Coronavirus: Dealing with a Black Swan – Part 2

The Coronavirus is the Black Swan that is now affecting all aspects of life. And, unfortunately, it keeps bringing unanticipated aftershocks. However, fortunately, we are not entirely powerless. Now is the time to plan for the additional, company-specific Black Swan effects, the aftershocks that may happen, and your ultimate recovery. You will have to think differently about the immediate future.

Think differently:

One way to think differently and start protecting yourself against the aftershocks of this Black Swan (Black Cygnets, if you will) that follow, is to work through this exercise: 

• have your team identify a minimum of ten events, or series of events, that would severely impact your business to the point of irrelevancy or failure; 

  • Note: a minimum of ten events is required; the more, the better. The ten-event minimum will force the identification of events that typically would not be considered in the ordinary course of business.

• Include all events no matter how outlandish they may seem; 

• Your next Black Swan aftershocks will be on your list in the eight, nine, or ten spots (start from the bottom and work your way).

Now is the time to act: 

• Identify the actions that must be taken immediately for each Black Cygnet, and take them; 

• Identify for each Black Cygnet the "inflection point" that identifies possible future action 

  • Note: an “inflection point” is evidence, in the environ in which you work, that the next Black Cygnet event is coming to fruition, but has not yet happened;

• establish a process to actively and aggressively search for the "inflection point." 

• For each Black Cygnet identify which actions can be postponed until an "inflection point" is reached; 

• Assign a specific team member(s) to search, on a regular and periodic basis, for each particular "inflection point;” 

• Assign a specific team member(s) to initiate immediate action once the "inflection" point is reached.

The identification of “inflection points” provides an early warning signal that a negative impact on your business is imminently possible but not necessarily probable. This process provides a mechanism that lessens the possibility of taking drastic action should the Black Cygnet event fail to materialize.

Further, using the same process described above identify those “inflection points” that indicate that the current crisis is approaching its conclusion for your organization. Now is the time to plan to initiate the recovery of your operation. This crisis will pass, and you need to be ready to take advantage of the recovery at the earliest possible moment.

So, right now, the coronavirus crisis continues to unfold. Every day is filled with uncertainty. Minimize that uncertainty by planning now for both continuous negative impact and the ultimate recovery. Think and act differently now to minimize possible risks and optimize potential opportunities.

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Check out Part 1 of this series by clicking here

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About the Author

Dr. Michael Petty is the co-founder and consulting-futurist at Flagship Futures Group, LLC in Washington, DC. He brings over forty-five years of strategic and financial experience to the service of his clients. His most significant value to his clients lies in his expertise in the areas of strategic thinking, planning and execution; shareholder value creation; and leadership development.

Learn more about Dr. Petty here, or get in contact with him here.

Coronavirus: Dealing with a Black Swan – Part 1

If you’ve never stared a “Black Swan” in the face, you are now! A Black Swan is an event that happens unexpectedly, has significant, even devastating consequences, and is then rationalize. The current Coronavirus is a Black Swan.

Our world has changed, dramatically for some, in a matter of a few short weeks. Most of us are scrambling to safeguard both our families and the businesses we steward. Most of us will be unscathed health-wise, but most will experience an impact on our companies. Some of us are somewhat prepared to weather this Black Swan, many of us are not.

You may question how can we possibly prepare for a Black Swan like a Coronavirus, that originated in a country thousands of miles away, in a "wet market" (whatever that is), and from a culture that eats exotic animals? The answer to that question is: we have to think and plan differently!

You might question how we can think differently about a Black Swan such as this? 

One way to think differently and start protecting yourself against the next Black Swan, and the aftershocks that follow, is to work through this exercise: 

• have your team identify a minimum of ten events, or series of events, that would severely impact your business to the point of irrelevancy or failure;

• a minimum of ten events is required; the more, the better;

• any and all events should be included no matter how outlandish they may seem;

• your next Black Swan or aftershocks will be on your list in the eight, nine, or ten spots (start from the bottom and work your way).

