How to remodel your business to prosper after COVID

You’ve got your current situation under control but how will you develop a vision for the future, one that positions you to serve the dramatically different needs of customers post-lockdown?

Accelerating plans for becoming a more digital business is part of it but what if customer needs, taste and demand shift significantly?

If for no other reason than diligent risk mitigation you need to explore different scenarios against that backdrop. That’s what will help you to prosper.

Flow Academy is a leading advisory and implementation practice specialising in business transformation. Our tools help companies make best use of their existing assets while reshaping their business to meet new demands.

Doing this in the company of a major consultancy gives you access to the consensus way of thinking. You can align with every other business served by the big firms. But we like to think differently. That’s why we’ve created the Flow Operating Model with associated value discovery tools.

COVID requires a thorough rethinking of how we will spend our time in future. What we consume, where we consume. Our desire for a return to normality; our acceptance of a different future.

You can tap into how that changes markets through our CATE value discovery workshops.

Very few companies have yet invested in imagining a dramatically changed marketplace over the coming years. Yet COVID will accelerate climate concerns and carbon mitigation practices, the greening and pedestrianisation of cities, the prospect of abundant cheap property lying empty as firms stick with remote work. What could be stopping you from thinking these COVID consequences through?

Three challenges

Consultant dependency: We’ve seen just about everywhere that COVID has been good for large consultancies. Executives need intellectual firepower and this is on tap at places like Accenture. 

So far we’ve observed that the advice coming from the big four is not massively different from the 2008-10 crisis. Restructure! 

And of course that is necessary but in our previous series of articles we pointed out that a future of business unit can use the Flow lighthouse to remodel the enterprise and not just restructure through cost-cutting.

Consensus thinking: There is a natural tendency for executives to seek out common language and popular memes. To not be in the know is to appear as though we are left behind.

We’ve seen in the agile space how companies have set targets for the number of agile coaches as if crossing this threshold makes you more agile.

This is not a time for consensus thinking. Customers are going to want new experiences and they will redefine how they succeed with their lives.

Project overload: Many companies will find they have already struck peak project load and can’t take on any more new initiatives other than the inevitable restructure or without alienating key staff.

However, that is going to leave them exposed as the new demand curve takes shape.

What will change in consumer demand?

We see a number of changes that will impact demand. We have become aliens in our own world, conscious that we have been contributors to disturbing the natural balance between wild and civilised life. 

How will people compensate for the feeling of strangeness and culpability? 

Couple it to the stay at home life we are now living. Will it change aspirations away from periodic escapism (holidays, movies) to a new realism of permanent adaptation to the hidden power of nature to disrupt us? 

Surely this will lead to us seeking more meaning over more consumption - the return of creative activities, and a redefinition of what success looks like.

COVID will also provide a major new momentum for climate change actions.

We are seeing it as cities are redrawn around the needs of pedestrians and cyclists, potentially a reaction against the car and especially luxury motoring.

But homes are being redrawn too, as sanctuaries for some, playgrounds for others. As we spend more time in our homes we will adapt them to express more of our overall needs, not just leisure or family but also work and creativity.

Travel has been rapidly redrawn - return of the road trip; the decline of hotels, holidays as luxury isolation.

There’s also a case for descaling industry, enterprises and society. New products will have to be simpler so that production facilities can use distancing; the economy can’t go back into full production because that’s how we interact with each other, so we have to determine which elements of production are essential to future needs. 

Our relationship to society is also beginning to change. There has to be an expansion of school facilities, hospitals, and welfare beyond anything any government anywhere has been contemplating.

With it comes the return of worker power represented by trades unions and bolstered by safety issues. And there will be rising tensions between beneficiaries of pre-COVID and beneficiaries of post-COVID, those who want the old normal and those who see more success in a new one.

How can you create discipline around responding to those changes?

Senior leadership teams need a mix of creativity and discipline to address these issues. At Flow Academy, we think of this as a value discovery journey. 

The difference with normal value discovery work is we would recommend working through the value discovery process with at least three scenarios. There is no way to have confidence in any single outcome of COVID.

So think in terms of those scenarios and use an approach like this:

The disruptive scenarios

What causes economic disruption is fairly well documented. 

In a corporate sense it will be smaller companies or other competitors entering the market with what looks like a poor quality product. Your existing customers might not take it seriously but it will breach the market at the bottom end of spending.

Structurally, disruption is happening because companies with vision are not sticking to their core. Take an example in oil. Everybody so far is going with renewables and hanging onto the oil franchise.

The disruptive step is to move outside these confines and begin new areas of business that can benefit from the existing assets of an oil major.

That’s how Amazon and Alibaba think. How can I integrate new areas of business into what I already do well?

New entrants and powerful platforms that can move into any area of business where they can bring customer success will reshape the market around you unless you are quick out of the blocks.

Remember after 2008 some of today’s new behemoths began to make their mark: Whatsapp, Instagram, Uber, Pinterest, Slack, Square. Cloudera.

Value discovery

In an earlier article, we spelled out the steps towards new value discovery. The most important point we made is that, most likely, you already have all the ingredients needed to start creating new products for new demand. The challenge lies in taking one step out of your core business and one step into something new.

That challenge is really about leadership rather than anything technical or analytical.

But if you want to reach that step then we have the deep market segmentation techniques to help. Create the segmentation. Move on to asset discovery. Rethink your core assets and how to deploy them differently. Only innovate around ideas that are targeted at greater customer success. And finally explore who will make up a productive ecosystem to help you bring customer success closer, faster.

The generative operating model

In order to deliver on the new promises you will have to make to customers, you need to improve your skills at remodelling the business so that it can deliver.

Flow Academy’s upcoming Flowpedia spells out exactly how. As we said last time out, the Lighthouse Project is the new vehicle for innovation. You have to move beyond MVPs, pilots and prototypes to Lighthouse Projects because they carefully combine product or service innovation with insights into a remodelled organisation. 

It helps you hit the right spot with customers and also educates your people on how to change the structure of delivery and the way they work. For more details see:

https://www.dhirubhai.net/pulse/three-steps-navigate-covid-change-curve-successfully-shaughnessy/

Given COVID has introduced us to the worst recession in centuries, leadership for change has to be braver than ever. Courage in lighthouse leaders is the subject of our next article where we’ll once again introduce three challenges and three answers. Stay tuned for Thursday!

Haydn Shaughnessy is a business economist and innovation expert who has consulted to some of the world’s leading organisations helping senior executives to plan the next generation enterprise.

Fin Goulding is a world-class CTO/CIO who in the past five years has transformed into a business agility expert having worked for organisations like Visa, RBS, HSBC and digital startups such as lastminute.com and paddypower.com. Fin also coaches executives through the challenges of transformation.