28 Apr Business leadership post pandemic.

 A ‘guest insight’ by Anthony (Ton) Christiaanse.                    

There is optimism in the air. Slowly businesses are opening up and consumers are out and about spending. The stock market is on record highs, house pricing on the rise and even noncentral bank backed currency (crypto it is) and companies that never ever made profit are in demand with investors. Some soothsayers even predict a new “roaring 20-ties” as people will be relieved to get their freedoms back after the various lockdowns.

This optimism is mainly fuelled by historic low interest rates and money in need of finding a home. On the flip side it is expected that when government support towards businesses (tax relief) and employees (furlough) come to an end, there will be millions of unemployed and consumers cash strapped. This is not even taking into consideration the possible negative effects of Brexit and other constitutional uncertainty holding back investments.

Although there’s no way to predict with certainty what the future is going to bring, there is still a need for businesses to anticipate and take some action today. Average consumer behaviour changes will become permanent after 66 days, so many new behaviours will be here to stay. Online shopping, local support and avoiding massed gatherings will not disappear. It will never be what it was prior to the pandemic.

Hunk, Chunk or Drunk?

What does that mean for businesses? Companies will come out of this pandemic either a hunk, chunk or drunk. Are you an online retailer, a supplier of carton to Amazon or a producer of garden tools? It’s likely you’re in the hunk category and will continue to grow. You simply have something we want more of. Are you a casual dining restaurant, a tour operator or an event organiser? You’re in the chunk category and have to lose weight (restructuring). You, unfortunately, offer something we are not that keen on anymore. And there are those who are drunk and are drifting about in search of a new strategy to avoid getting fat and become fit. (Transformation)

As any company will fall in one of these 3 categories there is a need for change. Growth comes with its own challenges like the need for working capital or attracting talent. Restructuring and transformation do need decisive management and a sense of urgency.

Prior to Covid the leadership and strategy were in sync, as the leadership was executing that particular strategy. As the pandemic will force any business to adjust or completely change the strategy, almost by definition the leadership is no longer fit for purpose. To date, the number of leadership changes has been surprisingly low, mainly because the effects of the pandemic are still hidden by strong balance sheets as a result of government interference. It is expected that this will change quarter 3 and 4 of 2021.

An interim mindset

So what to look for in terms of skills and experience? The first thing boards need to accept that industry experience is overrated. That experience is ingrained in the organisation and should not come from a new leader. New insights, creativity, flexibility and strong communication skills are required more than anything else. The other crucial characteristic is flexibility and the courage to change direction, in other words, an interim mindset even if the leadership is hired for the long term. Last but not least, diversity of thought. Different backgrounds and a healthy debate are more likely to result in strategies that can cope with the ever-changing environment.

Planning and forecasting would need an overhaul. Rather than the traditional 3 or 5-year strategic plans, a rolling 6 or 12 months forecast supported by various scenario’s would help in navigating businesses in the future. Diversity of thought can help to develop these different routes. The pandemic could have been predicted, maybe not by current leadership but for instance by authors and movie directors. So having people with a creative background on the board is crucial to avoid navel-gazing.

That all seems a lot to ask for. New strategies, different type of leadership, experience from other industries, scenario planning and diversity of thought. How scary does that sound? All this needs is some strength, so to quote the strongest girl in the world, Pippi Longstocking: “I have never tried that before, so I think I should definitely be able to do that”

Ton is a senior interim executive, former CEO of Vion, the UK’s largest supplier to British food retail as well as former CEO of Brakes, the leading foodservice wholesaler. He is Chairman of major beef processors Stoddart and has previously worked at board level with the likes of Unilever, Sara Lee and Chiquita. A specialist in the FMCG sector Ton has extensive international experience and has recently co-written and published ‘F*ck the price, long live the service’!