Whether it is going to be the ‘new normal’ or ’next normal’ or some other soundbite confection, the fact is that it will be the new reality for all of us. Many of us will have to face up to uncertainty in markets and business, at least in the short term. Quite simply, every business will face its own unique challenges and no one knows what the future looks like. The best practice we used before the crisis is not likely to be good enough going forward, we need different, more insightful and flexible practices. Whatever the landscape may now look like in your market, progress and success can only be delivered through new insight, ingenuity, relentless, systematic growth and rigorous execution at scale.
With so much uncertainty prevailing in every market each business will be faced with difficult decisions as to what strategies and actions to undertake to respond to the changed landscape. A new manifesto for smarter thinking, systematic execution, value delivery and growth post-COVID operations is needed.
__________________________________________________________________________________
The challenges ahead
Although the crisis has affected different businesses in different ways, the speed and depth of impact on many businesses was profound, forcing short-term emergency action for many. But how have you used the post-impact time to prepare and address the key issues facing your business now? Are you able to answer these four simple questions about the challenge ahead?
Are you clear about the economic and emotional value you offer your customers now and in the future?
In each of your target markets what will be your sources of differential advantage?
How will you systematically industrialise these sources of advantage to drive cost efficiency, revenue, and most importantly, capital growth?
Are your propositions sustainable and is strategy execution able to consistently deliver commercial and customer value?
Delivering truly differentiated value to customers will be critical to navigating your way to success in the short, medium, and long term. But how will your customers have changed? What will constitute ‘value’ in their minds? How will that assessment of value change as the world returns to some kind of balance? And, if customers have changed during the COVID period, will your business be fit to meet their demands in the new landscape?
Inevitably, some aspects of every market will revert to pre-COVID behaviour yet some other aspects will have change irrevocably. So many previous assumptions, based on gut feel and guesswork, will be swept away and we will all need to learn to behave differently, more evidentially, more systematically in order to not only survive current and near term disruption, but also to thrive and grow.
Transition to the new landscape will require a profound re-think for many businesses about the markets and customers the serve and how their business operates. The priority is, of course, to survive, but building-in resilience now to insulate against potential future market stresses and generating new growth by systematically executing new strategies for new and emergent markets will quickly become differential advantage. Organisations, both large and small, will have to think through the ‘bigger picture’ as well as become more socio-economically and market aware.
__________________________________________________________________________________
9 Facets of a 'New Normal'
What facets of the emerging economic landscape should businesses consider in their post-COVID strategies? Here are some that you should consider:
Resilience and adaptability. Smart organisations that can survive short-term pain will be planning market re-entry and the smartest of these will embed new resilience, performance management, and operating systems.
New markets, new customers. Business will have to adapt and re-position to address uncertain future markets and evolving customer behaviours. Orthodox best practice may not be enough to overcome the challenges in unpredictable markets and may be replaced by emergent and novel management practices.
New work-life balance. What is work in a post-COVID world? As people re-evaluate and re-prioritise what’s important and what’s valuable a better work-life balance will emerge as a high priority.
Disconnection and dissonance. Distancing has created a sense of disconnection and at the same time many have found new ways to stay emotionally connected and engaged but there has been profound disruption to the way we work and live we will be living with the consequences for some time to come.
Remote, low contact commerce. As many more people become accustomed to new forms of remote digital commerce the race toward ‘low contact’ e-commerce is truly on, but for many local, personal contact and quality service will still be valued although this, at least in the short term, may also be a different experience.
New economic and social policy. Economic and social policy will shift toward mitigating catastrophic risk and increasing national resiliency and government intervention in industry and business is likely to increase.
New borders. National and personal borders, barriers and enablers of trade and interactions are changing. International collaboration in key industries and amongst national states has increased in many respects and at the same time nationalism and protectionism are also on the rise. And, our personal borders have changed through social distancing, self-isolation and the likelihood of continued quarantine when crossing borders.
Corporate responsibility. Fair gain, people, and the planet will likely drive future market and customer opportunity, brand building, sales, investment, and returns as customers adjust to new value systems.
New differential advantage. Understanding the changed value requirements and competitive landscape will be crucial in developing capability, systematic, and adaptive approaches to build in commercial resilience which will become a source of differential advantage.