• challenge each event and identify the action that must be taken immediately, or in the very near future.

You may question that no one would ever think of the Coronavirus in this exercise. Well, that may be true. But you might include the disruption of your Chinese supply chain; the shortage of a significant device component, like test kits; or the curtailment or cancellation of a substantial contract for a local or national sporting event, like the NCAA National Championship Basketball Tournaments. If done with diligence and creativity you will identify the more specific Black Swan you may be experiencing now or in the near future.

There will be continuous shock waves emanating from this Black Swan over the next several months. Now is the time to identify those potential impacts, assess the implications, and plan for them as best you can. The exercise above will help you.

This type of exercise should preferably be done as part of your regular strategic thinking process, for once you’ve identified your Black Swan you can prepare for it. And, by definition, it is no longer a Black Swan because if and when it happens it is not unexpected, and, because you've planned for it the impact will be minimized or avoided altogether.

Now is the time to plan for your next Black Swan, and there will be a next one.

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Check out Part 2 of this series by clicking here

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About the Author

Dr. Michael Petty is the co-founder and consulting-futurist at Flagship Futures Group, LLC in Washington, DC. He brings over forty-five years of strategic and financial experience to the service of his clients. His most significant value to his clients lies in his expertise in the areas of strategic thinking, planning and execution; shareholder value creation; and leadership development.

Learn more about Dr. Petty here, or get in contact with him here.

The Business of Business is Planning

If you don’t get this right a lot of things will happen and none of it is good! Planning, in my view, must be strategic, deliberate, premeditate, calculated, considered, and intentional. We are admonished to do everything decently and in order.

My question to you is, “How do you know what direction to take unless you plan it out?”

If there was one I believe that these people, among others, would be included in the “Planning Hall Of Fame”; those that planned strategically as they sought to carry out God’s vision for them:

1] Jethro, Moses father-in-law, mentored Moses to appoint officials over the people of Israel and had them serve as rulers to judge over the people. [Exodus 18: 17-27]. I view Jethro as history’s first organization development consultant.

2] King David knew his role in the planning for and staging of the resources needed for the building of the temple and left everything needed for Solomon to complete the building of the temple.

3] Nehemiah made careful preparation and plans for the rebuilding of the Wall around Jerusalem.

4] The apostle Paul developed a strategic missionary strategy of proclaiming the gospel and establishing churches in centers of commerce from which believers could take the gospel to outlying villages.

5] Jesus Himself was a planner. Reading the gospels I get the clear sense that Jesus operated intentionally. He was clear about His identity, His mission, and deliberately went to places like Caesarea Philippi just to ask the disciples, “Who do you say that I am”. He could have had that conversation anywhere but he intentionally traveled a long way to just to ask that question; “Why”, is the subject of another blog.

Additionally as the time approached for Jesus to complete His mission, he moved intentionally toward Jerusalem in order to complete His Father’s mission for Him. He knew His plan and was able to declare, “It is finished”.

Jesus gave the disciples a vision, provision and a plan to reach the world when He told them, “But you shall receive power when the Holy Spirit has come upon you; and you shall be witnesses to Me in Jerusalem, and in all Judea and Samaria, and to the end of the earth.”

Throughout biblical history Godly people have been planners and strategic about it. Prayerful and thoughtful analysis and preparation are the keys in designing for success in the work of God.

Questions that support the need for planning include:

• “Who are we?”, is about mission and purpose

• “Where are we?”, is about analysis

• “Where are we going?”, is about vision

• “How are we going to get there?”, is about planning

• “How are we going to pay for it?”, is about cash flow generation and management

• “How are we doing?”, is about implementation and measurement and Course correction

The purpose of planning, which is the Business of Business, is to ultimately create a set of priorities that enable a CEO to act courageously and responsibly today in order to advance toward a God given future vision and legacy with an ever greater expression of God’s power in the marketplace. It is an intentional systematic effort to seek the inspiration and guidance of the Holy Spirit in order to discern the will of God as we move into the future.

