Enterprise and market resilience - a virtual forum for business leaders during COVID-19

By Robert Half on 28th May 2020

At Robert Half and Protiviti, we believe there is tremendous value to be gained in collaborating and learning from each other at this challenging time. Hearing new and unexpected perspectives from others can help challenge your thinking, provide confidence in your own plans and increase your resilience. 

Every week more than 50 business leaders join our Enterprise & Market Resilience During COVID-19 virtual roundtable. Held under Chatham House rules, the facilitated, secure sessions enable participants to ask questions in advance or live during the discussion.

The aim is to have an hour-long meeting each week on Thursdays and build a community of people from different industries that can share relevant materials and experiences of operating in ‘the new normal’.

Explore the relevant discussion date:

19 March 2020 Snapshot

  • Collaboration between suppliers, competitors and organisations in different sectors will support agile and innovative thinking to support the challenges we all face.
  • For business who can work remotely, it’s important to consider how the tools and policy is aligned to support the culture of the business.
  • It’s expected that more people will work remotely in the future.

While the first session identified some pragmatic approaches to managing virtual teams, participants agreed that the impact on people operating at the front line in healthcare or social care should not be underestimated.

One charity that helps older people in the UK said they didn’t necessarily have the technology needed to operate remotely, and that their people faced risks to their personal health from carrying on giving care at the point of need, for example.

Planning through sudden disruption

For businesses that can operate remotely, there are many technologies that enable people to meet, share documents and communicate online such as Slack, Skype, SharePoint, Zoom and Microsoft Teams. One participant company has always had a ‘remote-first’ policy and finds it works well, even with a team operating in different locations around the world.

However, they stressed that just providing relevant platforms is not enough and that culture and policy both come into play as well, especially when teams are only meeting physically very occasionally.  Their advice was to ask all staff to turn on their video cameras rather than join virtual meetings with voice only, so everyone is familiar with their colleagues and meetings are as interactive as possible. A framework should also be established for communication to make sure it is not either overwhelming or non-existent.

Other tips were to set up virtual events, like morning team briefings, afternoon tea breaks, community learning sessions or drinks/music evenings to keep the team together; and to ensure everyone has access to support for mental ill-health caused by loneliness, anxiety or isolation. 

Creating new ideas that benefit all

There was general consensus that while COVID-19 is creating shocks to the economic system as well as personal anxiety and potential losses, workplaces may never be the same again and more people will work remotely going forward. For now, the need to collaborate with suppliers, competitors and organisations in different sectors is hugely important. Together we will come up with new, agile and original thinking designs to solve the problems we all face.

UK businesses are creative and resilient and will get through the current crisis, but everyone has a moral duty to help the NHS and charities at the front line. Businesses are already making suddenly underused resources and skills available to those who need them and these conversations are set to continue.

Finally, colleagues at several companies in Hong Kong and China are already returning to work, so there is light at the end of the tunnel. Their experiences will be invaluable as we plan for multi-stage returns for staff to the workplace.

There is no doubt that the situation we all face is changing hour by hour and is incredibly challenging. There is more pressure on individuals, rapidly shifting policy from governments and an uncertain future. Join our forum to share cross-industry perspectives regarding COVID-19 responses, challenges and imperatives.

26 March 2020 Snapshot

  • Establish a crisis team that meets and communicates regularly.
  • Remove all complexity from business planning and focus on the short-term.
  • Ensure the impacts of sudden shocks and shifts in revenue channels on cash flow are understood in detail.
  • Support people through the crisis, trust them to get the job done.
  • Innovate where you can add value to the supply chain, particularly in expanding capacity.

Adapting at speed

The second roundtable identified that organisations able to adapt at speed to rapidly changing market conditions while protecting their staff, customers and shareholders will weather the current COVID-19 crisis most effectively. 

Participants described how they were having to react quickly to big changes in their business models. One deep dive example included switching from supplying fresh food to pubs and restaurants, which are no longer serving customers, to supermarkets, where customers are buying considerably more stock than normal.

Being able to equip contact centre staff effectively to work from home is another example, especially for organisations without access to relevant technology. Some are thinking about how to prepare for the next phase of the crisis, considering new drive-through/contactless channels that will enable customers to click and collect goods without leaving their cars, for example.

Understanding the implications of these big changes is essential, said one CFO. It may be that sales of fresh products in supermarkets are ramping up significantly, but this must always be balanced by the extra costs of paying for the necessary safety and personal protection equipment now required in the supply chain. 

A further example is the purchase of equipment for working or learning from home, which has spiked hugely in the past few weeks. Securing the additional income is good for the balance sheet but makes future planning and modelling hugely difficult. Needing to hire additional short-term employees to plug the gaps left by unwell or self-isolating colleagues is another un-budgeted cost.

Cash is king in a crisis

Being able to understand the impact of shocks to business models and trade throughput - especially on cash flow and cash reserves - is therefore vital to success. Participants felt being honest and open with shareholders on uncertainty in current market conditions would be understood since there are currently too many unknowns on how long the crisis will last.

