The disruption that has characterized 2020 on personal and corporate levels across the world has been phenomenal, with far reaching impact. On a corporate level, it is now apparent that Boards can no longer rely on traditional risk management and business recovery planning efforts which clearly did not anticipate the major disruption that Covid-19 brought on the world.
In Nigeria, it was exacerbated with the #EndSars Protests and the aftermath that saw many businesses suffer irreparable damage. In all of these, some companies did better than others in adapting to the consequences of the pandemic – examples include Ruff and Tumble and Tiffany Amber. Both companies quickly pivoted to producing facemasks, Personal Protective Equipment and hospital linen using exiting capacities.
We also saw Julius Berger go into food production and a major FMCG commence the production of sanitizers. A few companies accelerated their growth in a dramatic fashion – many businesses moved online, delivery services thrived and online shopping giants like Amazon achieved highest growth numbers in years.
For most Boards, the initial reaction to the pandemic was a call for immediate action to mitigate the negative impacts and ensure survival. Many Boards spent time discussing cost reduction, staff matters (downsizing, salary cuts, remote work, health and safety, etc), suspension of marketing spend, slowdown in research and development amongst others. The focus was on protecting the enterprise, preserving the status quo and finding ways to survive.
Leaders took an all-hands-on-deck approach and Boards were engaged, providing input and oversight of management’s plans and offering problem-solving ideas and insights based on their own experience. Some took some very rash knee-jerk decisions that have cost the companies they serve goodwill and public trust.
Now that the initial shock of the pandemic is waning – particularly with the cheering news from Pfizer of a vaccine, it is time to transition from survival to thriving mode. What learnings and opportunities are available to the business from the stress it has had to go through?
To turn the curve, the Board needs to instill confidence and optimism to begin the journey from survival to thriving. This is not false hope or goose-chasing, but a reframing of where the company is, what lessons have been learnt, what changing opportunities have emerged and what the future holds.
To steer the Board in this direction, Don Lee of the National Association of Company Directors (NACD) recommends that the Board should ask the following thought-provoking questions of the executive team:
Firstly, do we think our business has changed permanently, especially on the need for our products or services? How has it changed and why? Secondly have we smartly used our crisis responses to experiment with new offerings, programs or services that could be new lines of business in the future?
Thirdly how are we better off today and better prepared for tomorrow given our pandemic experience? Fourthly, now that we have recovery underway, how resilient are we and how do we reimagine the future?
Whilst the desire to return to normal is powerful, it can also limit the business by defining success as was done in the past and believing that the old normal is viable in the long term. The Board should seek to know if a return to the old normal is enough and what is the new market normal the company should really focus on, ahead of everyone else. Scenario planning that envisions how the enterprise will look when all this is behind us is also useful.
The Board should consider constituting a dedicated Board Committee to invest extra time and work with Management to focus on what the company could do offensively in the near term and look at game-changing opportunities to revamp the business in the post-pandemic era. Such a Committee will work with the Management Team to identify new opportunities that the pandemic presents.
A critical part of a Board’s reframing of the survival narrative is to consciously use a different lens to look at the Company’s capabilities and their relevance and value in a new world with demand shifts and competitive disorder. Don Lee of NACD recommends that the Board should ask the following questions:
Firstly, what do our customers think about our pandemic response, our reputation and our brand? Are there core strengths to be built upon? Secondly, what has happened with our key external relationships, partnerships and venture? Is there a new way to leverage this experience? Thirdly what have competitors abandoned and why? Does this disruption provide new opportunities?
Companies that come out of this alive will obviously consider survival a big win. Very true and justifiably so. However, it is not enough to exist and watch the world go by. The Board should critically examine how it will help Management define and shape a go-forward plan that will see the business thrive post COVID-19. Critical to thriving is for the business to become a disruptor, using available assets and capabilities and recognizing that if they don’t, others will.
Without a doubt, now more than ever, Boards have a lot on their plates as they address the impact of the pandemic on the businesses they serve. It is however critical to recognize that even in these difficult times, opportunities to pivot and disrupt exist. Working collaboratively with the Management team and asking the right questions, the Board can work to articulate plans that will see the enterprise thrive on the other side of the pandemic.
Bisi Adeyemi is the Managing Director/CEO, DCSL Corporate Services Limited. Kindly forward comments and reactions to [email protected]
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