Leading during extended uncertainty
The current pandemic is one of the worst health emergencies we have witnessed for a century and given the global impact of the Covid-19 crisis, few populations, businesses, sectors, or regions have been able to avoid the knock-on economic effects. The prolonged periods of uncertainty are also making many leaders tired of the pandemic - tired of the lack of interaction with their teams and leading under pressure through the crisis.
The foundations of change
Covid-19 has presented leaders at all levels with a mandate to rethink, refine or even reinvent their business models, with accelerated trends such as digital collaboration and transformation. According to the recent CEO Panel Survey, 86 percent of UK CEOs believe the shift towards remote collaboration is here to stay, and 68 percent say the shift towards lower-density workplace will endure. 59 percent of the surveyed CEOs also put digital transformation of core business operations and processes in their top three priorities. Although most UK CEOs have a pessimistic outlook regarding the economy, the majority are confident in their companies’ growth prospects and are seizing the opportunity to rethink the future of their organisations.
For the majority of businesses, next year will be significantly better than 2020, even if they don’t make a full recovery. Many of the improvements in ways of working, and the cost reductions that emerged, may trigger a productivity revolution as companies work towards a future optimum, rather than going back to their old ways. McKinsey’s research suggests that resilient companies divest 1.5 times more during downturns than non-resilient ones, showing that combining high uncertainty with predicted growth can help to clean up pending issues and accelerate change. Resilient business cut their costs 30 percent faster than non-resilient ones do, but surprisingly the difference doesn’t come from reduced overhead costs, but from real productivity improvements in core processes and leadership.
Leading towards CovExit
Research suggests that continued pandemic levels of remote working could see a £15.3 billion reduction to UK GDP. However, the shift to working from home could have positive implications for productivity and will also open the labour market to more people. According to research, employees and businesses are most productive when they are given the flexibility to choose the most suitable working style based on their individual needs and factors such as family life, home working environment or age. With the shift to flexible working employees who were previously based in city offices will now bring more activities to the suburbs and cities that heavily rely on office workers will have to adapt.
Since uncertainty remains high, decision makers face a real leadership moment. The pandemic has caused major disruption to our working lives in the short term and is likely to change the way that we work in the long term. Covid-19 has caused for many employees to lose their jobs and the jobs that emerge from this crisis are likely to be different than those that were lost. Safeguarding lives is closely linked to safeguarding livelihoods and getting the virus under control while crushing the pandemic related uncertainty is what will eventually unlock the road to economic recovery.
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