How to Lead Organizations through the COVID-19 Crisis
Strategic thinking can help leaders navigate existential threats.
- April 29, 2020
- CBR - Strategy
Experts say they have no idea how the COVID-19 crisis will play out. Our usual ways of life have been disrupted, and we have all been thrust into a world in which intelligent and reliable predictions are difficult to make. We have been left questioning our basic assumptions, with very little sense of what will happen from day to day, let alone next week or next month.
Many organizations—from big corporations to nonprofits—suddenly find themselves facing existential threats. Facilities have been shut down, supply chains have been disrupted, and demand has collapsed. While this is all officially temporary, many organizations will not make it through the crisis.
The warfare analogy has been used by politicians, public-health officials, and the media, so it makes sense to look to military strategy for a sense of how to navigate. Military thinkers have described the battlefield as a VUCA scenario—volatile, uncertain, complex, and ambiguous. We—an entrepreneur, and an executive officer with US Army Special Operations Command—have been working to translate these VUCA insights to a civilian setting, to help leaders think strategically during times such as these.
One night in December 2018, Major Gaines’s unit in Iraq came under rocket attack from a militia force. In an email between us, here’s how he describes what happened:
It is amazing how quickly you wake up when someone lobs a rocket at you in the middle of the night. Grabbing my jacket, I sprinted out of my corrugated metal housing unit, across a small courtyard, and into the headquarters building. Seconds later, the next round slammed into a nearby concrete barrier.
A few months into my deployment as the operations officer for a small task force, things had been going well, and I had settled in to a steady rhythm of planning sessions, coordination meetings, briefings, and, of course, a lot of email. All of those usual agenda items went right out the window, though, because in war the enemy sometimes gets a vote. That night, they cast their ballot in the form of 107 mm rockets.
The process Major Gaines followed that night consists of three simple steps: get your people and yourself to safety, put your people to work, and enter your decision space. It’s only when leaders have done these three things that they can begin to focus on strategic thinking. These steps provide the groundwork for effective decision-making.
Strategy involves addressing primary and secondary questions. The first questions for a business to answer in normal times include: How do we grow, and, how do we win? But in moments of existential threat, secondary questions take priority: How do we defend? How do we stay alive so that we can win in the future?
This is a time to focus on defense first. This three-step process can help leaders improve the likelihood that their organizations will survive. Even if you have already taken one or two of the steps on your own, it’s important to keep the whole framework clearly in mind.
Get your people and yourself to safety
Security is important first, last, and always. If people do not feel safe, their world will collapse, as they will focus on security at the expense of everything else. Provide security for people, and you can start to get back to work.
When training soldiers to evaluate road surfaces for improvised explosive devices, the US Army came up with the phrase “feet, 5, and 25.” First, check the immediate threat that’s right under your feet. Are you about to step on a trigger? Next, look 5 m around you. What is the next imminent threat to you or your people? Then, look 25 m around. What is beyond that? This also has you scanning the areas around your teammates. Perhaps you can see something that is an immediate danger to them that they cannot see. Continue expanding the horizon, looking for other threats that might present themselves.
In an uncertain situation, whether it’s in the army or a quarantined home, the cognitive load can become overwhelming. Leaders need to help address people’s mental and cognitive needs. We’re not all professional soldiers, and the current situation is more stressful than many people are accustomed to.
In the case of a business, security in uncertain times means cash. As a CEO friend emailed recently, “Humans need food, water, shelter, safety. Businesses need SUFFICIENT CASH. The need for cash even trumps your key people. No cash means no paychecks. No paychecks, no employees. No employees, no possibility of a business.” He continued by pointing out that businesses usually don’t fail or enter Chapter 11 bankruptcy because they lack net worth—they fail because they lack cash. “Protecting the Mothership needs to be emphasized,” he concluded.
For an organizational leader, getting people to safety requires asking a series of questions about physical, mental and emotional, and financial safety. They include:
- What does physical safety look like for me and my colleagues?
- What does physical safety mean for our capital assets, software, facilities, equipment, etc.?
- What do I need to do to ensure my own mental and emotional well-being? (Think of the airline exhortation: “Put your own oxygen mask on first.”)
- How can I support, or get support, to ensure the mental and emotional well-being of my colleagues?
- What communication do they need from me?
- What does financial safety look like?
- How do we ensure financial safety for the organization?
- What are we doing to preserve cash?
- How do I balance my employees’ need for a paycheck with the company’s need to stay solvent?
Put your people to work
Once you have secured your team, your next job as a leader is to prioritize tasks and resources—and let’s consider resources first. The COVID-19 pandemic has forced leaders and managers to work out quickly what tasks their teams are able to do despite decentralized workspaces, degraded communications, a lack of access to systems, and home setups where family life continues around them. Leaders and managers then have had to manage expectations, knowing that there is even more friction in the system that is going to slow down work.
The first priority in this step is to address pressing, time-sensitive work that must happen to ensure the safety of the people and the continuity of the organization. The second priority is to get back to the tasks that your team does under routine circumstances. VUCA thinking suggests that, as soon as possible, leaders should get people to recommence with standardized work. This will help settle their minds and make them productive.
Here, an organization leader can consider another series of questions:
- Whom can I assign to ensure the physical and financial safety of the people?
- Whom can I assign to focus on business continuity and survival?
- Who is already thinking about the future growth of the business and needs permission to do so?
- What direction, training, or resources do they need from me?
Enter your decision space
Once leaders have ensured their teams are on top of time-sensitive and standardized work, they can turn to the third step, to enter a decision space. This could be a physical space where they make critical decisions, but we’re primarily talking about a mental decision space. On the night Major Gaines described, he went through a mental checklist as he prepared to respond, asking himself where the attack was coming from, who was doing it, and what their motivation was. Once he had those answers, he began to formulate his response.
As a civilian leader, the strategic questions to consider in your decision space might include:
- Where do we need to conserve and hunker down because the situation is still too dynamic?
- Who or what can take our customers and market share from us now? How do we defend our market share?
- What can we do to grow now?
- Whom can we serve or sell to?
- What can we do now to prepare our organization to grow when this wave passes over us?
- What has made us uniquely valuable in the past?
- Has anything in the present changed that now makes us uniquely valuable?
The crisis will test this generation of leaders as never before. Those who can think clearly, prioritize rapidly, and prepare for the postcrisis era are most likely to pass that test. Although few of us will be confronted with IEDs on our paths, it will help to use the “feet, 5, and 25” shorthand to identify any immediate crisis, the one just up ahead, and what may be beyond that. This three-step process is what wise military leaders follow in times of imminent danger, and what business leaders should heed in the pandemic environment. Our hope is that it will help many organizations and their people navigate very different but nevertheless difficult challenges ahead.
Gregory D. Bunch is adjunct professor of entrepreneurship at Chicago Booth.
Tom Gaines is a major of the US Army and has participated in Executive Education at Chicago Booth.
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