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As restrictions gradually ease, many Australians are optimistic about the "next normal" including returning to the office. For leaders, it's important to balance optimism with pessimism when planning for the next phase.
1. Market feedback
Intelligence about the impact of COVID-19 on specific financial services sectors, not published by media.
A. “Have you returned to the office yet?”
This is a regular question in our conversations with you, and in your conversations with others. It seems many Australians are positive about the near-term outlook, and that you’re also eager to return to normal working conditions. This was inconceivable just a month or two ago.
And some businesses are rushing for the entry, at least in their thinking, as they think through their transition back to the office.
As we mentioned in a previous note, CEOs are also starting to see that the transition back to the office will be more difficult than the transition out, riddled as it is with challenges for employers and employees. Many corporate towers are imposing strict rules on lift capacity in order to keep infection down, and inside the office social distancing must also apply.
As one legal professional put it, mitigating the risks of biological hazards is just going to become a regular and normal cost of doing business. However, his medical colleague pointed out that these are real, not just hypothetical risks. While there’s the physical risk of the virus (staying safe) there are also complex psychosocial ramifications (feeling safe).
B. Legal and risk practitioners
From what we hear, legal practitioners are seeing a spike of over 40% in workers’ compensation claims. They’re expecting claims to grow exponentially as businesses reopen and as workers return to work.
One OH&S expert and workplace physician made the comment that although the 1.5 metre social distance rule is broadly understood in theory, in practice it’s difficult to police and make work. This is thanks in part to differences in workplace configurations and the sorts of work we do. Factors for employers to consider include enforcement of distancing, personal behaviours that cause risk to yourself or others, and accusations of safety breaches. Be prepared – we’re warned things could get nasty culturally if the policies, processes, communication and troubleshooting are not managed well.
Medical and legal advice combined is this: businesses need to be ready for biological hazard management, ideally with those steps above plus a formal written due diligence exercise showing measures taken. This is particularly important for directors who shoulder responsibility for their team’s safety. Those who aren’t compliant with the Safe Work Australia guidelines are at great risk of being issued an improvement notice by regulators, being temporarily closed down after a workplace inspection or worse, causing cases among their people.
Like any hazard, a clear methodology for risk mitigation is needed for COVID-19. However, COVID-19 is unlike ‘normal’ hazards that are usually contained on-site, as it can be brought to and from the workplace, making risk mitigation more complex.
C. Fund managers
With an alphabet soup of recovery scenarios being touted for some time, it seems no single letter adequately describes the way all markets will recover. There's not much talk now of a “V”, still some “U”s albeit with a flat bottom, a lot more staggered step-up “W” mentions… and the entry of an “L”. If you miss "J", maybe take comfort we’ve not yet heard of any “M”s.
Fund managers continue to see inexperienced investors come into the market. Similarly, brokerage firms are reporting three times higher retail account openings compared with the prior corresponding period (year on year).
Some managers continue to see attractiveness in IT, hardware, online retail, gaming and biotech while shunning energy, commercial real estate and financials due to reduced energy demand and consumer credit risk, and uncertainty about how we work in the future. Many are more “jury is out” for now.
2. Management responses
This section outlines how CEOs and their leadership teams are responding.
A. Digital
For companies to come back stronger than before, management and senior executives need to focus on the things that matter most. Workforce is an obvious one, so too is digital. You’re seeing that digital – whether called out as such or just part of how you work - is one of the most important capabilities you have, or have to develop. You’re integrating digital analytics and stepped up capability into products and /or services which you’re increasingly delivering online to streamline and optimise operations... or evolve the whole business model and service proposition.
This whole thing rapidly killed some ways you worked in ‘the real world’. While some of you yearn for that to be back, and are actively seeking to go back to where we were physically, every single leader we’ve spoken to cites increased digital / virtual or online ability as a) desirable b) here to stay c) not quite the same as being in the same room.
