Search
Select region
Close filter

“If this, then that”: Towards Scenario Planning in the Uncertainty of a Global Crisis

Volume 10 | April 2020

Coming into the current crisis, we were already becoming acutely aware of how constant market volatility and uncertainty were necessitating changes in CEO leadership. VUCA (for volatility, uncertainty, complexity, and ambiguity), an acronym derived from the military, had been appropriated into the business world to convey the message. But COVID-19 has taken leaders to places akin to warfare. “You don’t go into business thinking you will make life or death decisions,” explained one CEO facing the moral dilemma of how long to keep workers on the frontlines and when to stop production of high-demand consumer products. Uncertainty is no longer a variable in decision making, it is the central axis around which leaders are negotiating future choices. “The biggest challenge I see with the epidemic is that we are negotiating unknowns,” an industrial products CEO recently told us. “When asked for guidance, I said ‘I really don’t know.’”

After weeks of being immersed in immediate questions about the unfolding situation—addressing supply chain breakdowns, virtual workforces, lock-downs and much more—leaders are starting to tackle the challenge of preparing for what is next. Derived from the Greek, “krisis,” a crisis spans the critical sifting and winnowing of consequences which accompany a disruptive decision. And reckoning with what is passing through the COVID-19 sieve is where many leaders are now. “As the CEO, I am thinking now more about playing offense and the recovery and what will be different,” one shared a few days ago.

As leaders move from the emergency stage into an adaptive phase of scenario planning, Zander Grashow, an expert in adaptive leadership and business evolution, has organized the many choices they will face into three categories: preserving what is essential in the present business; noticing what is emerging as potentially important to the future; and determining what from the past may become expendable or necessary to let go of. Several CEOs we have spoken with have offered nascent observations as they begin this process.

You have to really live your values. And it is easy to talk about that when times are going well, but how do you live them when things are not?


For many of the leaders, company values are providing the most essential decision-making roadmaps. Just how to initiate future planning with these values in mind is something CEOs are actively considering. It is very clear that “putting people first” is paramount. The widespread, devastating physical and material losses from COVID-19 are eliciting unprecedented humanitarian responses from world business leaders. We are committed to “taking care of the future of our people more than ever” said one. “This is something we feel very strongly about,” another stressed. “And it requires a lot of leadership attention.”

CEOs are also telling us that they realize that the ongoing communication with their employees--all their stakeholders really--is more important than ever. “If we don’t communicate, we feed the fear,” one elaborated. But here, too, the vast uncertainty at large requires leaders to be deeply thoughtful. “[Y]ou have to be real with people. So you have to acknowledge what you don’t know and not lock into commitments that ultimately we can’t deliver on,” one explained. In addition, CEOs are beginning to recognize more emergent factors to build into their nascent planning.
 

We are an industry in transformation…and we see an opportunity to advance many elements of our strategy, but it has to be done in a very thoughtful way, balancing all of the often conflicting priorities.


Many industries are now experiencing massive transformation. Amid the destruction and chaos, COVID 19 has become a strong accelerator of change. That “change is going to continue to speed up” few doubt. Exactly what those changes will come to look like, no one knows at this juncture. But that they will be widespread and impactful seems clear. Moving forward, one CEO emphasized, “Now what we are looking for is a lot of creativity, which is more important than ever,” as is providing an open and secure environment within which this creativity can flourish. The crisis may actually give CEOs the license to make bolder choices and invite new partnerships. As one explained: “It is more important than ever to continue on this transformation with things like agility, being able to co-create and collaborate. A lot of issues today are not sufficient for a single company to solve the problem; you have to work in an ecosystem.”

Increasingly, leaders will find themselves gauging the right pace of action to turn the crisis into a marathon or change journey. From the short-term (where there would be less pronounced downdraft) to the long-term (a much longer period of time and more severe impact), different scenarios will continue to be devised with triggers: “If this, then that.” Balancing these choices against the likelihood of a truly global recession will add a great deal more complexity. With each incremental factor, particular concern will be given to determining customers’ behaviors and needs, to discovering how to keep accelerating and meeting these vital changes.

As to what may become expendable and possibly necessary to let go of, most CEOs are telling us that is still too early to really know, though there are several indications afoot.
 

We have gone through a pretty rigorous review of projects and we have shut down a number of them….Some of those fall in the ‘leave behind’ category.


Rapidly rising unemployment levels are causing some companies to hit the pause button on initiatives that could reduce labor--automation and robotics, for instance. What might become necessary to actually lose remains to be seen. The impact of the crisis has put into sharp focus the real need for change in global supply chains as well as highlighted those organizations with agile ones. One CEO recently shared that “with the shutdown of a critical offshored subassembly, we lost in three weeks the benefits of three years’ cost saving. We definitely see us re-evaluating our supply chains in the context of being less subject to global disruption.” Certainly the prospect of further dismissals is also pronounced; the depth and duration of the expected recession will dictate the measures necessary to remain competitive and sustainable in the long run. Finally, as one CEO called into question: “What will be the expectations of governments as a result of what they have done to preserve not just sectors and industries, but really companies and the workforce?” The impact of government loans and potential bailouts remains to be seen but will surely be part of the evolving equation.

Whatever comes and whichever scenarios finally rise to the fore, most believe that the post-COVID-19 world will be a markedly changed one. The implications for lasting global alterations along the political, social and economic spectrums are clear. Through it all, the most resilient and impressive leaders will be those who address more than the company—those who, in sorting through the complicated negotiations of what to do next, continue to embrace the weight of their communities, to care for and lift them up, however possible. At the end of the day, the greatest legacy of leaders during this time will surely be established by the numerous lives protected and saved, and by the hope and promises for future recovery and growth that their newly calibrated visions generate.

