What success looks like in the post Covid-19 reality

Two very rapid shocks to our system are happening within six months. Two Black Swans. The first - the emotional, economic and health trauma of COVID-19, we didn't see coming. The second, the COVID-19 economic Bounce Back - that we can.
Best predictions are that the UK economy will contract by 35% this quarter but bounce back (perhaps we should call it Boom Back) to plus 30% in the following quarter. That positive shock is just as hard for organisations to handle as the negative one - think of the impact on supply chains, labour demand, infrastructure use, retail demand, capital and cash flow requirements etc. The bounce back looks like being as short and as sharp as the crash we have experienced. An extreme impact black swan in the other direction. And one you KNOW is coming.
The expectation is that after the bounce back there will be a resettlement of the economy to a new stasis with a smaller GDP on a global scale. I will return to this new stasis shortly.
But first a note on the decisions facing us now. The greatest threat to your organisation right now is in choosing the 'hunker down' option. This may appear counter-intuitive. But in hunkering down (ie reduce costs as much as possible, try to get by with the trickle of business you sustain, scale back ambition and initiatives, return to basics, halt investment in the new etc etc... you've been in those meetings) you make your organisation more fragile to the next shock just as the second black swan looms. You will not be prepared for the shock of the upturn.
The net result is you are choosing to be a victim of the first crash, taking all of the hit with no levers available to you to take advantage of the bounce back. Lose-Lose when you could have at least come out evens with a Lose-Win response.

Returning now to the new, post Boom-Back stasis, the new normal if you will.
I wrote recently about The Second Order Consequences of COVID-19, which I urge you also to consider in your preparations for life after the Boom-Back. In it I start to unpack the disruption that will follow.

To those I would like to add a handful more:
1. Digital magicians have had their day. The mystery of digital is rapidly dissipating as even the most Luddite leader is forced to learn how to DIY digital, to maintain any semblance of control over their business and people. The thing they thought they needed an 'expert' for, they have (and not through choice) found they really don't. This means:
2. Digital Transformation will have to go well beyond the tools and training. Everyone and their aged mother now 'gets' digital. The dads are discovering they can dance at this wedding and they don't care who is watching. So digital transformation must now be more about business models not simply the roll out of Teams. That stuff was always IT. Digital is new ways of working and new ways of doing business.
3. High Street Honeymoon: Pop-up shops. This will be a short term boom. The High Streets will be rammed for while but fall back to a-bit-less-than-now shortly after. So, pop-up shops and everything that supports that will explode. Expect markets to get a new lease of life.
4. Value your people people: The first meeting may be the only one in a travel-budget constrained world. Those who are excellent at building rapport will be at an advantage in rapidly building relationships that can continue online.

I want to build on these now to identify the a broader impact on the skills we value in business and the ambitions we have for organisations. The most important may be an end to the idolising of growth.

Grow Or Die, is dead.
The double black swan shock we are going through, followed by the new globally reduced GDP in the mid-term at least, offers us the opportunity to ask what success now looks like.
Are you a successful nation, company, individual or leader if you earn less this year than last?
We are going to have to get comfortable with answering Yes to that question. At the heart of this challenge is the Grow Or Die mythology.
Today we understand that myth is leading us toward environmental collapse. Grow And Die.
Success in a world of less is more aligned to human happiness. After all, our economy was never meant to simply generate a GDP figure. What should it be for? Perhaps to deliver happiness.
Doughnut Economics offers us some clues: "The framework was proposed to regard the performance of an economy by the extent to which the needs of people are met without overshooting Earth's ecological ceiling." In this model the job of the economy is to generate a safe and just space for humanity to thrive.
If that is the job of the economy (rather than to deliver growing GDP) then what is the job of a business or organisation within that economy?
These questions lead me towards the triple-bottom-line thinking captured in the Planet Experience frameworks I have been developing - and an increasing demand for ecologically sound business and products.
In Planet Experience we have a way of being successful without costing the earth, without taking more than we need, and in line with the needs of humanity.
Being successful in 2021 will be all about how well you adapt to thrive within the constraints of a clearly constrained environment.
Empathy is now a key survival skill where ruthlessness was once lauded. Co-operation and collaboration are back.
And that, already, makes me happy.

Photo by Larm Rmah on Unsplash

2nd Order Consequences of COVID-19

The Great Interruption of 2020 will lead to the Great Disruption of 2021. And this will be a disruption unique since World War II - one which took everyone by surprise and is pretty much evenly distributed in a very short period.
Tech disruptions tend to impact over 20 year cycles. This is something different. COVID-19 is driving massive habit change and with it the potential to have deep impact on society - potentially culture-changing impact. We are seeing the initial impact immediately.
Again, uniquely, we have the Great Pause we are all being forced to contemplate, to prepare for what comes next.
There are the first order consequences we see reported on our evening news. The economic shut-down, the school closures, the strain on supply chains.
And then there are the second and third order to come.