One way to navigate through the situation is to pare right back on projects by 75% or more, focusing only on the efforts that will improve capacity, service and delivery to customers right now. One CFO said there was nothing wrong with senior leaders being ‘unashamedly short-term in their thinking’. 

The issue of motivating employees, especially when they are working from home for the first time, or being exposed to risky situations, is an ongoing challenge. Leaders need to communicate regularly and clearly, explaining why actions are being taken and how the organisation will respond when things happen suddenly, such as the recent closure of schools and nurseries. Leaders need to allow flexibility and accept that people will get their work done, though they may need to do it differently.

2 April 2020 Snapshot

  • Effective change needs to be detailed, thorough and communicated with employees.
  • Remote working can lead to greater productivity as people find ways to work more efficiently.
  • Sustain regular touch bases with employees and support their mental health while remote working.

Focus on the facts

The third roundtable began with advice from an eminent economist and social media expert who advised the group to stop looking at the headlines and focus instead on the facts. The current pandemic appears to be a classic 90-day cycle with the usual 40-day peak and then begin to drift away, as we are already seeing in countries that experienced COVID-19 first, notably China.

This means we can expect the UK to see a peak in the next week or so, then a gradual de-escalation in cases. It will likely bring big shocks to the UK economy, but industries will bounce back on a first out, first in basis, hopefully with a V-shaped rather than a U- or W-shaped recovery. 

We are applying almost medieval measures such as social distancing and quarantine (derived from the Venetian word for '40 days') to make sure the virus is contained, but these measures will be removed gradually: children are already being allowed to walk in the streets of Rome.

Prioritise the next 30 days

Asked whether businesses are acting proportionately to the opportunity, the panellist responded that every business needs to look ahead to the next 30 days' operations, then look at their cash flow, and this will give them the answer. It's difficult to criticise companies grabbing a lifeline that has been offered by the Government, and every business has to deal with the reality it faces.

Despite all the help on offer, businesses that were already in survival mode will run a higher risk of folding, and unemployment figures will continue to rise. However, we will move through this period of disruption through transition to a new normality in time: the quest for capital growth and human ingenuity will see us through.

Focus on employees: a case study from a construction company

The next panellist, head of a financial shared services centre at a construction company, said that COVID-19 is just another layer of challenge that his industry has faced in recent years. Planning for change needs to be detailed and thorough, and everything that is happening needs to be communicated effectively to employees, some of whom may be facing reductions in pay, asked to work from home, or maintaining social distancing/working different hours on-site.

Leaders of construction companies have a paramount duty to ensure the health and safety of their people, but also to keep their organisations going through the crisis, not least because one-in-12 UK jobs are found in the sector. This extends to ensuring anyone being asked to work at home can practically do so.

Before moving the shared services team to remote working, they checked that everybody was equipped with a table and chair, a way to access broadband and a laptop, and to ensure the right security was in place. It is easy to assume this might be the case, and it is important to check. 

It was also vital to identify any members of the team who may struggle with isolation and anxiety and to ensure the company's existing mental health first aiders were in regular contact with them. After just nine days, some team members were reporting higher levels of productivity up to 14%, partly because people are now making their own decisions instead of consulting 'super users' and finding their' own norm': work patterns that suit them and their families. 

The company is providing team activities and online town halls to keep the company together, and managers ensure they make regular phone calls to check how people are feeling. Senior leaders are benefiting from avoiding long commutes and being able to use the time for calls and virtual meetings with staff and partners. 

Construction companies rely on hundreds of suppliers, so it's also important to keep communicating with them and reassure them that bills will be paid. It's possible that the sector could suffer from not being able to take delivery of particular equipment during the next couple of months, but resources will be dedicated to constructing the buildings and infrastructure that the country needs, including temporary hospitals across the country. 

The Government is supporting the construction sector to use the current downtime to fix the roads, repair schools and other key infrastructure buildings while we are all at home, in preparation for our return.

9 April 2020 Snapshot

  • Don’t be afraid to accelerate decision-making, flexible working, data analytics, information sharing and digitisation initiatives.
  • Provide guidelines for how to operate new technologies safely and effectively, especially for people who are not used to them.
  • Understand that it’s possible to delay risk reporting or employ light touch reporting as long as governance models are followed and any decisions and changes are recorded transparently.
  • With the right adaptability and attitudes, small business can still adapt an innovative in the current market.

Managing operational risk through a crisis

One of the key challenges for organisations currently is how to ensure business-as-usual risks continue to be managed effectively while executive teams are coping with the unexpected impacts of the COVID-19 pandemic.

The first action to take is to establish the facts about what is happening within the organisation and beyond, then use these to gain the confidence of front line managers, said the first panellist in this week’s session, who is the chair of trustees for a large humanitarian and development agency.

The next step is to ensure that conversations take place between managers and staff and that everyone is clear about what they should be doing, and potentially use more data analytics to gain insights into how people are working.

