This is the message from Eric Partaker, a high performance coach for business leaders, who explains how you can become even more successful during moments of crisis.
Last month we surveyed 206 chief executives, founders and leaders who registered for our Wartime CEO Bootcamp, to discover what kept them awake at night.
And this was the result, with three key themes emerging time and time again: 1 – Cash preservation and creation; 2 – Team performance and morale; 3 – Sales and growth strategy.
I’ll discuss all three topics shortly but first I want to inform readers of our upcoming virtual CEO bootcamp, which takes place in June.
Wartime CEO, attendance will be free and held on Thursday June 11th, from 2:30-5:30 pm (BST).
I will be one of many guest speakers, all hoping to inspire our online viewers to reach their full potential.
We will do our best to demystify what it takes to be successful, by reviewing the careers of international leaders, Nobel Peace Prize winners, sporting champions and CEOs.
While this virtual bootcamp is free, we are hoping to attract voluntary donations which will all go to the NHS Charities
Covid-19 Appeal. And now for the remainder of this feature…
Cash Preservation And
Cash is king and especially in a crisis. Aside from various government sources of funding, here is a series of points which should help you deal with this problem.
* – Remain close to your customers. Be proactive, pick-up the phone and talk. Be compassionate and offer value to accelerate payments. One CEO I know phoned all of his non-paying customers, reminding them that he was prepared to support them long-term. He offered a 25% discount on their annual subscriptions if they paid in full for the year. To his pleasant surprise nearly 10 of his clients took up the offer.
* – Improve your cash conversion cycle. Move faster to be paid sooner. Many companies implement initiatives designed to shorten the time it takes to close a sale. Such initiatives also cover manufacturing a product, delivery, billing and collection of payment. This is the ideal opportunity to shorten the time it takes to complete this cycle.
* – Reset your sales. It may sound obvious but many leaders become so focused on a three-to-six month crisis window, that they pay virtually no attention to the time beyond this period. Of course, the immediate few months may well be life or death for a business, but don’t lose sight of the longer-term. In the current situation, many businesses are ready to accept two poor sales quarters, followed by an 18-month period they would like to describe as ‘a return to normal.’ So make adjustments and plan for a 24 month cycle.
* – Continue to attack fixed costs. If your lease is nearing its end, do you have to renew it? Office supply costs are likely to go through the roof, so you may require less space. Seek to defer, renegotiate, and possibly try to extend payment terms with major suppliers. Adopt the same approach for renegotiation of business rates, loan and lease interest, as well as insurance.
* – Consider other variable cost reductions. All non-critical expenses should have already been stopped. Discretionary spending has plummeted and is likely to remain low for some time. Try to accommodate extended pay cuts. Consider the different tiers within a business: The CEO could take a 50% drop; Executives 30% while all other employees 10%. Can you compress the organisation? Are you able to create a flatter structure with fewer management levels while, at the same time, minimize impact on customers? Hope for the best, but sometimes you may need to plan for the worst. As a leader, don’t let uncertainty paralyse you. Prioritise speed over precision, and continue to update and review cash flow every week. As the environment continues to change, you will need to absorb new information on a regular basis, so be prepared to act on it swiftly.
Team Performance And
A crisis provides an opportunity to shine as a leader. The team’s performance and morale, including your own, will be pushed to the limit. Here are some practical tips to ensure results and vibes remain positive.
* – Communicate more than ever. Hold a meeting, possibly every Monday morning, when the CEO announces the company’s three big targets for that week. Begin the other four days of each week with a 15 minute Huddle or Scrum, when every team member can share in this moment and talk about their plans for the next few hours. End the week with another meeting, when team members can describe their accomplishments. This is an opportunity for everyone to ‘celebrate success.’
* – Recognise this crisis as being an unprecedented opportunity to hire great talent. Who are the A-List players to elevate your business to the next level? What steps must you take in order to make contact with them, especially if they are employed by a rival? Although many jobs are lost during a crisis, this is also a chance to tap into a talent pool outside of your company’s four walls. It’s all about building your dream team and possibly slimming down the current one.
* – Encourage team members to organise virtual gatherings, such as group yoga sessions or quizzes. Make certain the most isolated members of your business are included. We all process and experience crisis in different ways, so make sure that all gatherings reflect a wide cross-section of your workforce. While challenging times demand a shift in leadership, you may discover and develop new tactics that will serve you well in the future.
Sales And Growth
It may sound illogical to think about sales and growth in times of crisis but, nevertheless, this remained a key focus for the leaders we spoke to during our Wartime CEO event.
Despite being a crisis, it is also a fantastic opportunity to grow your business in previously unforeseen ways. Consider the following:
* – Understand your customers’ current problems, then adjust your own sales pitch and marketing messages to accommodate these issues. For example, are your customers facing their own deteriorating sales? Perhaps they’re struggling with market uncertainty or concerned about supply-chain disruptions? Are they wondering how best to manage their employees who may be forced to work from home? Most important of all, are they suffering from cash flow problems?
* – Think less, talk more. In times of war, we seek and create alliances, so don’t try to do everything on your own. Instead, talk problems through with others. Make a list of your top 20 direct or indirect relationships. These are individuals who could lend a hand with your current struggles. Maybe their companies are relatively resilient in their own fields. Connect with them, speak with them, learn from them.
* – Take note of key trends and secure solid investments. Certain industries are thriving at the moment, including ecommerce, pharmaceuticals, logistics, video conferencing, entertainment streaming, gaming and online learning. Others, meanwhile, may be struggling including travel, hospitality, oil and gas, investment banking, traditional retail, professional sports, entertainment and cinemas. How can you capitalise on your strengths in order to take advantage of these trends? What investments do you need to create ‘Your Business’ 2.0? For example, a business that can leverage remote working, whether fully or partially, and can take full advantage using a digital approach, has a significant edge over many others.
* – Follow the ‘Blue Ocean’ route. The publication, titled Blue Ocean Strategy, illustrates how you can redesign your future. It explains how you can reduce complexity and cost, to improve your business model? For example, which deep-rooted traditions within your industry can actually be eliminated? On the flipside, how might you increase value, create new demand, and potentially increase prices in the future? For example, which competitive factors should be raised well above the industry standard? And which new factors, never seen before, can the industry offer going forward?
Andy Grove, former CEO of Intel, once said in a moment of crisis: “I learned that strategic inflection points,
painful as they are for all participants, provide an opportunity to break out from
a plateau and catapult to a higher level of achievement.”
Employ some of the practical tips mentioned above to preserve and create cash, improve team performance and morale, while building sales and growth. Hopefully, my utterings will provide you and your business with some welcome light at the end of a dark tunnel.