This article was originally published on WWD and is republished with their permission.
As the coronavirus outbreak continues to disrupt global business, c-level executives are having their mettle tested as they are forced into a crisis management mode, which changes day-to-day and requires a different set of skills.
Here, as part of a series of stories on change management, WWD speaks with industry consultants, investors and business leaders on what skills, tactics and strategies are needed to navigate this tumultuous time. This includes having a tactical focus in managing the day-to-day while also eyeing what’s ahead. Clear and consistent communications is needed, sources noted, and focusing on people — internally and externally — is essential.
What makes the COVID-19 outbreak most challenging is that this a long, drawn-out disruption that is unprecedented. The pandemic is a slow burn that impacts all aspects of a business, and there’s no playbook written for how to manage it.
Masha Drokova, founder and general partner at Day One Ventures, a consumer-focused venture capital fund, said companies need to focus on results, and not the process.
“Focus on customers and listen to them as much as you can,” she told WWD. “Find a way to have a complete understanding of their most essential needs and execute quickly. They need you more than ever before.”
Drokova said she’s seen that having an obsessive customer focus “is by far the most protective of [what Jeff Bezos describes as] Day One vitality. Make calculated decisions quickly. Be ready for high-quality, high-velocity decisions.” She said being wrong is “almost always less costly than you think whereas being slow is going to be expensive for sure. Surrender the fact that you need to be able to change faster.”
Leaders of tomorrow are being shaped by their actions today, and you may be surprised by which leaders in your organization rise to the occasion.
Kristi Maynor, Lead Global Retail
She also said companies should establish clear communication strategies, “with your team, with all stakeholders, with your community.”
“This is how they will understand and be reassured that you’re clear, present and resourceful,” Drokova said. “Discrete and inefficient communication will hurt these days more than before.” She said clear and efficient communication increases trust, and said “everyone at this moment is looking for guidance from true leaders."
Drokova said businesses should also look outside of their own companies. “Embrace powerful trends quickly and surrender to the external waves,” she explained. “You will become exhausted if you fight them. It’s not just a crisis. The future is being shaped right now. It has never been as flexible as nowadays. Consumers’ and companies’ behavior is changing forever. You can shape our future with your receptivity, knowledge and ideas.”
At footwear brand Merrell, the company has taken a “people and team-based approach” as a way to navigate the current market, said president Chris Hufnagel. And clear communications is key. “We’re working to ensure we’re doing everything we can to let our team know that the organization is providing support and as many resources as possible to help them through these difficult days.”
“We’ve also quickly pivoted and reevaluated our meeting cadences and how we communicate, including instituting new workstreams comprised of team members at all levels to move us through these uncertain times and also created new team touchpoints to solve for both operational necessities and help advance our team culture,” Hufnagel told WWD.
“Ensuring our teams are connected to our brand purpose continues to be a top priority, as well as communicating our actions in a transparent, relevant and thoughtful way to consumers and partners through our content and messaging,” he added. “It’s also vital to think about this crisis on multiple time horizons — both the immediate situation on the ground and the eventual recovery. We’re trying to be proactive in every action we take — both to get through the next few months and then to hopefully have a better, stronger team, brand and business in the future.”
The challenges of the current climate are also amplified for discretionary businesses such as fashion apparel and beauty, noted Carlos Castelán, managing director of The Navio Group. “The most important thing to do is ensuring the well-being of employees and customers,” he said. “True leaders can set an example by first taking care of the people who are key to their business.”
Castelán suggests two tactics for companies managing the current crisis. “The first is to help their teams focus on driving sales to revitalize the company during these times,” Castelán told WWD. “Companies such as Nike and Nordstrom announced discounts across the entire site to try to capture some sales. Such measures for iconic brands are rare, [but] this helps keep some additional cash coming in the door while, just as importantly, ensuring inventory does not go stale, which leads to even heavier markdowns or complete write-downs on the balance sheet later on.”
Given the uncertainty of the business and economic landscape right now, Castelán said focusing on “what won’t change rather than what will can help teams identify activities that will advance the business forward regardless of where the world is three, six or even 12 months from now.”
He added that activities aimed at improving efficiency or productivity “via internal processes” or creating a more streamlined customer experience “are ‘no regrets’ activities that can help improve the bottom-line and will have long-last benefits.”
Kristi Maynor, lead of the global retail practice for Egon Zehnder, a global leadership advisory firm, offered a toolkit for executives managing the current crisis. Topping the list was to simply “be human.”
“We are now operating at a very core level of humanity and the retail and apparel leaders with a people-first, purpose-led approach will come out of this with teams that are ready and dedicated to rebuilding the industry,” Maynor told WWD. “So keep communicating frequently, honestly and authentically, and use this time to revisit all of your ways of working to reground your business on what is right for people — your employees and your customers. Earn their trust and they’ll come back to you for the long-term.”
She also suggested companies narrow their focus to broaden their impact. “In discussions with leaders in health care and the essential retail sector, we’ve heard them say they have accomplished more in three weeks than in the past three years as there is no time for endless debate, deliberations, consensus,” Maynor explained. “This ability to focus will be critical for retailers as we emerge into our new reality. At a moment when so much needs to happen, how can you narrow your focus while broadening your impact?”
Maynor also said this is a time when the future leaders of an organization will be revealed through action under duress, and companies need to pay attention. “Leaders of tomorrow are being shaped by their actions today, and you may be surprised by which leaders in your organization rise to the occasion,” she noted. “In the midst of crisis when models of the past are thrown out, you will be able to see the potential of your team coming to life in how they focus, how they learn and how they innovate. Take note of these leaders that rise up, and prepare to develop them and make space for them on your future leadership team.”
Blake Geffen, founder of Vivrelle, the designer handbag rental company, said the current crisis required her to be proactive. “We quickly brought the team together and discussed how the environment is changing and what that means as a company and for our members,” Geffen told WWD. “Making sure we are ahead of the curve is the key to navigating choppy waters. We communicated with our members on a personal level — we made sure every concern was dealt with personally and positively. Collectively, we made sure our members were part of our team and that they know we are in this together.”
In regard to tactics, Geffen suggests listening on “macro and micro level.”
“Don’t wait for news to come to you, set the path before the storm,” Geffen said. “Be prepared to pivot. The more you are aware, the better equipped you are to succeed.”
She said at Vivrelle, “we sat the team down in late February and discussed the potential for the tide turning. We had hoped it was just that, a potential situation, but we wanted to be equipped should that day come. When it did, we had the process in place to make sure our team and members could quickly adapt.”
Finally, Geffen suggests practicing compassion. “Understand that at the end of the day, we are all in this together,” she said adding that the only way to “come out of this unprecedented environment is if we do it together.”
“Take things case by case, be flexible and know it might not be the ideal path in some cases, but it’s the best path now,” Geffen explained. “Internally, make sure you communicate with your team about their concerns and they feel comfortable. From a customer perspective, make sure customer service is your main focus. Let them know, we are all customers in one capacity or another. Be understanding. Excellent customer service has always been our cornerstone and now more than ever, it must be our rock.