There’s also an opportunity to redeploy people from second and third line positions in risk and audit functions to front line or data analysis roles, ensuring that while reporting can be delayed governance models are still in place and there is an even greater emphasis on care and control.

More guidance may be emerging from regulators about delayed reporting deadlines, but for now it is important to be as open and transparent as possible about actions being taken and why. Decisions and changes made should also be recorded for future reference and accountability.

Taking care of people

Whatever happens over the next few months, people are the most important assets organisations have. It’s difficult for many employees to find their new ways of working especially when juggling childcare with work. Middle managers in particular may find it challenging to lose previously close oversight of teams now operating remotely. However, this also provides an opportunity to adopt more productive ways of working that may well last beyond the current crisis.

As the next panellist, who heads up operational risk for a large UK bank, explained, roles that would normally never have been considered for remote working such as those in contact centres are now being successfully deployed in their thousands.

As well as ensuring services run as close to normal as possible, the bank is making fast decisions and getting new services in place quickly, including the delivery of cash to vulnerable customers as well as dedicated helplines for NHS staff and the over-70s. The difficulty here is introducing widescale change in a period of huge instability and stretched resources.

With hindsight, new initiatives are still being achieved successfully, largely because the bank took early decisions to stop travel and ask people to work from home, which meant employees were already separated from colleagues before lockdown.

Having already invested in a powerful and secure virtual desktop infrastructure (VDI) is a second advantage, and the bank may now consider a different approach to maintaining its current property portfolio - and extending its flexible working policies in future.

There’s no going back

The third panellist, global head of operational resilience at another large bank, agreed there has been a massive shift in work culture. Hundreds of thousands of employees have now been equipped to work from home across the globe, and this has involved negotiations with local government and regulators in different countries so that office equipment can be relocated, even during curfews.

Using video conferencing systems has helped teams at the bank stay in touch, although it has been important to ensure that the right security settings are in place and that people not used to these tools feel comfortable with how to get the most out of them.

Other ways to engage with people include check-in calls to individuals at the beginning and end of the working day. Also, establishing a ‘worry score’ where team members self-score on whether they are feeling more worried than the day before, why that is and what they can do about it together.

The fast-moving crisis means the risk function needs to operate slightly differently, with professionals becoming ‘risk stewards’ who support chief risk officers and document actions taken without acting as a brake on the decisions that need to be made quickly.

One of the outcomes of the crisis is that different parts of the bank have accelerated agile working and information and resource sharing. Three lessons learned are to provide strong guidance around working from home, making it easy for people to do the right thing; create a buddy programme so managers don’t feel they are making decisions in a vacuum; and accept the fact that this situation is likely to go on for a while, so it’s important to continue taking time off when needed. A final tip is to consider creating resilience flashcards that outline best practice for employees working remotely.

Pivoting in the face of adversity

The final panellist described how their business pivoted from making retail point of sale displays to manufacturing protective face screens for NHS trusts, as well as food manufacturers and distributors, within just a couple of weeks.

When orders fell off a cliff in late March, he faced the choice of either making the whole team redundant or finding another business model. Now operating as a not-for-profit organisation, the company has taken on extra staff to meet demand for the protective screens, which will now be manufactured in the tens of thousands.

The experience shows how quickly small companies can adapt to changing market conditions extremely quickly, given the right spirit and commitment. It also shows how scenario planning should include more than just small variables, and that business leaders need to think about the ‘ultimate plan B’ where a whole customer base could disappear overnight.

16 April 2020 Snapshot

  • Be prepared for the future fallout from mental and physical pressure on staff currently operating in battle mode.
  • Take deliberate steps to ensure that productivity gains introduced by using technology differently are not lost when the pandemic eases.
  • Learn from the extraordinary efforts made by people to create change, which are currently outperforming normal hierarchies.

Adapting organisations and processes on the front line

Although the hyper-regulated healthcare sector is not usually known for its adaptability and fast adoption of technology, NHS Trusts, GP practices and pharmacy chains are all now having to make quick decisions about changes they can make to deal with the challenges created by the current pandemic.

Our first panellist, deputy CEO of a large NHS Trust in London, said that like most people his team had watched the pandemic emerge with slightly detached concern, waking up to its potential impact when the virus started taking hold in Italy. Since then, dealing with COVID-19 has moved front and centre of the trust’s operations and the healthcare sector is proving it can be as fleet-footed as everyone else, now it is faced with an existential crisis.

One advantage for healthcare is the fact that its brightest and best professionals are operating on the ‘shop floor’, which means they can see where changes have to be made for the benefit of clinicians and patients.

There are three issues to learn lessons from: how to take control of your supply chain and find creative ways to source equipment, including setting up a 3D printing farm; sustaining innovation beyond the crisis, such as continuing to offer telephone triage and video consultations and doubling critical care facilities; and sustaining a workforce that is under huge physical and mental pressure.

