A Company’s Secret Weapon To Mitigating A Crisis
Nowadays, companies are forced to focus on the short term for two reasons.
First, the digital revolution is shortening all corporate cycles (e.g. product development, supply chain management, and marketing and sales). Technological breakthroughs, the deployment of innovative use cases, the disappearance of suddenly obsolete markets, the emergence of new competitors and the creation of revolutionary business models are all occurring at an unprecedented pace.
In addition, the crisis caused by the Covid-19 pandemic threatens the survival of many companies and creates extreme tensions within almost all the others, often calling into question their strategic, financial, operational and managerial approaches.
In this extraordinarily difficult context, a large number of corporate leaders logically focus on short-term difficulties at the risk of forgetting to mobilize their stakeholders around a long-term project.
This chronological hemiplegia is all the more detrimental because meaningful management is even more important when a company’s future is uncertain than when it is assured. Indeed, every human being has a longing for meaning and a low tolerance for uncertainty.
The results of the latest global Edelman Trust Barometer show that the general public is looking at companies not only from the standpoint of the products and services they deliver but also from their attitude towards Society.
For example, 44 percent of respondents have recently started using a new brand because of the innovative or compassionate way they have responded to the virus outbreak. Furthermore, the fact that some brands care more about people than profit has gained 26 points in importance as a purchasing criterion.
Three data points from the Edelman survey summarize the ongoing evolution:
- 89 percent of respondents expect companies to solve both societal and personal problems.
- Whether consumers can trust brands or not has gained 28 points in importance as a purchasing criterion.
This is why the way a company engages its stakeholders is not only a humanistic imperative in these times: It also contributes to its competitiveness. The more authentic it is, the more it motives its employees and thereby drives its economic performance.
Incidentally, this will be true long after the Covid-19 crisis has been overcome since uncertainty will define the remainder of this decade: Around 85 percent of the jobs that today’s learners will be doing in 2030 haven’t been invented yet.
To weather the coming storm, leaders and managers will have to attach ever-increasing importance to the purpose, strategy and values they share with their teams in order to engage them. In this respect, a survey recently conducted by McKinsey shows that “82 percent of respondents affirmed the importance of purpose, but only 42 percent reported that their company’s stated ‘purpose’ had much effect.” In addition, “contributing to Society and creating meaningful work, the top two priorities of employees in [this] survey, are the focus of just 21 percent and 11 percent of purpose statements, respectively.”
Democritus famously wrote that a man’s fate is mostly but the echo of his character and passion. This is true for companies as well.