In the first of what we expect to be dozens if not hundreds of papers, articles and ultimately books on leading during the extraordinary recession, McKinsey and Co published Leading Through Uncertainty in their McKinsey Quarterly (free registration required).
Sparing you their pre-amble defining the current condition (but surely review their interesting scenario analysis), key excerpts include:
Executives need a way of operating that’s suited to the most
uncertain business environment since the 1930s. They need greater
flexibility to create strategic and tactical options they can use
defensively and offensively as conditions change. They need a sharper
awareness of their own and their competitors’ positions ...
Sounds like something right out of Sun Tzu's Art of War, which, according to AWhere's CEO John Corbett, is almost entirely about location and the knowledge of the location of assets -- yours and your enemy's -- and the terrain in between.
Companies must now take a more flexible approach to planning: each of
them should develop several coherent, multipronged strategic-action
plans, not just one. Every plan should embrace all of the functions,
business units, and geographies of a company and show how it can make
the most of a specific economic environment ...
A company’s 10 to 20 top managers, for
example, might have weekly or even daily “all hands on deck” meetings
to exchange information and make fast operational decisions ...
What new
products best fit different scenarios? If one or more major competitors
should falter, how will the company react? In which markets can it gain
share? ... Unless executives evaluate their options
early on, they could later find themselves moving with too little
information or preparation and therefore make faulty decisions, delay
action, or forgo options altogether. AWhere's ability to correlate discrete and differently formatted data sets across time and geography gives way to the ability to see information in new contexts. Patterns appear, a lack of information becomes readily apparent, and changes in near-real-time competitive sales performance, macro- and micro-economic indicators (including zip-code level default trends of holders of credit-cards and mortgages, as one example), and allow business leaders to compete on analytics, as the Harvard Business Review suggests.
Better business intelligence promotes faster, more effective decision
making as well. Companies can often gain insights into the potential
moves of competitors by weighing news reports about their activities,
stock analyst reports, and private information gathered by talking to
customers and suppliers. Such intelligence is always important; in a
crisis it can make the difference between missing opportunities to buy
distressed assets and leaping in to snare them.
To get this kind of business intelligence, companies need a network,
typically led by someone with strong support from the top. This
executive’s mandate should include creating “eyes and ears” across
businesses and geographies in particular areas of focus (such as the
competition’s response to the crisis), as well as gathering and
exchanging information...
Assembling bits of information, facts, and anecdotes helps companies to
make sense of what’s happening in an industry. Say, for example, that a
supplier says it has no difficulties with funding, though first-hand
knowledge from other sources indicates that the company is struggling
to meet its payroll. Such warnings can allow executives to get a full
picture much more quickly than they could by sitting in their offices
and interacting only with direct subordinates. This is a brilliant assessment of how to address a crisis, but the question remains: within the network, how is all that data going to be quickly qualified, compared and presented? If the people doing the networking have added a "competitive intel" line item to an already full daily agenda, where are the resources being identified to turn all this information into understanding? Just as we demonstrate with the United Nations Foundations' strategy to optimize collective intelligence through AWhere InSite, using geo-analytics to increase the facility of assessment within this signficant new and non-uniform data flow may provide the "glue" necessary to give each independent part the most meaning.
In fact, many functional areas offer big opportunities: greater
effectiveness, lower fixed costs, freed-up capital, and reduced risk.
This could be the moment to redefine and reprioritize the use of IT to
increase its impact and cut its cost. We couldn't agree more. We have been building implementations of these types of systems throughout the second half of 2008, and have watched our customers eyes light up when the see the correlations of data that was formerly hidden in silo'd spreadsheets. Care to join them?
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