Planning for Uncertainty

Planning for Uncertainty

In just three months, a virus which was first identified in Wuhan, China, has become a pandemic which has impacted people and businesses across the globe. The human cost in terms of lost lives, illness, anxiety and disruption is impossible to quantify. The financial cost to businesses and economies will be significant. 

While some governments and organisations will, to some extent, have planned for risks such as this, many will have been taken by surprise. Given the speed at which the virus has spread – the World Health Organisation first heard reports on 31st December, currently 176 countries have reported cases – that is understandable. But as the world grows more complex and interconnected, systemic risks increase, and organisations must to do what they can to mitigate their effects. 

A feature of those risks is they often arrive quickly and from unexpected quarters. Although the specific risk may be unknown, core principles of flexibility, resilience, awareness and innovation are crucial for effective response. The companies that will be least affected by the current pandemic will be those who are able to rapidly change operations and ways of working to adapt to what is, for now, the new normal. 

Being the first to have to respond to the crisis, Chinese companies offer some interesting lessons on how to respond. One of the country’s largest instant noodle and beverage manufacturers, Master Kong, quickly shifted its focus from large offline retail, to smaller retail and online. It closely monitored store reopening, and fed this information into supply chain planning. As such, it is now back to 60% capacity and supply 3X more stores than some of its competitors. 

Chinese cosmetics company Lin Qinqxuan was forced to close the majority of it’s stores when the outbreak hit. However, it redeployed 100+ sales people as social media influencers driving online sales. Those efforts have seen a significant increase in sales in Wuhan over last years’ figures. 

Closer to home, online food delivery apps such as UberEats and Deliveroo have been quick to tailor their processes to meet some of the challenges people are facing. Marks & Spencer’s announced today that their clothing business staff with move to the grocery business to meet increased demand. 

Showing the innovation in their response, many small cafes and restaurants across the country have rapidly implemented take-away and delivery services to continue trading through a significant drop in demand. 

Unfortunately there will be some businesses, large and small, who are unable to weather this storm. Airlines, leisure and travel companies are just some of the obvious potential casualties, and will require government support to survive. 

These challenges will pass however. Once they do the world we live in, as employees and employers, businesses and customers, may look quite different. While it will never be possible for organisations to completely mitigate all potential risks, building in flexibility and resilience are crucial for survival in an increasing complex and volatile world. The list of potential changes is long and will be different for each organisation, but there are come common focus areas. 

People 

Companies across the country have implemented work from home policies almost overnight this week. While the number of remote workers has increased over the last decade, the numbers weren’t anywhere near those that companies now have to support. Remote working brings it’s own benefits – wider access to potential employees, flexible working, potentially higher productivity, etc. – there are also challenges. Also, it is not just a technology problem. Successful remote working requires changes to process, team structure and other ways of working. 

Organisational Design  

As discussed, the crisis is requiring some companies to move staff from one part of the business to another. Typically people’s roles are generally fixed, but there are benefits to a more flexible approach to achieving organisational objectives. While in most cases people will return to doing the role they were hired to do, in some cases productivity and innovation are increased by having less rigid roles. 

Clearly there are two sides to this – Business Continuity and Long-Term Design. For the former collaboration and communication are required to enable a person or team to quickly pick up the work of another. For the latter, creating cross-functional, autonomous teams, can increase productivity and provide the flexibility needed when crisis hits. 

Data

From the stories of how businesses in China responded, it’s evident that those who spotted the problems early and shaped their response based on data, are in a better position now. Companies typically collect lots of data, but that data isn’t always turned into insight effectively. Even when it is, there needs to be a process in place to make that insight available to those who can take action. 

Feedback Loops 

Feedback loops are a crucial part of the process of turning data – insight – action. To best respond to a potential crisis companies need both a bottom up and top down approach. Frontline, customer-facing workers, are often the first to spot the leading indicators of a future problem. They need to be enabled to capture and share this information within the organisations to enable changes to be made. 

At the same time the management, communications and marketing teams need to clearly articulate, both to internal and external audiences, that the problems are understood and action is being taken. A clear message to customers that their concerns are understood, combined with information from those on the ground about how customers are responding, allows organisation to make the necessary changes. 

Technology 

But those changes can only be made if the systems and ways of working are flexible enough to support them. A crisis may require organisations to handle customers switching from offline to online channels. That requires both increased availability at the front-end i.e. web or mobile commerce, and also the back-end i.e. order management and warehousing systems. 

Much of the technology that powers business can be considered legacy. While it is in the process of being modernised, this will need to be accelerated. Cloud, DevOps, Micro-Services and automation will likely be part of the solution. 

But, ways of working are equally important. Are teams able to rapidly switch priorities to deliver a product that was unknown last month? Can teams share workload if required, or do they operate in silos? And do supplier and internal teams operate in a collaborative ecosystem, or are they bound by their particular project? 

For now, the objective needs to be keeping people safe, ensuring vital services are maintained, and protecting the economy. But once we start to see normality resuming, governments and businesses will be left to answer these questions. 

UPDATE:

On Friday an announcement was made that all bars, cafes, restaurants, gyms and other entertainment businesses would need to close for the foreseeable future. Continuing the trend mentioned previously, some of those affected have switched channels, with many trying to offer the same services online. Restaurants offering delivery is one obvious example, but bars are also offering delivery services, and gyms are providing online classes.

Shops have not been ordered shut. But, with significantly reduced footfall many decided that they too would close their doors. While the majority will have online channels they can continue to trade through, one notable exemption is Primark. With stock on in warehouses and in transit, Primark may have to try to roll out an eCommerce offering in record time.


要查看或添加评论,请登录

社区洞察

其他会员也浏览了