__________________________________________________________________________________
Adapting to customers' changing perceptions of value
Customers, that have propensity and ability to buy, will have more control and influence than ever before in the post-COVID world. It will, in the short term, be a buyers’ market in many industries, but buying behaviour and preferences will have changed, influenced by social distancing, diminished access to suppliers, and new perceptions of value. Many potential buyers have become more familiar with digital channels, locally sourced products, and self-sufficiency. Many businesses too, also have also developed new understanding of remote working, shorter, more diverse supply chains, and more efficient use of discretionary spend. Customers are changing rapidly and will have heightened expectations of seamless, ‘easy to use’, ‘always on’ services. All businesses need to respond and meticulously manage the delivery of value to current and future customers in a systematic way.
Delivering quantifiable value to customers will be the critical success factor for all businesses in post-COVID world. But how will customers’ perceptions of value have changed following the current crisis? How will their perceptions of value evolve? What evidence do you have to substantiate those assessments? And how capable is your business at adapting to deliver perceived value now and in the future? Have you re-quantified your markets, are you able to articulate your new Market Opportunity?
Before the crisis, the strategies, value propositions and brands of many businesses were becoming more homogeneous and undifferentiated. Many offerings were indistinct from each other. Sources of differential advantage were not being clearly identified or exploited. In the post-COVID environment undifferentiated strategies, propositions and brands will face a more uncertain and challenging future of price-based competition, cost-cutting, and margin erosion.
Dismantling functional siloes
Functionally focused front-end commercial operations may be obstructing the delivery of differential advantage and growth. Traditional marketing and sales functions have become siloed, fragmented, and disconnected from strategy and commercial outcomes. Customers and business leaders know that functionally defined customer-facing operations are sub-optimal. They know that these siloes make it more difficult to deliver differential advantage to market. They also know that the critical disciplines for managing the most valuable intangible assets and intellectual capital are unclear.
More often than not, customer interactions are tactically driven by internal divisional and functional siloes and the goal of ‘seamless customer experience’ for many organisations cannot be realised. Operationally, siloes present unacceptable and unnecessary challenges in developing sustainable revenues, cash flow and margin, cost efficiency is sub-optimal and effective management of intangible assets and intellectual capital is almost impossible. These 'silo challenges' are likely to be magnified in post-COVID world, where customers make more careful choices and any weakness is likely to be exploited by competitors.
A repeatable, scalable approach to building differential advantage and asset value
For growth to occur businesses must now, more than ever, align customers and companies through insight, innovation, and value propositions based on evidence, rather than gut feel and instinct. Growth won’t happen by accident in the post-COVID world – it must be diligently planned and remorselessly managed. For that growth to be achieved it will require new insight, relentless, rigorous execution at scale: systematic, pragmatic and measurable.
The best practice that was appropriate before the crisis to handle simple and complicated challenges may not be enough. We will need approaches to overcome complex, even chaotic market conditions. What’s required are adaptive systems for delivering differential advantage, cost efficiency, sustainable revenue, and capital growth.
Systematically delivering growth: the engines of success
The challenges presented by the current crisis have amplified operational risks and performance improvement opportunities that were probably there pre-COVID as well as presenting new challenges driven by unpredictable markets and customer behaviour. Now, more than ever, if you cannot easily overcome these existing and new market and customers challenges you may need to think about transforming your customer-facing operations.
Most businesses could begin by considering more efficient and effective engines for growth, more systematic approaches to building value for current and future customers and different ways to measure success and synchronise revenue generation, cost reduction and capital asset growth. Identifying a critical path of the most important disciplines that drive world-class customer value delivery can help guide businesses, customer and market strategy and focus investment and resource and build differential advantage.
Unconstrained by 'organisational orthodoxy' and siloes a new unifying model can emerge like the adaptomy Unified Commercial Engine (UCE). This can be a blueprint for the emergent and novel management practice needed to drive sustainable business growth in turbulent market conditions. Now more than ever businesses need systematic approaches to build new capability and competency, transform customer-facing operations to deliver differential advantage and new customer value. New frameworks like adaptomy UCE provide focus and precision to manage revenue, cost and cash flow and the far more substantial value of intangible assets and intellectual capital.
Embedded within each of the adaptomy UCE engines are several core disciplines, 38 overall. Each of these discrete disciplines is designed to delivery specific value. The disciplines are supported by new operating models designed to build modern, adaptable operations. Your business can us these approaches and the accompanying tools and road-maps to develop an acute focus on creating and delivering future customer and commercial value in a way that outperforms the competition and helps you to ‘win in market’.
