Problem: How do you future-proof your business to survive and profit from radical change?
Businesses, whether big or small, are faced with the overwhelming challenges of navigating the uncharted waters brought about by the pandemic. The violent impact it left has changed how companies win at strategy. While almost everyone gets affected, some companies were able to ‘flip their kayaks faster’ to benefit from this change. Today’s guest, Jonathan Brill, shares that one of the secrets of preparing for the future is to consistently think that what may be manageable 10 years ago will not be manageable today. How do you future-proof your business to survive and profit from radical change?
So what was manageable 10 years ago? Pandemics. We got probably better at intelligence surveillance, all these things to deal with the pandemic. Suddenly, it wasn’t manageable today. And it wasn’t because of the pandemic. It was because of that compound volatility, and most companies weren’t looking at that. They assumed that what had been true yesterday would have been true in the last pandemic was true today.”
Always Plan for Resilient Growth
Jonathan mentioned that there’s an ABC to resilient growth, four core areas that businesses should constantly look at these four core areas when planning for the future:
- Awareness of threats
- Operational risks
- External shifts
- Strategic changes
Along with these core areas, companies should ask questions like:
- What capabilities do your team need to respond to future opportunities?
- How do you pivot in areas of governance?
- How do you manage communications moving forward from consolidating information, sharing it with the team, and building reporting structures around shared data?
- And most importantly, how do you get them to move in a cohesive way towards the future?
The ABCs of resilience basically encourage companies to strategize not for quarterly growth but for a long-term future.
But when Covid-19 came, something really interesting happened, right? It wasn’t what the analysts expected. Xerox’s earnings per share dropped about 69%, whereas HP stayed stable. These are the two nearest U.S. pure competitors. How is that possible? It’s because one was designed for resilience and one for the quarter. Both are highly performance-driven companies. Like HP, which gives a tremendous dividend to shareholders and is driven by quarterly results. But, even in that environment, you saw this radical difference between these two organizations.”
Tip # 1: Focus on External Risk
Focusing on operational and day-to-day concerns helps ensure the team stays on track, but looking forward emphasizes agility. Allow the team to pivot in areas they can control until the practice of pivoting during everyday operations becomes a habit. Make sure that your teams are aware of walls and roadblocks that they may encounter as they move toward their goals.
And yet, we focus our people, right? Operate, operate, operate, operate, operate. Then in so many cases, that just means that we hit the wall harder. We get fast, going faster, and we hit the wall harder. Or we say, we’re going to get agile, and we’re just going to pivot, but we never look out far enough to see if we have enough time to pivot.
Tip # 2: Encourage Behavior Change
Jonathan used examples from actual companies and how they promoted behavior and culture change. Some areas where companies can encourage change includes:
- Promoting independence
- Creating better briefs
- Practicing better communications
- Reward innovation
- Start in small areas
The second is about behavior change, right? If your people know that a tsunami is coming, it doesn’t matter if they don’t have the tools to get off the beach. So, how do you make sure that you have skills to make sense of, to take advantage of, and be resilient to recover from the radical changes around you? To your finances, your operations, your external environment, and your strategy? If your people don’t have the skills, you can tell them that the world’s going to end, and the sky is going to fall, but they’re all just going to run around like chickens.”
Amazon’s culture is remarkable for fostering a sense of independence among its teams. It is possible because of a practice that is difficult at first but ultimately makes decisions easier. A few of the best practices they employ are:
- Sharing information to help the team make better decisions, including helping collaborators and concerned teams understand the most important issue.
- When inviting people for these collaborative meetings, they only invite those who will participate and role in the project.
- They determine timelines when decisions should be made.
One thing that Amazon does, I think that’s really useful, is that they have a focus on using data and using logic. So, using what we know statistically and what we know logically to make decisions. At the beginning of every meeting, whoever called the meeting has a six-page document that they’ve written about, “What’s the purpose of the meeting? What’s the logic? What are the interests of the people involved? And what’s the timeline for making decisions?”
Create Better Briefs
To help with future-proofing their businesses, leaders should guide their teams to where they want to go when giving directions. This is especially true if you will be moving forward with other projects in two to three weeks. This allows the team to move forward without waiting for instructions and decisions. It’s not necessary to give too many details that they can’t think for themselves. Give them the correct information to motivate them to move forward with the project on their own. The key to giving briefs is to give them a big picture.
- Elaborate what you know about the situation and what you don’t know. This will give them ideas on how they can research better.
- What are the criteria to say that the project is a success and a failure?
- When things change, who’s in charge to make decisions?
I’d come in every day, and I give half direction, and one day he just got pissed off. He said, “Here’s how you’re going to give direction to me in the future”. It’s something that’s always stuck with me because it’s so obvious once you hear it. He said, “The first thing is, what do we know about the situation? What do we not know? And what’s likely to change?” If you give people that contextual information, they can start to operate independently.
Encourage Better Communication Between the Team
Set an example for others to follow. Inspire your team to speak up, regardless of position. Especially when they don’t fully understand something. When pursuing an idea, make sure to create an environment in which mistakes and failures aren’t punished.
And then the second is how do you create better executive communication to go lower in your organization so that people have the ability to speak about things they might not fully understand. In ways that you’ll hear because what you know, and you’ve seen this, whenever, there’s a screw-up, someone knew what was going to happen.”
The value of your culture is more important than monetary bonuses. It’s important to set the right tone about the things you praise publicly, what you do when people make mistakes when they pursue innovative projects, and what you expect them to do when taking risks.
What do you publicly reward people for doing? Because at the end of the day, once people get past a certain earnings level, it’s all about ego. All about career survival. So, the question rapidly becomes, how do you shift that? One of the things you just talked about was like, “We want you to make mistakes.” One of the things I talk about is this idea of risk, right? What’s the most, and what’s the least amount of risk?
Start the Change in Small Areas
A final small tip that helps future-proof businesses is to do with meetings. When setting meetings, even though it’s a small part of your overall business, can help the team get into the rhythm of innovating. Make sure to encourage them to set better meetings by:
- Identifying what role people attending will play and clear next steps to take after.
- Let the team know what type of meeting will be held— a decision meeting, a presentation of ideas, or a deliberative meeting, so they can come prepared.
- Let them skip the meeting if they don’t think they’ll contribute anything significant, so they can focus on more important tasks.
In many meetings I go to, it’s not clear what success looks like. So, you get 20 people in a room, $300, $500 an hour. Add this up in a large organization, you can understand where the margins go. When I was working with Microsoft, one of the things that were really interesting was everybody had the right to turn down a meeting. If this wasn’t going to be efficient for me, I don’t need to be there.”
Check Out Jonathan Brill’s New Book
- Rogue Waves by Jonathan Brill