In this interview, Niyi Yusuf, Managing Partner, at Verraki, a business and technology solutions firm, speaks to BusinessDay’s Frank Eleanya on how business leaders can build and nurture resilient organizations, especially in the face of VUCA situations.
The COVID-19 pandemic has tested the resilience of organizations in every corner of the global economy, especially Nigeria. So, what have we learned? And are we ready for whatever comes next?
You have asked two questions: what we have learned, and our readiness for whatever comes next. Let me answer the latter first; No, we are not ready for whatever comes next and that is because we don’t know what can come, we don’t know when the next black swan event will happen. No one predicted COVID-19 or the impact that it would have, so it’s difficult to determine or guess what can come next. No one can ever be full-proof and ready for uncertainties, we can of course prepare so our readiness and response will be better and faster than what we did for COVID-19. We can prepare for crises but must also realize that we are not in control of every variable, even though we may pretend that we are, or wish so. We can only prepare ourselves to be more resilient to tolerate and absorb whatever comes, especially the low probability but high impact events.
That said, if we step back and are humble enough to understand that there are many things we don’t know, perhaps, we can approach life differently. Another thing we have learned is that we live in an integrated world and something that happens in a corner of Wuhan or the actions of a political leader in the USA can impact the world.
A third thing I have learned is that many businesses are built for normal situations, which is why many struggled during this pandemic. Another learning point is the need for resilient leadership, because the role of leadership is critical during uncertainties, to provide hope and guidance, whether in business or government.
However, the most important thing I have learned is that while uncertainties may sound death knells for many organizations, they provide immense opportunities for a few who recognize them and are quick to take advantage. Many companies have become unicorns and quadrupled in value during the pandemic. Many companies are being formed now to respond to COVID-19 opportunities in New York, Delhi, and even Lagos that in a few years, will disrupt the world. Because if we look back, Airbnb, Instagram, Whatsapp, Slack, Uber, Square, and many iconic organisations were established in 2008 during the mortgage crisis; Hyatt, FedEx, Google, Facebook, and Microsoft were formed during moments of crisis. Some great companies are being formed now that we will get to know in another five years. The question for businesses is; will you be part of those great companies?
You have talked about opportunities within the pandemic; what do you think are the biggest challenges you see and opportunities the pandemic brings to transform how we work and live?
There are some obvious benefits; for instance, the pandemic has accelerated digitalization. It has forced everyone; old, young, governments, private sector, social sector, urban dwellers as well as those in rural areas, to digitalize and to embrace digitalization. Last year, if you had told employers that their employees can work remotely for a month from home, they would have scoffed at it. I know an employer who had just installed a time and attendance system in Q4 2019 so that people can clock in at eight o’clock and clock out at five o’clock. And then the pandemic happened and lockdowns forced everyone to sit at home. So digitalization has changed our mindsets and made us quickly embrace technology and work from home and effectively too. There is also a better work-life integration for most people due to WFH.
For the challenges: I see two – the first is digital inclusion and the second is the mindset.
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We have a significant financial exclusion in Nigeria, and we know that above 30 million adults do not enjoy financial services. Not sure what the numbers are for digital exclusion but I suspect they are higher than for financial exclusion, as many people in the rural areas do not have the kind of technology access that you and I. Many people understood the implication of the high cost of data and unreliable electricity supply during the lockdown. Wi-Fi and electricity are typically available for those that live in highbrow areas and serviced apartments, while availability, affordability, and accessibility are perennial issues for the average Nigerian thereby limiting the number of hours they can be online and the volume of downloads they can afford.
I am a member of an Islamic society, NASFAT, and became the president of the society last year. We currently have over 300 branches nationwide, with primary schools, secondary schools, and a university. During the pandemic, we experienced this digital exclusion with many of our primary school students, especially those in the deep hinterlands. Our schools were running online classes but many students in the deep hinterlands in the South and Northern parts of Nigeria, could not join because their parents were unable to afford the data for Zoom, or even afford the smartphones required. So some of our schools had to adapt by developing a scheme to support the parents with cheap smartphones. The teachers would record voice notes or video on WhatsApp, to be downloaded by the parents. So instead of spending four hours online listening to a zoom class, the parents would download all the voice notes, videos, and assignments within 10 minutes. When they are done with their assignments, they would snap them and send them back to the teacher via Whatsapp. I found this interesting and reflective of the challenge of access. So digital exclusion is a huge, huge concern. And the reality is Lagos is not Nigeria.
