Why crisis management can be an innovation catalyst
“I think we need to scale back, or maybe even stop…”
Have you been on the receiving end of an email to that effect from a senior leader in your organization in response to an uncertain, challenging, and difficult situation?
Or maybe you’re a CEO, executive, or someone drafting such an opening yourself, or thinking about it?
Wait. Don’t send it. Here’s why.
Our instinctive reaction when faced with uncertainty is to hit the brakes. In fact, most large organizations have a vast array of processes in place designed specifically to stop activity at the first sign of any unknown, risk, or uncertainty. Stopping is the safest approach—or so we’re told.
But “playing it safe” is actually risky, especially at times when the world around us is experiencing massive, rapid change.
Stopping activities, saying no, and shutting down is NOT the way to succeed in an uncertain environment. It’s the way to struggle, stagnate, and fall even further behind the tide of change.
So how do you make progress and push through when all your senses are telling you to stop and wait to see what happens?
Here are my top recommendations for an effective plan to embrace uncertainty (while still creating safety), get comfortable with being uncomfortable, and unearth extraordinary opportunities to succeed.
Taking effective action in a crisis
Rather than stop, now is the time to act. By taking action, we create results, and results are what we learn from to inform decisions, course-correct, and take better action in the new future.
It’s a counterintuitive approach, because the nature of uncertainty means we don’t actually know what to do. But paradoxically, the only way to get the information we need is through action—taking your best guess, starting small, and learning your way through the chaos.
We can relate this to someone dreaming of, yet never starting, a business. “Amazing” business ideas are simply models, and all models are only as accurate as the assumptions you use to develop them.
The only way to get the data you need is to take action—test and validate (or invalidate) those assumptions—and learn what is truly fact or fiction.
Stopping, on the other hand, means you’re not learning. You’re stagnating and thereby creating even more uncertainty, even fear.
Starting small lets you learn fast what works, and what does not, by making it safe to fail. So stop stopping and start learning what will work (or not) for you.
Seize the opportunity to shake things up
In normal times, it’s easy for organizations to let bad habits settle in—too many initiatives in progress, poor prioritization, and frequent context switching are hidden costs that take a toll.
Senior leaders or key contributors might have as many as 10-20 initiatives they’re concurrently assigned to. The consequence? Each initiative takes more time to complete, more time to get to results, and generally ends up with lower quality outputs.
It is often in times of crisis, high stakes, and urgency that people tend to exhibit better behaviors that are focused on clear objectives that really count.
Take banking. Globally—and the US particularly—Small Business Administration loans are top of mind right now, and everyone is scrambling with the rollout of the CARES Act. I’m consulting on both sides of the equation—from large banks to scaling (now stunted) businesses, and it’s clear what characteristics help companies be at their best in the crisis.
There’s a clear need from the market—businesses need support to survive the economic impact, and banks want to support their customers.
The objectives and measures of success couldn’t be clearer. There’s a high motivation to deliver, which drives prioritization to fully dedicate teams to the mission, limit work in progress, and get a result to save customers.
Once businesses have alignment, context switching goes down, focus goes up, and people start finishing work (rather than always starting new initiatives in the middle of others).
Now, it’s already become apparent that with SBA loans, some banks are struggling to handle the situation, while those willing to focus, innovate, and embrace the uncertainty are rapidly adapting and producing results for their customers—responding to both legislation tweaks and customer complaints in a timely fashion.
Leading organizations own their results—good and bad—and respond with better systems. Losers point fingers and blame others. Take note so you know who to avoid!
How to fail in a crisis
If you want to ensure you miss this opportunity to evolve your organization and lead your market, here’s what to do.
First, make sure you have multiple, vague, conflicting goals that confuse and eat up the majority of your resources. Then you’ll need to keep initiatives, capabilities, strategies, and teams siloed so the usual bottlenecks, communication breakdowns, slow decision-making, and poor handovers remain in place.
Have your “best” people working on multiple initiatives simultaneously and constantly context switching so they burn out, produce low-quality work, and battle to make real progress on any given initiative.
When there are mistakes, point fingers. When it goes wrong, blame others. Always highlight how great your work is. Only mention others once they’re successful, noting how they finally followed your recommendations.
