Zealand’ report includes some of the many practical, political, internal and
external considerations from here. It’s time we think about what we don’t want to go back to and
how we can best harness the change opportunity here. There are three possible scenarios here for
businesses.

  1. Picking up where you left off. Some businesses were strong enough for this to be viable, but
    for most a return to exactly what they were doing before is a mistake. The world – and the
    market – has shifted.
  2. Pruning the edges and planting some improvements. Hopefully, you’ve had clarity now
    around what doesn’t work, as it’s broken under the weight of COVID-19, the economy, and a
    lack of cash. Rebuilding requires cash, so focus on the parts of your business that add value
    and generate cash, then cull the rest so the core of your business has a better chance of
    survival.
  3. Performing a pivot. For many, responsiveness now will be the thing that makes or breaks
    them. Many businesses we’re working with are performing, or considering a pivot of their model or their market towards pockets of increased demand. We created a cool tool to help businesses pivot that you can access in our latest report, or comment below and I will flick it through to you.

Whichever you choose, it’s clear that we will need to rethink certain aspects of how we move
through the world – from what agility and efficiency now mean to how we will conduct our sales
processes in this new world. I’m already enjoying some forward-looking conversations with clients
on this, and similar.

Reset reinforces that we need a new plan now. No business will be ending this year with the same
plan they had at the start, and many will need a new strategy. Key to any plan from here will be
contingencies. We’re driving down a multi-lane highway right now, so it’s wise to stick in the middle
lane. But, as things become clearer, we can test and refine our plan. Having contingencies built in
means you’ve got different routes to take and you can change lanes early, and keep momentum as
you accelerate out of this faster.

Commitment

The other thing that plans need now is commitment.

  • We need a commitment to an increased cadence when it comes to revisiting and challenging
    the plan. Don’t simply tick it off the list once done; look at it daily, weekly, and monthly. Only
    when you are out of the woods – with 4 months of cash cover in a savings account, consistently growing revenues, and a return to an industry standard bottom line – should you move back to deeper strategic reviews quarterly.
  • Reinvigorate your commitment to tracking key metrics. Waiting for ‘end of month’ reports won’t cut it now – you need to be affecting change in the moment, and able to make strategic decisions in real-time, so make sure you have your figures to your fingertips.
  • Commit to the people you have left, and involve them even more than you used to. We~need to harness our collective creativity to get out of this successfully. Look at how you can bring your people on the journey, and what they can take ownership of. After all, those who plan the fight don’t fight the plan.

I firmly believe that now is our opportunity to build better businesses and a better New Zealand. It’s
time to look at what still works, what the world needs, and how we refine or reinvent the rest.
We can move on from here to build better.
It’s time to make a plan.

If you would like to access some of the tools we’ve made available to businesses to help them
through this stage, let me know and I’ll send those through to you. Or, if you’re wondering about
your own version of better, and could do with some guidance, I’d love to chat.

 

This blog was written by Simon Mundell, Founder and Strategic Advisor at Advisory Works.

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Topics: Blog, Business Strategy, Leadership