This is a manifesto to build scalable, evidence-based ‘engines of success’. It is a 'base-line' for adaptive operations design based on evidence and process. The engine architecture provides precision, focus and systematic ways to unify strategic and tactical capabilities. It provides clear road-maps to drive sustainable revenue, margin, and intangible asset value. This is not about the application of ‘best practice’ or even good practice, because the assumptions and underpinnings of those probably no longer apply in the new landscape. It is about removing waste and inefficiency and creating growth opportunities through emergent and novel management practice, building adaptive systems, operations and organisations that are more resilient and deliver better commercial returns and more customer value.
4 phases of transformation in an uncertain future
1. Sense-check your market, customers and operations
The uncertainty many business leaders now face demands a different way of thinking. Firstly, a more progressive ‘sense-check’ approach is required that is quite different from the formulaic, predictable approaches used before the crisis. While some markets and businesses have, fortunately, escaped unscathed even flourished, the vast majority face volatility, unpredictability, and uncertainty.
To overcome these challenges we need fresh insight, more adaptive, flexible operations, and responsive approaches to market. We are witnessing a sea change in leadership behaviour and management science. We need to make sense of new and emergent market conditions, this will not be just for the short term, it's likely yo be the case for the foreseeable future.
2. Rethink your business now to survive the immediate term
The immediate challenge for many businesses now will be to reengage and retain customers. Knowing your customers and how their perceptions of value have changed will be pivotal.
What do customers look like coming out of COVID-19?
What is your business’s differential advantage?
What’s the quantified value proposition in the changed circumstances?
What is the plan of action to re-engage them?
‘Rethink’ will be the route for businesses that need to assess and bolster current-state operations and lay more stable foundations for a return to operations in the new landscape. They will need to:
Re-calibrate, re-define and re-segment markets and customer opportunities, re-assess revenue generation, cost, margin, buy frequency and propensity
Re-position brands and value propositions against emerging different buying behaviours and preferences and put in place new operating models for an uncertain and different future
Find new sources of differential advantage and revenue opportunities in new and radically changed markets.
3. Activate core capabilities in market for short-term growth
Some businesses will have adequately survived the challenges of the recent crisis but will be unprepared for the organisational and structural requirements of the evolving market needs. ‘Activation’ in the new landscape should address three key questions:
Is your organisation ready to change?
Can you accelerate and re-scale faster than the rest?
Can you adapt and lead in the market conditions?
Organisations that need to ‘activate’ may not only be seeking to capitalise on new opportunities in the market but also to create new relationships with existing customers or substitutional customers in adjacent markets that have a lower cost to fulfil or higher margin opportunity and sales velocity. They will need to:
Develop new customer experiences and align channels, sales, and fulfilment with new strategies, value propositions, and operating models.
Accelerate ‘engage to fulfil’, ‘cost to win’, processes and, critically, cash flow.
Differentiate through experience, channel and new sales and account management practices that are designed for the new normal.
4. Renew underlying operations to build resilience
Organisations seeking to build-in resilience and mitigate the impact of future commercial and ‘catastrophic market risk’ through Core Viable Business (CVB) should be asking:
What is your plan for identifying, planning, and creating your CVB?
How do you retain effective operations and differential advantage in crisis and economic recession?
Do you have the right assets, reserves, and capabilities to compete in the medium to long term?
Defining your Core Viable Business to build a resilient operating model will require you to:
Introduce a more adaptive performance management systems to change, transform and pivot
Reassess and renew performance management systems, build new capability, intellectual capital and flexible capacity management
Define new and different intellectual capital needs to be developed in the ‘new normal’
More than 'recovery'
This is more than COVID recovery’, ‘digital transformation’ or ‘sales and marketing alignment’ this is fundamental transformational change for the way business operates in market and interacts with customers. This can be the DNA of your entire customer and commercial value delivery system.
But it doesn’t have to be, nor should it be, a ‘boil the entire ocean’ challenge. No business will have the appetite nor capacity for wholesale change at this time. This should be visible change delivered through a modular adaptive approach. It should develop and embed disciplines and processes that can then be diligently applied, operated rigorously and relentlessly pursued. These processes will create and sustain differential advantage, clearly leading to customer and commercial value.
The future starts now. Customers need you and your business to act now. Be prepared to succeed.
__________________________________________________________________________________
Leading your team virtually towards whatever comes next
Creating the right conditions for virtual teams to perform.