Consider:
1. Demographics: Beyond the first order consequence of the death of one-in-ten aged over 80 (which is about in line with deaths from all causes for the over 80s in a typical year), the bigger impact will be in a slump in pregnancy rates. Since COVID-19 was identified as a risk to pregnant mothers, sales of birth control went through the roof. So we can expect a 3-4 month birth lull in 9-12 months time. That gap will be present as it hits the health service, then nursery education age, school age, college age, and entering the workplace in 18-21 years time. That's a lot of flux for all our institutions to handle. The lull is likely to be followed by a boom.
2. Food: Yep, in lock down we think about it a lot. We make meal plans. We start to value 'fresh', we become very conscious of waste, we find time to make from scratch - all the things the convenience (read Easy) generation(s) have bypassed for 20 years. The first order consequence of disruptions to supply lead to second order consequences of increased valuation of the food we do have. New habits forming now could see a mid-term negative impact on restaurants, fast food outlets, convenience food manufacturers... and a positive impact on organic, locally-sourced, fresh suppliers. Reduced consumption (via reduction of waste) is a likely second order consequence across the board.
3. Education: Lessons, quite literally, are being learned about digital. First educators are getting a rapid education in virtual lessons. This has benefits for meeting individual learning styles, aligning with need in more individual ways vs time of day you find best for learning, pace at which you prefer to learn etc. Just as digital has generated the opportunity to move away from treating customers in a one-size-fits-all way, so it reveals an opportunity for segmenting and personalising education which could rapidly accelerate its outcomes for every individual. And beyond that, digital means expanding the capacity of an individual teacher or institution such that we can now teach the world. There's a UN Sustainable Development Goal on the way to being met, right there.
4. Politics: The emergence of an instant Technocracy (rule by unelected experts) is one we seem quite comfortable with. Our politicians right now (as seen from the UK) are pretty much mouth-pieces for their experts - the Chief Medical Officer and the Chief Science Officer bringing a level of evidence-based rigour to decision-making that our very generalist politicians are quick to defer to. Will this be forgotten when our experts on the economy make comment on issues (such as) Brexit in the future? That remains to be seen but trust is science is (outside of the flat-earthers, anti-vaxxers and 5G fallacy peddlars) at an all time high. This bodes well for a shift in the political landscape toward one where the focus is less on what plays well to the gallery (the populist agenda) and more on a test-and-learn, more honest, approach to dealing with the ambiguity of the economy. Less opinions - more evidence. We can hope.
5. Travel. When this lock down is over I suspect a lot of folk will want to travel for pleasure. But from a business point of view, we have learned a lot about how digital really can replace jumping on a plane. Senior execs have been given an accelerated learning and that has positive impacts for their bottom line. Expect travel budgets to be slashed at the very least - with all the second order consequences for airlines, airports, hotels, car rental, conference venues etc.
6. Antifragility - If that sounds like a made up word, let's talk about business resilience instead (though if you are familiar with antifragility, you will appreciate the difference). The bottom line is COVID-19 has revealed to us again how inefficient being too optimised is over anything more than a short-term period. And we cannot predict, with any certainty worth having, how long that short-term may last. Systems - from supply chains, to ways of working, to value proposition have been revealed to be too inflexible to cope with shock. The first order consequence of that is shattered businesses with the shattered lives they leave in their wake. Second order - businesses that survive will have already made themselves anti-fragile in several ways and those that build after will learn from them. The whole notion of leveraging, fantasy multipliers, business plans built on same-happening-next-year-but-a-bit-more must be swept away. Second order may be in the personal realm - we may have just created a generation of savers, folk who will try to build some anti-fragility into their own finances and ways of living. My guess is this will result in reduced consumption as people seek to live lives in reduced debt, building some cash reserves, fore-going the next new car, TV, phone, foreign holiday. Consuming less and savouring more.

All these consequences of COVID-19 (and I'm sure you can think of many others) accelerate the demand for what I had already identified as twin increasing trends:

1. Ways of dealing with the ambiguous, complex requirements of the digital world
2. Ways of handling the rising prioritisation of concerns for the planet.

The first because we face such a period of disruption in which we may see what is hitting us but we lack clarity as to the connections between cause and effect. We have to probe-sense-respond our way through this to develop the most appropriate digital responses.

The second because we have seen we CAN make a difference (in those pollution-falls stories you will have seen). We all have a renewed appreciation of the simple pleasure of time spent in nature. We are all learning the importance of reducing waste. And we are all appreciating more the damaging impact of unchecked consumption on our own lives and on the fragility of the systems, economic and natural, we depend on.

Change is coming. You have time to act. Don't waste the opportunity.

Photo by Melissa Askew on Unsplash