I have the opportunity to see patterns emerge among companies in diverse industries. Sometimes, those patterns emerge slowly, becoming more apparent as I gain perspective through experience. There are, on occasion, patterns that become immediately obvious.
In early March, I sent several text messages to my clients. This was to find out about our (I always refer to my clients as “us”, “we”, or “our”) level of preparation for what seemed like a rapidly-brewing storm: COVID-19.
As a business coach, I help my clients implement the Scaling Up and 3HAG frameworks in their business. I have a very good idea about their ability to cope with any kind of hardship. My inquiry was more about mental and process preparation. How does our business continuity plan look in case of an interruption? How do we handle working from home in the event of a quarantine? Do we have the cash flow runway that we need?
My clients were falling into two camps. There were those who accepted that COVID-19 had the potential to impact their business, and those who didn’t.
Reluctant leaders were having trouble. Their personal feelings about COVID-19, its potential impact, and the world’s reaction to it, were rapidly becoming irrelevant. Society as we know it is on the verge of a partial or complete shutdown. This can affect your life, your team’s lives, and your company. You have to make a plan right now to ensure your company can survive and thrive beyond whatever happens next. You cannot ignore the brutal facts.
The Stockdale Paradox
What are the brutal facts, you ask? This is a concept from Jim Collins, popularized in his seminal business book, Good to Great. It originated from something Collins termed “The Stockdale Paradox”. This was named after the late Admiral and former Vice Presidential candidate James Stockdale, who endured six years of captivity as a POW in Vietnam.
Stockdale had no idea when he would be released and was randomly tortured. Despite this incredible hardship, he maintained an absolute belief that he would prevail. This paradoxical ability to persevere with faith while acknowledging reality is the same characteristic found in leaders who are moving forward in the face of the COVID-19 situation. They are maintaining their positivity and passion while having a clear view of the potential opportunities and struggles ahead.
In contrast, Stockdale claimed that POWs who were overly optimistic and unwilling to face their situation fared far worse. Business leaders who cannot come to terms with their current reality – or come to this realization too late – may also struggle.
My friend and client, Deb Gabor, reminded me of the Stockdale Paradox three weeks ago. This helped me prepare an exercise for her team that allowed her to identify the brutal facts affecting her business. The same exercise also helped her spot growth opportunities, even in the face of challenging odds. I used this same exercise with other leaders, and the same result followed: Leaders found hope and opportunities because they realized how they could be essential to their core customer during this time.
Tools to Help with Your Core Purpose and the Brutal Facts
Here is a simple, downloadable tool that will help you define or refine your company’s core purpose/why. It will also give you a way to evaluate the brutal facts one at a time, make plans to address each of them, and turn these plans into an actionable set of priorities you can tackle now. Finally, it will help you set up a daily huddle for your company to keep information flowing quickly. Here are the instructions for each section:
Define/Refine Your Core Purpose: Get very clear on the reason why your company exists. The common answer to this is “to make money”, but it will benefit you greatly to identify your higher purpose. This was the passionate reason you started your business and speaks to the greater good you do in the world.
Having a defined core purpose in place is critical because it gives you the clarity and focus you need to make critical decisions facing your company. This north star acts as a compass for your business, giving you the ability to deal with ALL forms of adversity, not just the current crisis.
This may resemble your mission statement. Sure enough, a great core purpose can sometimes be pulled out of a mission statement. But, it is much more actionable and usable than a paragraph-long mission statement. It contains 5-9 words that adequately describe your “why”. For examples of core purpose, see the list on page six of this great document from Jim Collins.
To get a first draft of your core purpose in place, work by yourself or with your leadership team to answer a few simple questions. First, ask what is it that your company does. Write down your answer. Once you’ve answered that, ask why this is important. Write down your answer. Then, ask why this matters. Write down your answer. Repeat this pattern until your answer sounds too much like your organization is saving the world. Back up one step to the last written answer. This is usually your core purpose.
Assess the Brutal Facts & Form a Plan of Attack: Understandably, many who are struggling to accept their current reality won’t be reading this post. Right now, many companies are on the verge of collapse because they won’t adapt to an unprecedented situation. To understand everything that is at stake, we must deal with the brutal facts at hand:
List the positive and negative brutal facts facing your business. This can sometimes be an emotional challenge, but work with your leadership team to make a list of the brutal facts. FACTS ONLY, no conjecture! “We don’t have access to any customer decision makers for two weeks”, or “we have 8 weeks before we run out of cash”, are examples of brutal facts. Note: the facts are not always negative. Be sure to list the positive facts, as well. You will probably have a finished list of 8-10 facts.
Decide on a plan of attack for each fact. After you make the list, review each fact and determine and discuss options to attack each one. If there is nothing you can do, move on to the next fact. Don’t stop until you’ve discussed every fact you listed. A couple of interesting things start to happen during this exercise: You’ll likely find a couple of opportunities you haven’t considered, and one plan of attack may be the solution for multiple facts on your list.
Focus on plans that make you indispensable. Identify the plans that make you indispensable to your ideal/core customer. The ideal or core customer is an archetype that describes the customer for your brand that is most predictive of your success.
Make a List of Rank Ordered Priorities. Using the list of plans you just developed, decide which become priorities that you have to accomplish immediately. Under normal circumstances, we have an annual plan and quarterly plan we are executing against.The situation with COVID-19 is so unique that it may have understandably changed that plan.
Determine the proper length of time you need to accomplish these priorities. You may have to revisit them weekly, every two weeks, monthly, etc. Keep focused on this finite list (5 or less) of critical company priorities to accomplish in the time frame you’ve identified.
Increase Your Meeting Cadence: If your company has a daily huddle, you may have to consider increasing it to twice daily. Whether your team is working from home or you are simply in crisis mode, you’ll need to increase your frequency of communication to stay on top of priorities and the rapidly-changing situation. Make sure all your departments are participating in a daily huddle.
The huddle is a proven way to increase the flow of communication in your company. This can give you a real advantage when, like the last couple of weeks, fast information is at a premium. For more information about the benefits of the daily huddle, and how to roll one out, this article by Verne Harnish contains the answers. Also, you can download the daily huddle agenda below for more information.