So much of what we hear from you in terms of desired future state use of digital is driven by both personal and professional considerations. Those of you who want to get back to the office don’t love the work from home world. Those of you who never want to go back do love the work from home world. Both camps can justify their position on both rational and emotional grounds. Our sense is that as more move back to offices that will become a self-perpetuating thing… more will beget more. But that also there will be – you tell us – some norms that are probably now finally smashed. We hear far greater acceptance of a future that includes primarily working from home, not living within commuting distance of a CBD, and virtual meetings as a dominant format.
Remember when email started people? And there was all that complaining about emailing the person at the desk next to you or on the same floor? Seems like we’re weeks ago from Zooming colleagues who sit at least 1.5 metres away.
B. Agility: the next normal
As a firm, we immediately jumped into crisis mode when we saw the severity of COVID-19 and the damage it was going to inflict on our clients and the broader economy.
This is second nature for most public relations and crisis communications professionals. It’s been a bigger adjustment for others, but for the most part you moved with speed, flexibility and great positivity. Greater operational agility in the ‘next normal’ will be crucial for long-term survival and success. You’re talking now about long term changes to rhythm, routine, planning and daily operations.
3. CEO guidance regarding coronavirus responses
This section provides our guidance on management and communication responses.
1. Ideal future state: best, worst & base cases and the plans to get there
This disruption is being used by some of you to disrupt even more, evolve, or pivot; whether because you must, to survive, or because you see it as part of thriving in the next normal. If that planning and action hasn’t been governed by good planning, now’s the time to look at these things:
i) Ideal future state, goals, stakeholder outcomes that remain, change or are new
There are risks, new opportunities and positive experiences out of all this. How those feature of our planning landscape coalesce now is worth considering before resuming “next normal”. It’s worth mapping outcomes that you can control and that are not merely an outworking of the environment – or a change in ‘state’ (say the resumption of economic activity) versus a directly created outcome. How can you tell the difference?
Consider mapping three types of target outcomes for PR, marketing and communication or other programs, using the Casey rubric (used as a build on “theory of change” and relevant now): impact, influence and leverage
1. The impact of your work is its program outcomes
2. Your influence is how much other actors change as a result of your work
3. Your leverage is how much investment others put into your model
You can target, change and measure each of these outcomes through actions or programs of actions. By contrast, more revenue (arguably a change in ‘state’ but often hard to prove as purely a PR & marketing outcome) might just mean the economy is recovering.
ii) Best, worst & base case scenarios for revenue, stakeholder behaviour and economic conditions
- Current state : the reality now and in the next financial year looking forward – balance optimism with realism, that we may not be “out of this by Christmas”. See this warm and wise Jim Collins video on the Stockdale Paradox for more.
- Scenarios that seem right to you: for most that will mean one that’s a wipe out, one that’s at least half as bad again as any impact so far and one that’s a slow step-wise recovery from here
- Project forward what each of those three scenarios will mean for your revenue, costs, cash and balance sheet, and your clients and stakeholders
iii) Pathways to reach the goals in (i) above for each of the scenarios in (ii)
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Revisit and review, before resuming, planned PR, marketing and communication action
- Challenge assumptions that underpinned your previous PR, marketing and management strategies, plans and actions, asking yourself three questions: Are they still right? Will they be in the next normal? Were they ever right?
2. Preparing for the next normal: positioning and profiling (PR) differently
As we shift our attention to the next normal and begin planning to return to the office, CEOs and senior management need to be thinking about what they want their company to stand for, what change they want to make and see in the business and what impact they want their business to have on the broader community – and this need not be for altruistic reasons alone.
As the economy re-opens, we will find that consumer behaviours, sentiment and priorities will have changed. So will demand. Businesses should be thinking about how to position for this.
4. Appendix: How to help us help you
This briefing is collective intelligence gathered, anonymised and shared with you by my firm for the greater good. We’ve taken the view, based on client feedback, that the collective benefit to you all takes precedence over normal competitive pressures at a time like this.
This is an excerpt from one of our client COVID-19 CEO response briefings. For more COVID-19 response resources and guidance, visit our COVID-19 Response page.
If you’d like to discuss adjusting your communication strategy for the current times, please call us or fill out our contact form here.