While efforts from the public such as the Thursday applause for the NHS and Captain Tom Moore’s fund-raising walkathon provide huge morale boosts, people are now running on adrenaline. It’s time to look ahead and think about what comes next, including a rational plan for the funding of social care, prisons and schools as well as the NHS itself, and the creation of an operational model that can be more dynamic in future.

GPs and pharmacies under pressure

The COO of a UK NHS commissioning group is leading the COVID-19 effort for GPs, who like all front line staff are suffering from stress and overwork but have adapted quickly to the new conditions. He said that GP practices are collaborating to care for each other’s patients if clinics have to shut down, for example.

GPs are also making much greater use of telephone and video consultations and using remote diagnostic technology – in some cases making more progress in one month than the whole of the previous decade.

There are two concerns about the near future: one that GPs currently operating on a battle footing will succumb to illness once we get back to some kind of normality, the second that non-Coronavirus illnesses and diseases will be missed. However, GP primary care will change for the better as a result of changes being adopted now.

The CFO of a pharmacy chain described the unintended impact that the pandemic is having on finances and staff. The restriction on customers entering pharmacies has reduced footfall, product and service sales, while prescriptions being made by some GPs for 56 or even 84 days mean a charge can be made only once instead of twice or three times, and pharmacies need to order and pay for more medication in advance than normal. Financial help is available for pharmacies, but it’s not always clear when this will be available or which budget it will come from.

Meanwhile life for a CFO has an element of Jekyll and Hyde, managing the extraordinary but also trying to deal with day-to-day activities like budgeting and audits.

Thinking ahead

Finally, one of the UK’s foremost practitioners of performance psychology reiterated the opportunity to learn from the current crisis and make sure technology that enables collaboration and smarter working continues to be used when the crisis recedes.

Leaders can shape a better future by thinking differently, picking up on people’s efforts to do something meaningful and solve problems. Such efforts are currently outperforming hierarchies and bureaucracies and companies could follow this lead to become more agile in future.

New ways of managing people learned through this period of remote working and self-isolation could also be adopted, including checking in with people rather than checking up on them. Flexible work patterns are having to be accommodated when it takes three hours to shop, or children and older relatives need to be cared for. Micromanagement needs to be replaced with trust in people to get their work done.

23 April 2020 Snapshot

  • Keep one eye on making sure the business is still productive and relevant, but spend time reflecting on how to stay meaningful in the future.
  • Galvanise teams behind a common purpose and future that are culturally relevant to them.
  • Be prepared to offer a blended, more flexible workplace to employees and suppliers in future.

High octane change

In a change to the usual format, this week’s session focused on a single speaker, one of the UK’s foremost practitioners of performance psychology, who has worked with many sportspeople and teams as well as large businesses.

He began by saying that the world has always been unpredictable and full of improbable events, but that we are now experiencing ‘change on steroids’. Organisations that can dance on the moving carpet instead of having the rug pulled from under them will be the ones that survive the current pandemic: bad companies are destroyed by crisis; good companies survive them - but great companies become better.

It is not just about what businesses are doing operationally, but how and why they are doing them. The future demands them to do things differently, for different cultural reasons. If a rickety old house blows down, we wouldn’t replace it with another rickety old house, but with something better. Since so many constructs in the world were already broken, now is the time to spend time thinking how to change them for the better.

This will help when businesses re-connect with suppliers and furloughed staff. By being honest and transparent through these difficult times, they can build higher levels of trust that keep partners and employees enthusiastic about coming back to work at, or with, a particular company. Organisations are under intense scrutiny and partners as well as staff will remember how a company behaved during the crisis.

An important part of this will involve celebrating success, no matter how small. Football teams facing relegation can be motivated simply by changing the language: from focusing on what they are trying to avoid doing to focusing on what’s possible to achieve. And so can employees.

COVID-19: An easy training day?

It’s important to remember that no matter how difficult things are because of the current pandemic, it could be seen as an ‘easy training day’ compared to future events if nothing changes, particularly when tackling climate change. Everything is up for grabs, from healthcare to the pharmaceutical industry - and could be reimagined for the good of the planet.

The countries and communities that are doing well so far are working collaboratively with their neighbours and networks, and this will be the case for businesses in the future too. Companies can learn from the crisis and recognise the power of a diverse workforce as well as the wisdom of crowds and innovative thinking. For more on these subjects, look up equity theory, Philip E. Tetlock and James Surowiecki as this week’s homework.

A blended work model

While the shape of work may be changing, it’s unlikely that everyone will want to remain working from home once the lockdown is lifted. The office is normally designed to encourage productivity and provides an equal environment for all, but people have to deal with different circumstances at home and are in any case social beings who value interaction with colleagues.

It’s more likely that businesses will offer blended working arrangements with some remote working, either from home or in local hubs. Sharing workspaces with partners or people working in other industries could even deliver benefits from knowledge sharing and cross-fertilisation of ideas.