The second hurdle is one of mindset; the ability of business leaders to accept technology even without the duress of a pandemic. It will be interesting to see how much WFH has become a culture a few years from now. Many companies like Verraki, have been working from home since March 2020 and have been very effective. A company like Andela has terminated its office lease and is now operating 100% virtual. So even if COVID-19 stops tomorrow, we are unlikely to go back to 100% office work; we will apply at best, a hybrid of physical and virtual. I expect many digitalized companies will adopt this.
How can organizations adopt resilience, not only in terms of their business but also their operations, and people?
The first step to building resilience is accepting the reality that there is an issue and things have changed. In the current pandemic, we must realize that there is both a health hazard and safety issue, so we must accept the reality that the world as we knew it has changed and we will have to do more to keep ourselves safe. The remedy isn’t to reject it, in Nigerian parlance, or to wish it away. Secondly, we need to build and maintain a positive mindset that sees growth opportunities. It’s the classic half-cup analogy; do you see it as full or empty. Someone told me recently that the cup is always full; it is 50 percent water and 50 percent air. I think that captures the required positive mindset succinctly, to see opportunities in everything. And it’s not easy; we must train ourselves and our teams to have a positive mindset and look for the growth potential, as opposed to bunkering down in fear. Thirdly, VUCA periods provide a time to focus on interpreting your mission and focusing on it. If you understand your mission and are driven by that purpose, the chances that you will keep going, even in the face of the greatest hurdles are high; you are mission-driven and so will keep your eye on the ball.
The fourth step: do not wait till you have complete information before you can decide. Avoid analysis paralysis, where you keep analyzing and requesting more information before you can understand. In a crisis period, you may not have all the information you need. You have to use available information to build options and take a position. So you must create multiple options and build flexibility.
The fifth step is to build a culture of mutual trust and a safe environment for your people that promotes psychological safety. There are many uncertainties already; you should not create new uncertainties for your partners and colleagues. You need to create a culture where people can ask why, test new ideas, and challenge the status quo. By being able to ask the right questions, hopefully, they will be able to better understand and embrace change, especially the type of change that comes with crisis.
How can organizations and people design for resilience?
When we are designing organizational processes, we typically ensure that we are creating the right user interface and user experience for our customers. So, this is the same way organizations must design their systems and processes to improve employee engagement or experience. Organizations should make sure that the systems, policies, and processes they have in place remove the frictions that irritate employees, slow down work, and make the organization not easy to do business with.
The second thing is to make sure that in designing for resilience, you focus on the five forces that drive growth; people, technology, customer, capital, and entrepreneurship. When you have the right people, they will do the right things to acquire and excite customers. When you have the right technology, you are likely to drive growth. The third is the customer. If you have the right customer types, you are more likely to be on a growth trajectory. When you have the right amount of capital to do business, you can capture opportunities and drive growth. And the last one is entrepreneurship; the ability to take risks to attain the rewards for risk; capital appreciation, market share, and so on. In designing for resilience, you need to focus on these five factors of growth and make sure that you design your policies and systems to enable these five factors. You need to enable your people to be able to excel and achieve their potential. And design to maximize the use of technology. You must also design an excellent customer experience to retain loyal customers. You must also desire your people to be entrepreneurs who can innovate, who can challenge the status quo, and take risks that will lead to prosperity and growth.
The third thing you need to do is to make sure you put the right people, with the right skills, in the right place at the right time and for the right price. And when you do these things right, then you are likely to have great people or great talents working to support the organization. And skills are important, as, in a crisis period, it is the ability to adapt and learn relevant skills that determine resilience. This is why organizations need to develop a culture where staff can be self-directed and can take responsibility for their growth and skills with personalized learning.
When designing for resilience, it is important to design for diversification. You should have multiple suppliers instead of one, so you will not be held hostage when one fails. At Verraki for instance, we have built capabilities across 3 market sectors – services, the public sector, and the real sector. We have been seeing good growth in services compared to the other two sectors, largely because Nigeria is becoming a service-oriented economy. This diversification has helped us, as we can serve, for instance, telecoms, or banking or transportation sectors when the oil and gas sector is not growing. That’s the benefit of diversifying your services.
And lastly, to design for resilience, learn to set micro-goals, especially within a crisis period. You don’t set a goal for a year when you are not sure what will happen. You set a goal for a month. After you achieve that goal, you set a goal for the next month or quarter. And these micro-goals should reflect the situation at that moment and align with the realities of the day. The attainment of these micro-goals will help build momentum for growth instead of despair and despondency.
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