Coming Out Stronger

There has never been a more challenging time to be a leader. As leaders continue to absorb ambiguity, they need to stay focused on building confidence in the future. Confidence in the future comes as leaders are able to confidently identify and clearly articulate how their organization creates value in a changed world and identify how to transform existing strategy, structures, processes, and systems to deliver that value in a differentiated way to customers.

With the initial wave of COVID-19 cases and the subsequent health, economic, political, and social repercussions, we argued that there were five key elements of a plan to absorb ambiguity and point towards a better future during this unprecedented time. As the ambiguity continues, we continue to focus our clients on these five areas and continue to add resources to help them do that effectively.

Ensure costs are aligned to the new realities in a way that cuts fat, not distinctiveness.

Some leaders took immediate cost reduction measures, and other leaders still need to realign costs to their new economic reality. High performing leaders make cost decisions based on alternative scenarios and financial modeling. This isn’t enough—they also need to filter decisions through the lens of protecting distinctive capabilities that create advantage in the eyes of their target customers. These leaders chart a course to resource allocation that positions them to emerge from the crisis even stronger than before.

When leaders take this approach to cost reduction, they must clarify the distinctive capabilities needed for their business to succeed. Armed with this intent, they streamline work based on its contribution to distinctiveness. This unleashes resources for reinvestment in the work that customers care about by reducing or eliminating other work. Ultimately the organization emerges from the crisis better positioned for the future.

For additional thoughts on strategic cost cutting see the following resources:

• Turnaround Strategy: Steps to Jumpstart your Organization Transformation

• Q&A: Strategic Restructuring for Costs and Capabilities

• Strategic Restructuring: Create a Strategy That Cuts Fat Not Muscle

• 5 Organization Misalignments That Are Hurting Your Business

• Work-Out: An Approach to Streamline Processes and Eliminate Unnecessary Work

• Business Cost Alignment Using the Work-Out Process

• Cost Reduction Framework: Anticipating a Hard or Soft Landing

Build a customer-centric culture.

Faced with sudden economic pressures, many organizations are finding that their employees and leaders have lost their focus on the customer. Here again, the COVID-19 crisis provides a burning platform for changes that might have gone unnoticed in a less demanding environment. Great leaders ensure that even during this crisis their customers get the experience they want them to have.

As leaders build a customer-centric culture, they are able to deliver their brand promises regardless of the current situation. They ensure that customers come away from every experience believing that we have delivered on our promises. They embed brand identity at every customer touchpoint so that leaders and employees are able to deliver the right customer experience anytime and everywhere. When this happens, deep connections are forged that create stronger brand loyalty.

For additional thoughts on building a customer-centric culture, see the following resources:

• Culture is Not Enough

• Your Company Culture Can't be Disconnected from Your Customers

• The Value of a Leadership Brand

Position for customer advantage.

The most important decisions leadership teams make are about how they position their organizations to create advantage. We believe this should be done using outside in logic i.e. start with customers and investors. Good positioning decisions are based upon what you learn from customers, competitors, external trends, and investors. Successful growth occurs when internal capabilities and priorities deliver what your customers want.

For many organizations the external reality is changing. Priorities for 2020, 2021, and beyond are under the intense scrutiny brought on by uncertainty around future consumption patterns, working conditions, and even political and demographic realities. Though there are many unknowns, customer needs will likely shift, competitors will respond in different ways, and industries will be redefined. When leading through a crisis, effective leadership teams respond by doing a thorough evaluation of how well their organization is positioned to deliver what their customers want.

For additional thoughts on refining competitive positioning, see the following resources:

• How Leaders Build Confidence in the Future

• Building Stakeholder Confidence in the Future that Increases Value

• Q&A: Increase Confidence and Build Value

• The Critical Question for Driving Organization Effectiveness

• 5 Principles for Creating Organizational Alignment

• Refining your Strategy: Two Fundamental Strategy Choices 

• Clarifying Strategic Positioning: Enterprise versus Business Strategy