If a designated leader isn’t planning how can that person really be a leader? My experience as a business leader is that there is no substitute for good planning and preparation leading to efficient and effective implementation.

King Solomon wrote, “Where there is no revelation, the people cast off restraint”. Jesus says, “My people perish for lack of vision”.

Here is a question for you to ask of yourself, “What area of my life and business do I need to be more strategic about?”   God wants to reveal to us not only what we are to do but give us the energy, will and determination to do it strategically, faithfully, and persistently.

“Four steps to achievement: Plan purposefully, prepare prayerfully, proceed positively, pursue persistently.”   William Arthur Ward, inspirational writer

Here I am Lord send me!

THE STEWARDSHIP OF TALENT MANAGEMENT

THE ANNUAL PEOPLE PLAN: A LEADERSHIP TOOL Talent Management: Why? Because it focuses on the most important asset – people – and can be the single most impactful factor for organizations in achieving their goals. Leadership must be able to develop its people to successfully achieve its goals.

Growing and successful organizations spend some leadership and management time on strategic planning: where they want to go, and how they plan to get there. They also spend a significant amount of time on their annual operating plan (AOP) or budget: how much will we need; where will we get it; how will we expend it. But few spend an equivalent amount of time on planning the best ways to manage and utilize their talent – even given that it is their talent that will be the key management factor to achieving the strategic objectives. My premise is that organizational leadership should emphasize an Annual People Plan (APP) as a necessary and equal adjunct to the AOP and to the business objectives.

Successful organization leadership practices stewardship: it is a biblical standard (I Cor. 4:2 ). That stewardship should also be evident in the managing of the organization’s talent: it is often the largest single expenditure in the annual financial plan and merits that level of attention. It is also true that talent can be the catalyst to maximize the leverage of other resources and plans most effectively and efficiently. Today’s workforce is asking of prospective employers, ‘what will you do to help me grow and develop professionally?’ It is an awesome responsibility to be encouraging and coaching employees to develop to their God – given potential. It requires leadership and support at the senior executive level. Leadership’s single most important responsibility may be ‘who do we let in the front door?’ The hiring process is key because the talent we hire will be the tipping factor in how well the organization achieves it goals. In addition, when we employ someone we as an organization have the responsibility for the professional – and related personal – growth and development of that person. It is ineffective to hire and then not to develop and nurture talent.

Performance management is already practiced by many organizations; it is, however, not talent management, though there is overlap. In the former we focus on job performance compared to job expectations over the past year; in the latter we look forward to identify the talent needed to achieve the organization’s goals and then build a plan to be certain we have that talent available and that we develop its potential.

The initial construction and implementation of an APP requires significant thought, work and energy. For most organizations it will be a major cultural change because its focus is new. Dealing with employee talent in a significant and new manner may be uncomfortable for many managers.

First, senior executive and human resource personnel must be the champions of the APP. They must believe in and be committed to the stewardship activity, participate in it and hold participants accountable for implementation and follow through. Depending on the size of the organization the APP may be led by only the CEO or by the CEO and one or two other executive managers. (Note that the CEO, too, must be a participant in the APP as it relates to his/her responsibilities and direct reports. In fact, because of the direct link between talent management and succession planning the board of directors – who are responsible for the CEO portion of any succession plan – should be strong encouragers of any talent management initiative).

The APP will have its best contribution to an organization’s growth and success if it becomes an integral part of the organization’s culture and DNA. That means continued support from senior executive management - the first 2 or 3 years are critical. It means integrity and involvement towards everyone touched by the process. It means using the APP results and plans whenever a new talent placement is considered. It should mean involvement by the board of the organization to assure proper talent at the senior level.

Many organizations recite the phrase, ‘our employees are our most important asset’; many do not know how to maximize the talent resident in those employees. The introduction of an Annual People Plan will be a significant beginning to grow the talent for the organization’s goals and to contribute to the personal and professional career growth of those employees.

All organizations want – need – leadership talent in place to face well the shifts in the world’s mission fields so that the mission effort can move forth successfully.