 


 

< Volume 9
A New CEO Mandate

Volume 11>
Embracing Uncertainty for a Brighter Future

 

Browse the Volumes

Volume 1: New Captains of Consciousness

Volume 1: New Captains of Consciousness

Infusing CEO leadership with social responsibility and accountability: Edelman reports that people are shifting their trust to relationships they feel they can influence, above… Read more

Volume 2: Supporting CEO Leadership

Volume 2: Supporting CEO Leadership

“We simply can’t learn to be more vulnerable and courageous on our own. Sometimes our first and greatest dare is asking for support.” Read more

Volume 3: Leading a Collaborative Enterprise

Volume 3: Leading a Collaborative Enterprise

CEO leadership is, by its very nature, a collective and relational endeavor. Still, we often speak of CEOs as if they are forces unto… Read more

Volume 4: The Uncharted Leadership Voyage

Volume 4: The Uncharted Leadership Voyage

The CEO turnover rate is at a record high and appears to be accelerating. How can we better prepare CEOs for today’s reality, where… Read more

Volume 5: The Boardroom as Leadership Laboratory

Volume 5: The Boardroom as Leadership Laboratory

CEOs struggle with developing their leadership teams; boardrooms are living labs for leadership experimentation. Why CEOs should expose their senior executives to board work… Read more

Volume 6: Cultivating Inquisitive Leadership

Volume 6: Cultivating Inquisitive Leadership

Curious, bold leadership is not something you simply have or don’t have; you build upon what is there, you learn it and continue to… Read more

Volume 7: CEOs and Stakeholder Capitalism

Volume 7: CEOs and Stakeholder Capitalism

CEOs face new requirements from stakeholders that calls for greater resilience and purposeful leadership. Read more

Volume 8: Demystifying Courageous Leadership

Volume 8: Demystifying Courageous Leadership

Coming to courageous leadership depends upon practice—it is the building up of small moments of courage, toning the cognitive and emotional muscles of boldness… Read more

Volume 9: In the Eye of the Storm

Volume 9: In the Eye of the Storm

Five tips for CEOs while they work to manage the business and create psychological and emotional safety for their employees during the COVID-19 crisis. Read more

Volume 10: Towards Scenario Planning in the Uncertainty of a Global Crisis

Volume 10: Towards Scenario Planning in the Uncertainty of a Global Crisis

After weeks of being immersed in immediate questions from COVID-19, CEOs are starting to tackle the challenge of preparing for what is next. Read more

Volume 11: Embracing Uncertainty to Accelerate to a Brighter Future

Volume 11: Embracing Uncertainty to Accelerate to a Brighter Future

All over the world, we are hearing CEOs ask the same question: What is the best way to lead and move forward when we… Read more

Volume 12: The Road Ahead for CEOs: Shifting Identity to Enable Change

Volume 12: The Road Ahead for CEOs: Shifting Identity to Enable Change

CEOs have stepped up like never before to do their part in accelerating the movement for justice and reconciliation forward. Read more

Volume 13: A Rising Tide: Creating Inclusive Systems of Leadership Selection

Volume 13: A Rising Tide: Creating Inclusive Systems of Leadership Selection

Since the U.S. erupted in racial protests, many CEOs have taken a public stand against systemic racism, pledging to help dismantle it. Read more

Volume 14: The Advancing Impact of CEO Engagement

Volume 14: The Advancing Impact of CEO Engagement

There is extensive speculation about the impact that leading through COVID-19 will have on the future of the CEO position. Have the past five… Read more

Volume 15: Beyond Resilience Narrowly Defined: The Practice and Impact of Positive Leadership

Volume 15: Beyond Resilience Narrowly Defined: The Practice and Impact of Positive Leadership

Principled, positive leadership is magnetic and indelible. It is what 2020 is calling for. Read more

Volume 16: Leveraging New Possibilities from Old Polarities

Volume 16: Leveraging New Possibilities from Old Polarities

Leaders today need to better manage polarities - but what are those polarities, and how do you reconcile them? Read more

Volume 17: CEO Leadership for a New Future

Volume 17: CEO Leadership for a New Future

The CEOs who seem to adjust best remain cognizant that “what got you here, won’t get you there.” Read more

Volume 18: Creating CEO Allyship for LGBTQ+ Inclusion

Volume 18: Creating CEO Allyship for LGBTQ+ Inclusion

By connecting on a shared human and empathetic level with their LGBTQ+ colleagues, CEOs have the means to enact real and lasting change, and… Read more

Volume 19: Revitalizing CEO Leadership

Volume 19: Revitalizing CEO Leadership

This is a promising moment in time for CEOs to consider how they want to show up as leaders, to listen for and look… Read more

Volume 20: Prioritizing People

Volume 20: Prioritizing People

CEOs are depending on their CHROs, asking: What else can we do to have a positive impact on employees and make a difference now… Read more

Volume 21: Creating New Pathways to Success

Volume 21: Creating New Pathways to Success

Five steps that take leaders through the process of devising options or alternative pathways to reach performance goals. Read more

Volume 22: Featuring “CEOs: Architects of Prosperity”

Volume 22: Featuring “CEOs: Architects of Prosperity”

Our new series, “CEOs: Architects of Prosperity,” has been created to highlight the expanding expectations for CEOs across a wide range of issues affecting… Read more

Volume 23: Balancing Acts: One Leader’s Approach Through Uncertainty

Volume 23: Balancing Acts: One Leader’s Approach Through Uncertainty

A lot of ink has been spilled around how to lead businesses through mounting complexity and uncertainty, but much of what might have been… Read more

Back to CEO Insights

Changing language

Close icon

You are switching to an alternate language version of the Egon Zehnder website. The page you are currently on does not have a translated version. If you continue, you will be taken to the alternate language home page.

Continue to the website

Back to top