CxO event: prioritising change in the new normal, with Christine

It’s the perennial question of any period following a major disruption: what now? With the market likely to be very different for the foreseeable future, companies will also need to work very differently. But how do they prioritise change? On Wednesday 27th May, Terry Dawson, Director of Investigo’s ERP Business Transformation team, hosted a CxO event on prioritising change in the new normal. It was presented by Christine Ashton, Transformational CIO for Cogventive Ltd and leading digital transformation expert. Christine discussed some of the dilemmas companies are currently facing and how to devise a delivery plan not just to get back to operations, but to plug the continuity gap and get back to social and sustainable growth.

A new kind of problem

“There have been downturns before,” said Christine, referencing such financial crises as the credit crunch of 2008. “Let’s see if we can learn lessons from those of the past. The thing about COVID is that it’s global. You have to go quite a way back to find a crisis that’s truly global in the way this is.”

COVID-19 has affected all business sectors, but in different ways. For that reason, there won’t be the same solutions for all companies. Recovery will require more specific thinking according to the individual needs of the organisation.

Faced with this new kind of problem, what can business leaders do to assess the state of their organisation and start to prioritise their operations moving forward?

Safeguarding

It’s important to think about employee wellbeing, customer buying confidence, virtual finance, the tax chain, data mastery and access. What measures can you take in 30 to 60 days to safeguard your processes, employees and supply?

There are three theories on the shape of the recovery: a V (lasting one or perhaps two quarters), a U (lasting a year) and a hockey stick (lasting one to three years). You need to think about how you have individually been impacted (positively or negatively) and what kind of recovery you should anticipate, as well as how many recovery scenarios you should plan on.

“If you link your priorities to a purpose, the company and your people can get behind it and marvellous things happen. We’ve seen companies do in eight to ten weeks that would normally have taken one to three years to complete. With fewer priorities, it’s easier to tie them to a purpose.”

Which do you tackle first? According to McKinsey, the 14% of companies that plan and transform during a downturn are the ones that come out fighting. They’re on a totally different trajectory to their peers. Companies that are slow to react, or assume their processes remain sufficient and they need only wait for their customers to come back, will be in serious danger of not recovering at all.

Process fitness and efficiency

Companies need to look at everything they can do to accelerate transformation. Many have embarked on projects that they’ve had to stop due to the COVID-19 crisis, but would now like to restart. Look at different ways to re-scope. Regular assessments are an important part of the process. A mid-project review gives you the opportunity to assess your progress and analyse whether planned customisations are going to serve you well, or if a simpler approach is now called for. Then when you resume, consider how you might leverage remote working to help you to catch up.

Look at rapid process tests you can carry out to assess the resilience of key processes. What short term fixes can you introduce, ways of working that enable your response teams to make improvements?

Scenario and sustainability planning

Data is crucial when it comes to scenario and sustainability planning, particularly for projects of nine months to a year. Data is also everywhere. There are many external sources of data that companies can purchase to help assess the state of the market, their peers, competitors and suppliers, as well as customer sentiment. Think about what data will help you plan effectively, or understand the effectiveness of your processes, or find out what customers or suppliers are thinking. “Think of a company as needing its own little weather station,” said Christine. Don’t be afraid to carry out external assessments of employee wellbeing, or simpler assessments helping to prioritise your actions in the short term.

Software vendors are providing access to tools to help you, some of them at a discounted price during the crisis. If you have a big ERP or other complicated structure, does it already include a process mining tool that you were not aware of or haven’t had the chance to use before? Or does the software vendor have sister products that you can get up and running quickly to bring on new talent or suppliers, or measure real time cash flow?

If your business is looking at restructuring, think about the potential scenarios, how you could separate parts of the business in the future. What are the practicalities of pivoting to manufacture different goods? What will be the change impact on an already stretched workforce, for example?

Segmentation

It’s often said that the best way to approach a problem is to break it down into its constituent parts and tackle them individually. The same applies to business. “Segmentation is really important,” said Christine. “Being able to segment demand-side impact, supply-side impact. Grouping things together will help you and your teams get your mind around what’s gone on and help prioritise. Segmenting different activities and areas can help the company’s response teams get better.”

Make the effort to commoditise your business operations where you can, to allow you to pivot and free up resources to help you with reputation, predictive analytics, gaining new customers and suppliers. Once you’ve started to segment, you can decide how much risk you want to take. You can then translate this into resilience themes – intelligent spend, digital supply chain, customer experience, employee engagement, assets.

“Asset management is often underestimated during downturns,” said Christine. “But you’ve got a lot of cash tied up in assets. You might want to pivot and make new things, sell them off, digitalise or automate them.”

“Look at existing programmes and projects with new eyes. Think about how to segment them maybe by timeframes. Use metrics and the things that have happened to inform how you segment. Be prepared to ditch a few of them. Reach out to vendors. Consider technologies you wouldn’t have considered before, particularly those that can improve quality and reduce exceptions.”

It’s important to think about your technology and whether it’s still fit for purpose. Is this an opportunity to adopt cloud, or SaaS fit to standard – tech accelerators out of the box and onto the shelf? “Very quickly, you could have a recovery portfolio of activities to put back to the board. But be prepared, I guarantee that they will not be the same as they were six months ago and you may have to reconsider some things that you ruled out previously.”