Finally, can we expect to see more change to the way organisations are run following the pandemic than after the 2008 financial crash? The fact that so many people are losing their lives, not just their livelihoods, should create the right conditions for the transformation of organisations – not least because people are likely to vote with their feet for businesses and public bodies that have taken the right set of actions during the crisis.

However, resistance to change will be one the biggest challenges organisations face going forward, as US author Upton Sinclair said: “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”

30 April 2020 Snapshot

  • COVID-19 looks to be following a 90-day virus model.
  • Lockdown is unsustainable from an economic point of view, so we will start seeing a phased, sector-by-sector lifting of restrictions in the weeks ahead.
  • Technology and dedicated staff have helped the private healthcare-at-home industry reduce pressure on the NHS despite huge financial challenges.
  • There are encouraging green shoots of recovery in the recruitment sector in APAC and the UK

COVID-19 progress report

Four weeks after his first appearance as a panellist on our forum, an eminent economist and social media expert returned to give an update on the pandemic in the UK, its impact on the economy and what recovery will look like.

His view was that COVID-19 is still following the 90-day pattern of classic viruses where 20% of the population are found to contract the illness, but many are asymptomatic or have natural resistance and/or immunity to a virus.

It is likely that the 20% of the UK population who will be adversely affected by the virus will be reached by the end of May, after which time the virus will run out of victims to infect. He did not predict a second wave of infections, largely because this has not proved to be the case in countries like China and Korea.

The second wave that followed the 1918 flu epidemic coincided with millions of troops and refugees, who had experienced malnutrition, poor living conditions and sub-standard hygiene returning home from overseas, so was not surprising to see in this instance.

Lockdown conditions are unsustainable for the long-term because of the impact they are having on the economy - so we can expect to see a phased lifting of restrictions by the government from 7th May onwards.

The economy has been hit hard by the repercussions of the virus and we have seen between 30% and 80% of businesses shut down, depending on the sector, four million jobs put into furlough and the government borrowing £275 billion. But while GDP will shrink by as much as 6% by the end of 2020, it’s likely to recover quickly in Q1 and Q2 2021.

It will recover sector by sector in line with the lifting of restrictions for industries including construction, auto sales and manufacturing. These will be followed by retail and hospitality, with travel and tourism bringing up the rear, probably not until next year.

The social care sector: highs and lows

The CFOs of two healthcare-at-home groups, one that delivers domiciliary services and one that administers medicine for vital and complex care, spoke about the difficulties of adapting to the conditions created by the pandemic. The biggest challenge has been sourcing personal protection equipment (PPE) for staff, not least because usual supplies were diverted to the NHS.

Both CFOs noted that the costs of hard-to-source PPE have soared as vendors exploit the shortages and the care sector has been forced to find new suppliers overseas. The domiciliary services provider had also seen an impact on cashflow, through having to source agency staff to fill gaps left by absent employees who were ill themselves or self-isolating. Investing in medication when faced with uncertainties in the supply chain has been a further financial challenge, although this is now stabilising.

On the upside, staff at both healthcare groups have stepped up to the plate and continued to provide the services that vulnerable people and patients continue to rely on, especially in a crisis. They have also adopted technology quickly and effectively to manage processes such as recruitment and training, as well as introduce new services like patient chatlines. As a result, they have helped to reduce pressure on the NHS as well as provide services that the NHS temporarily paused, such as oncology treatment.

Recruitment: a barometer of the economy

Finally, leaders of the Robert Half recruitment businesses in APAC and the UK gave a brief overview of demand for skills in their regions. Business changed completely the APAC region at the end of January, just before Chinese New Year, when widespread travel restrictions were put in place. Early intervention in countries like China, South Korea, Australia and New Zealand have reduced the impact of the virus, and it is now business as usual for many firms.

There are green shoots to be found in the UK too, as the number of permanent and interim roles being requested and fulfilled grows month on month. Industries that are seeing the greatest demand for new recruits include education, which is moving quickly to online models; technology, needed for urgent digitisation programmes; financial services; and healthcare.

The next wave of demand will be for professionals who can help organisations reimagine their operations post-pandemic, and this will also be the theme of next week’s forum.

7 May 2020 Snapshot

  • Organisations are considering how to learn lessons from the current crisis to prepare for an uncertain future.
  • Innovation and technology as well as different working patterns will bring transformational change to sectors across the board.
  • Impacts from the crisis will last for longer than the lockdown period as consumer and business confidence rebuilds.

Preparing for the future

This week’s session focused on two industry sectors impacted most severely by COVID-19, airlines and restaurants/food supply. Before the speakers gave their perspectives, the UK leader of Robert Half reported that there are encouraging signs of growth in recruitment, particularly in sectors such as manufacturing, packaging, logistics, biotech, pharmaceutical and online retail.

Recruitment plans that had been put on hold have now been brought back online, and growth in industry activity has increased by as much as 28%, according to commentators. Demand is particularly strong for C-suite appointees and interim specialists in technology and finance & accounting.