Slow down your feedback loops (or just get rid of them altogether. You know what customers need, right?). That way, you’ll delay results, miss market opportunities, and risk building the wrong solutions.
Or you might manage to build something of value but it will be too late and have cost you too much money. Either way, you’ll fail your customers in their time of need, eroding their trust and your brand simultaneously.
There you go, disaster made easy!
Creating a game plan for success in real time
Now, if the above sounds like a nightmare, good. You now know you need to take action (if not, I’d encourage you to reconsider). It’s time to develop your Innovation Game Plan.
Urgency creates a unique type of pressure. You can’t sit on the sidelines, hoping and waiting. You need to take risks to get rewards, balancing safety and speed to succeed in the uncertainty.
If you stop, you won’t learn. If you fear change, you’ll fail your customers and fall behind your competitors.
The key is to create your model with explicit assumptions and test them. This process shows you the path out of a crisis, takes just minutes, and will have a massive impact on your outcomes.
So let’s look at what goes into a Game Plan.
First, you get crystal clear about your primary and secondary objectives—what counts and why it matters. Then you prioritize key initiatives to get you there, limiting both work in progress and context switching.
Acknowledge that there will be many unknowns. You may be attempting tasks you’ve never done before. Set expectations that the group is embarking on a joint problem-solving mission, and everyone will be learning and creating knowledge as you go.
Be honest when you don’t know the answer, empathetic and aware that teams may already be suffering with exhaustion. Now is the time to live up to your values.
Make it as safe as possible for people to speak up, raise concerns, or bring up errors. The higher the quality of information shared, the better the quality of decisions that will be made.
Work backwards from the objectives to decide what steps you need to take to reach them—with the minimum effort to yield the maximum impact. What do you need to do in the next month, the next week, and next day? Define measures of success for each stage and your first small step to get started.
Identify the needed skills and dedicate a cross-functional team (fully allocated to solve the assigned problem). Bring in subject matter experts. Assign people to play devil’s advocate to challenge group-think. Invite productive dissent with questions such as, “What are we missing?”, “Who has a different view?” or “What happens if….”
Let that team refine the outcomes for success, and empower its members to make the necessary decisions to achieve them. Now, more than ever, you need to trust your employees to do right by your customers and the business … so give them the authority to do so. You’ll be amazed how much accountability they’ll show.
How you react to bad news will define what people will share—respond with, “Thanks for clarifying the issue—how can we help?”
As you start small, learn fast, and quickly begin to get to results, use the information you gather to make your next prioritization calls, and repeat.
Going back to the Small Business Administration loans example, the leadership of one of my client banks clearly said the most important priority is to take care of customers and help keep small businesses open, to support the U.S. economy.
For context, it usually takes 4-6 weeks for businesses to apply for loans, and another 3-6 months to actually deliver the money. That’s not satisfactory in the current environment.
So they redefined the outcome for success as delivering checks in 2-3 weeks—a 87.5% reduction in processing time in two weeks. And the legislation is still changing. That’s THINKING BIG, yet we started small and have learned fast how to accomplish it.
The bank dedicated and fully allocated a cross-functional group to work on this initiative and nothing else. To figure out how to meet the objective, the team was empowered to make necessary decisions to quickly create descaled, end-to-end solutions to get funding to the businesses that need it.
The team deeply understands the problem, have defined their outcomes and are safely experimenting at speed to find workable solutions for customers in real-time during rapidly changing circumstances—it’s inspiring to see.
Sometimes we need a shock to the system to break the status quo and open up better ways of working to unlearn, relearn, and break through.
Now is the time to harness our need for rapid response, and remove the barriers to rapid learning—for ourselves, our teams, and our organizations.
Intelligently embracing uncertainty and risk leads to rewards that will save businesses, help customers, and free your team to work in meaningful ways so they can experience the positive impact of their work on people’s lives.
And when the work is done, reflect. Remember the mindset and behaviors that made you successful (or not). Make them your mode-operanium going forward, not just your crisis mode.
Or to revise Winston Churchill…
Don’t let your crisis go to waste!
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