Reimagining the airline business

The first speaker, head of audit and risk at a major airline, said that the air transport and engineering industry has been decimated by the pandemic. While engineering teams are being kept busy with ongoing maintenance work on the airline’s grounded fleet of aircraft, passengers are no longer flying unless they are being repatriated.

This has led the airline to change the use of plans to transport international cargoes of perishable goods such as food and medical suppliers, which means removing seats to accommodate pallets of food as well as transporting them in the hold.

The airline is anticipating consumer demand for leisure flights to return before business travel, particularly as corporate organisations consider how best to spend disposable income in the years ahead. Looking forward it will be important to think about how airports as well as aircraft will operate in terms of social distancing, and there will be a greater use of technologies to enable processes such as touchless check-ins, for example.

The second speaker, head of audit and risk at a metasearch engine and travel agency, agreed that it was difficult to predict when the airline business would be fully operational again. If an effective vaccine is produced successfully that would shorten recovery time, but it is likely to take three to five years to return to normality.

In any case, air travel will change significantly and will recover in different regions within varying timeframes. Barriers to entry to the market will fall as airlines start to look at asset disposals, meaning new and different (cash rich) players could move into the sector to expedite ecommerce and delivery schedules.

Consumer confidence will be an important factor, as will calculating how much business and leisure travellers will be willing to pay for extra security and social distancing measures. Finally, collaboration and IP sharing efforts that have already emerged in the industry will continue into the future with businesses supporting each other through the crisis.

A refresh in food

The CEO of a prominent restaurant group explained that the hospitality business will also need to change, in line with health and safety concerns. Staff and guests alike will be worried about when it’s safe to head back to work and eat in busy restaurants, and social distancing measures will be needed in kitchens and out on the floor.

His business is considering how to bring other services into larger restaurants to add to the dining out experience, such as hair and beauty; re-opening restaurants that can offer outside dining; or using technologies like robots to reduce personal interactions.

Investment in new arrangements will be balanced by reducing non-essential central costs: the lockdown provides a useful opportunity to analyse the P&L line by line to see what the essential items for running a restaurant chain actually are.

Such measures will mitigate against the impact of a likely 30% reduction in custom, but without further government help, the restaurant business is likely to be hit particularly hard especially in Q1 2021 when we are likely to see an economic slump. While the restaurant business has shown resilience in the past, as many as 50% of companies could fail as a result of COVID-19.

The challenge for food processors has not been a reduction in demand, but a shift from food outlets to supermarkets, said the group CFO of a leading food supplier. The UK population has largely shifted to eating three meals a day at home and returning to 1970s/1980s patterns of a weekly shop at one supermarket rather than more frequent visits to a variety of stores. Customer orders have changed accordingly, which has meant adapting quickly to the new environment. This will continue as quick service restaurants start to reopen in the coming weeks.

Being ready for an uncertain future is a key concern for Protiviti customers across the board, concluded one its MDs. There is a great deal of discussion about how to return, adapt and innovate, both in terms or new ways of working and creating pandemic resistant organisations for the future. In particular, firms are considering how to manage unpredictable surges in customer demand as the lockdown is slowly rolled back.

14 May 2020 Snapshot

  • COVID-19 has accelerated business transformation projects already underway, and exposed the shortcomings of inflexible legacy communications and IT infrastructures.
  • Organisations that fail to adopt cloud-based collaborative technologies run the risk of users adopting them in any case, introducing potential security problems.
  • Becoming a cloud-first organisation will turn businesses into more attractive targets for M&A activity.

Accelerating business transformation

One of the biggest impacts of the COVID-19 virus has been the need to move people and operations from offices, schools, colleges, and other central sites to work remotely. Organisations that had plans in place to transform their working models have accelerated the adoption of process automation and cloud-based technology, while those with inflexible legacy communications and IT infrastructures have struggled to provide the systems their users and customers need.

In this week’s forum, leaders from three technology firms explained how they have helped both large and small organisations embrace the adoption of cloud and why the pandemic may be the biggest single driver for accelerated business change that we will see in our lifetimes.

Prefacing the discussion by explaining how the recruitment sector is often seen as an indicator of economic health; one of Robert Half’s Managing Directors gave an update on the employment market, particularly executive search. Demand for roles continues to rise across the world, with China and Singapore now back to business-as-usual levels and organisations are recruiting from larger international pools. There is a clear trend for organisations to seek senior executives who can rethink businesses in line with the rapid reshaping of sectors.

Unleashing human potential

The first speaker, centre of excellence leader at a software firm that provides robotic process automation (RPA) technology, said that fear of change is one of the biggest challenges that organisations need to overcome. There is a misconception that robots will replace jobs, whereas in reality they are there to increase human capacity and free up time for more valuable work.

COVID-19 has brought the potential of RPA to the forefront of peoples’ thinking through the very necessity of having to do things differently. Public sector and healthcare organisations, in particular, are not set up to support remote, mobile and home working, but have adopted automation for processes such as payroll and helplines extremely quickly in order to continue supporting customers.

The company has been offering free consultancy and licences to organisations as part of its COVID-19 response, and this has helped to push people over their ‘humps’ to test out digital automation that will provide a way forward for the future - as well as secure trust and buy-in from staff and management.

Empowering people to focus more quickly on what is important 

The General Manager and VP of an international software as a service (SaaS) firm agreed that COVID-19 has accelerated change, and that one of his clients, a pharmaceutical company in the thick of developing a vaccine for the virus, had been able to pack up its operations in just 48 hours. New implementation projects that previously took months are now being rolled out in weeks.

However, he stressed that as well as focusing on accelerated business change it’s important to keep controls in place. Users are demanding the ability to work anytime, anywhere, but this has to be reconciled with the stringent requirements of data privacy regulation – reconciling the two can be tough.

Cloud is key to automation and business success

The third speaker, Chief Information Security Officer (CISO) at a cloud security company, said that many organisations have now moved through a triage stage where they needed to ensure their organisation could continue functioning.

Those with legacy systems have recognised that those systems constrict change, not least because it can take several months to get additional security protocols in place to meet the new needs of a remote workforce. By contrast, there are no such restrictions on cloud-based infrastructures in capacity or scalability, while operational costs and capital expenditure can be reduced significantly.

A further driver for adoption of cloud infrastructure is that users will adopt technologies such as Microsoft Teams themselves, bypassing legacy systems like virtual private networks and potentially creating security risks as a result. Flexible working also needs to be supported, especially as organisations consider when they will re-open office space, if at all.

The speaker’s final point was that there is likely to be a resurgence in merger and acquisition (M&A) activity in the 12-18 months following the pandemic. Organisations that are ‘cloud-first’ in their thinking and strategic intent will be more attractive targets in this scenario, not just because they will have lower IT overheads but also because they will be easier to integrate with acquiring companies with similar infrastructures.

21 May 2020 Snapshot

  • The logistical difficulties of protecting staff returning to offices in particular may push the practice of home working to the end of 2020, or even permanently.
  • Customers will value and remember the social purpose demonstrated by companies during the pandemic.
  • Organisations must seize the opportunity to understand how they circumvented barriers to effect change, and how to continue with innovative strategies moving forward.

The road back to normality?

With the UK government encouraging schools and business to start reopening, organisations are now considering how they can safely bring employees and/or customers back into their premises.

According to one of Robert Half’s Managing Directors, recruitment into new roles has taking an upward trend with temp/interim recruitment and the technology sectors is growing the fastest, suggesting that cautious optimism is returning to businesses.

The executive director of an industry body for the finance industry said that retail and investment banks had achieved momentous results in the early weeks of the pandemic crisis, switching employees to remote working without disrupting customer service.

This has enabled banks to keep branches open and also fulfil their critical role to help stabilise the economy. Work that could never have been visualised as being done from home, notably financial trading, has been successfully managed remotely.

However, banks are now having to carefully consider what steps they can take to bring employees back to work in offices. These steps include how to accommodate staff safely while maintaining social distancing, especially in shared kitchens and meeting rooms; how many staff should return in what time period, given that many processes are working well with remote working; and what mitigants should be put into the workplace, including personal protection equipment (PPE) and potential thermal imaging.

One unforeseen challenge is that employees are being asked not to use public transport and to walk or ride to work, but the government’s guidance is that showers and gyms should yet not be reopened. These issues will make working from home preferable until at least the end of 2020 for many banks.

Slower invoice payments

The second speaker, partner and alliance lead at an international artificial intelligence company that tracks invoice payment trends within its customer base, showed data that demonstrates late payments are on the rise.

Even UK organisations that have automated accounts receivable functions using the company’s platform are now paying 52% of invoices at least 10 days later than their due date, a significant spike compared to the pre-lockdown figure of around 15% - and the worst performance compared with other European countries including Italy and France.

Companies that have missed the chance to automate payment processes will be unequipped to handle invoices efficiently with staff working remotely, with posted invoices piling up in unoccupied offices. Things will get worse as economic conditions worsen: the automation of both accounts receivable and cash collection must move up the board agenda.

The importance of social purpose and innovation

The third speaker, finance director at a large restaurant group, said that keeping staff and customers safe during lockdown has been the priority - and would continue to be so, even as outlets begin to reopen.

Key to employee engagement has been constant communications with staff, including regular updates on where the business is headed, and conversations with government to understand guidance in detail. Social purpose, specifically how companies’ employees are treated through the crisis, will be important for customers returning to restaurants as restrictions are rolled back.

Clear instructions and signage in outlets is also vital to protecting both employees and customers, who will be able to see the protective measures taken in kitchens as well as dining areas and drive-throughs.

While the group has spent a lot of time thinking about the here and now, it’s important to consider where it will be in terms of cashflow and P&L in six to nine months. Digitisation projects are likely to accelerate to improve processes and reduce costs.

This must be a conscious decision for all organisations, concluded Protiviti’s Global Head of Digital. There will be an opportunity for companies to challenge themselves, working out how they moved from where they were and how they circumvented barriers to change. The danger is that companies will drift back to where they were and fail to take advantage of the chance to build an innovation culture.

28 May 2020 Snapshot

  • The concept of a blended work model opens up potential for attracting a wider pool of employees who can work remotely some of the time, as well as cost-reductions in permanent office space.
  • Companies should make the most of this opportunity to reimagine and optimise their future business models, as well as their office requirements.
  • Carefully assess the strategy around who to bring back to the office and when – as this is likely to influence employee satisfaction, motivation and retention.
  • Altered risk profiles and shorter decision-making processes have enabled extraordinary changes to be made, but these new ways of working will not remain in place by accident – companies will need to proactively focus on how to retain them.

Making the right decisions

UK businesses are currently operating in something of a hiatus, which is giving them the opportunity to take stock of all aspects of their organisations including risk profiles, work patterns, resource levels and decision making processes.

The recruitment barometer continues to improve across many industry sectors, according to one of Robert Half’s Managing Directors. Significantly, there is a particularly strong demand for professionals with digital and innovation expertise as well as for senior leaders. Business is almost back to normal in China and Hong Kong, including travel on public transport, while the US and European markets are continuing to recover.

The COO of an insurance business described how the company had successfully moved its largely telephony-based organisation to working from home. As a result the company has been able to serve its customer base effectively right the way through lockdown.

This success has raised questions about why in normal times it takes so long to implement change and new technology, and also why the business continues with non-digital processes such as handling cheques or physical post.

As customers have had no choice but to engage with the company (as well as with their banks and telco providers) using digital channels and payments and used them without any problem, it has become clear that this could be the norm for the future. Online training, which was used successfully during lockdown is another process that could remain in place.

Such changes have been made possible because of shorter decision making cycles and a different approach to risk – the company has moved from monthly meetings and set pieces of activity to a faster pace of making things happen.

The next question will be how to bring hundreds of staff back into the office. Consultations with staff had revealed that around 15% would like to return quickly and 15% would like to remain working from home, while 70% preferred a hybrid model.

A hybrid model will make sense for some firms - and could even provide more flexible resources that can be matched with customer demand patterns, while enabling the company to recruit from a wider geographical recruitment pool.

Jumping off the hamster wheel

The Chairman of an insurance courtesy car business said that COVID-19 had a major impact on the company, which involved battening down the cost base and putting staff on furlough. But it also provided an opportunity to jump off the hamster wheel of day to day work and think about what the company could look like when it re-emerges from hibernation.

It’s difficult in normal times to break away from usual working practices, but the interruption to business meant that the board could work through scenario planning and an analysis of workstreams to understand profitability and cashflow in more detail. It is unlikely that we will have another chance like this, so companies should make the most of the opportunity to reimagine and optimise their future business models.

However, it is important to take employees into account when introducing any prospective change, especially as they have faced such high levels of uncertainty and stress. Staff must be re-engaged with the company when they return, especially if there are new plans in place.

Accelerated change

The third speaker, a non executive director at a large insurance firm, agreed that the adoption of automation and digitisation by companies has been accelerated through necessity. The use of new distribution and communication channels have leapt faster in a few months than they had in four or five years previously, and been adopted & embraced by older demographic groups that had previously been less willing to use it.

He said that decision making processes had accelerated too, but that they had also been simplified. Instead of trying to do too much at once, leadership teams had focused on achieving one thing at a time.

While this and the move to remote working by UK staff had been successful, companies had experienced problems from overseas outsourcing companies struggling to keep their operations running. This could prompt a rethink on the use of offshore outsourcing firms in the future, as part of general move to bring provision of critical activities nearer to the end-user, and possibly in-house.

Finally, he said that how and when firms ask employees to return to the office will be implicit indicators of those companies’ cultures and values: when assessing who to bring back, will companies prioritise the wishes and needs of the individual, or instead focus on the efficiency and effectiveness of business activities?

Overall, the speakers concluded that a blended work model is likely to prevail, with decisions yet to be made about where office space would be based, how much of it would be needed as social distancing and self-isolation rules prevail, how to manage more complex and flexible work patterns for hundreds of people and how to maintain a positive and inclusive corporate culture. The decision will be based on what individual companies see as being the role of the office. 

One last point was that regulation which impedes digital innovation has been shown not to work in the scenario insurance businesses and their customers have found themselves in, so reforms would be welcomed for outmoded processes such as ‘wet’ signatures.

Risk appetite will also need to change, said Protiviti’s Global Head of Digital. A digital leader will understand the strategy of a business and the risk/regulatory framework in which it operates – and then find innovative ways to achieve objectives. Just as cyber security professionals had to move from saying ‘no’ to suggesting ‘how’, so will risk professionals need to change their response.

Robert Half Executive Search specialises in the search for and placement of executive leadership talent across a broad spectrum of function areas and industry sectors. Contact the Executive Search team today to learn more.

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