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The Post-COVID Playbook: Shockproof Your Supply Chain — Now

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The Post-COVID Playbook: Shockproof Your Supply Chain — Now

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There’s more turmoil ahead, but artificial intelligence and machine learning will cut through the noise for faster solutions.

Around the world, supply chains are in the spotlight like never before. When COVID-19 struck, chaos often ensued, much of it supply chain related. Governments weren’t able to source essential medical supplies, and shoppers were left staring helplessly at empty shelves.

In 2020, countless businesses discovered they were reliant on one another in ways they had never realized. Globalization has left all of us interconnected through supply chains too complex for traditional methodologies – annual surveys and manual checklists – to manage.

Even after the pandemic subsides, there will be severe and lasting economic turmoil that will require companies to continually scrutinize their global supply chains. At the same time, it’s very likely that COVID-19 will not be the last shock of this decade, but one of many. In the 2020s, global supply chains will have to contend with everything from climate change and natural disasters, to the rise of protectionism and the threats posed by cyberwarfare and security breaches.

In recognition of the growing importance of supply chain resilience, U.S. President Joe Biden has issued an executive order to launch a 100-day review of supply chains critical to national security, public health, public safety and job creation. This is an important step toward ensuring operational resilience for both the public and private sectors, but there is more work to be done.

The sole supply chain question used to be: “Are we as cost-efficient as we can be?” Now it is: “Where in the world should I be doing business and with whom?” And, if something adverse is happening: “Where else should I be doing business so that I have some agility and operational resilience?”

Yet help is at hand: artificial intelligence (AI) and machine learning (ML) can enable companies to better understand their supply chains in weeks, rather than months or years. Often these technologies expose a matrix of previously unknown vulnerabilities. By combining the right capabilities with insight and experience, you can shockproof your supply chain now and survive the challenges ahead.

Global supply chains in the time of coronavirus

In early 2020, as the deadly virus was quietly spreading in China, the first sign that international business operations were about to take a hit came in mid-February, when Apple announced it would miss its quarterly revenue target of $63 billion–$67 billion. As China took steps to contain the virus, affecting Apple’s supply chain, the company’s stock fell 11.7 percent.  Clearly when Wuhan shut down, there were ripple effects—and some affected companies were unaware of their dependency on China until that moment.

We are still feeling the ripple effects of those early COVID-driven supply chain shocks today. Early COVID outbreaks redirected consumer demand for silicon chips from automakers to consumer electronics. Now that demand has started to swing back, automakers have found themselves in the midst of a silicon shortage, with research firm IHS Markit estimating that 672,000 fewer vehicles will be produced in Q1 2021 as a result.

Businesses that relied on spreadsheets and manual checking systems to track their cross-border supply chain relationships struggled to assess their exposure to the knock-on effects of the virus. Few companies had the necessary technologies in place or knew where to get them.

Before COVID, most companies knew who their prime suppliers were and had some knowledge of their suppliers’ suppliers. But supply chains in the age of optimization are vastly more complex. With globalization have come third- and fourth-tier linkages and beyond, spanning to hundreds and thousands of intricate and complex connections that extend all over the world. The loss of a single component low down the chain can create disruption and prolonged chaos at the top.

This is how the closing of a factory in China leads to a sudden shortage of iPhones, which may be manufactured in another country, and how the fragility of the global supply chain—unnoticed for a quarter of a century—was exposed for all to see.

Looking back a few decades, the intricate interconnectedness of cross-border supply chains became systemic in the 1990s. Offshoring was a new global trend and “just-in-time” methods pioneered by Japan were adopted worldwide. As supply chains straddled more and more borders, business leaders should have been asking: “Who are we doing business with, where are we doing it, what resources are we ultimately reliant upon, and what does that mean for me and my business?”

Now’s the time to learn some lessons from the pandemic. To ensure the continuity of their operations, businesses need to make themselves aware of—and understand how to respond to—the potential shocks to come. As threats evolve and change, constant vigilance is required.

For most multinational companies, discerning supply chain risks can be as perplexing as staring at a Monet painting close up. But AI and ML can help them focus: these technologies can resolve the patterns in the many millions of dots—the intimate connections between companies in a complex supply chain. However, you still need human insight to interpret the patterns and understand how to adapt. In the uncertain years ahead, with the help of AI and business intelligence, it’s possible to turn these threats into opportunities and gain an edge on competitors

Future-proofing: a how-to guide

Supply chain threats are manifold and, as COVID has taught us, can cut deeper than anyone anticipated. Here are some of the larger global risk themes to consider for future-proofing:

Second and third waves. To date, COVID-19 has claimed over 2 million lives worldwide, caused severe economic damage, and made it harder to transport goods across borders. Many countries are now experiencing second and third waves of the virus, potentially causing a resurgence of global supply chain problems. Businesses need to put emergency planning in place now.

Natural disasters and national emergencies. COVID-19 is the latest in a series of unforeseen shocks. The global financial crisis of 2008 caused havoc in the markets, the 2010 volcanic ash cloud in Iceland grounded air travel worldwide, and the Tōhoku earthquake and tsunami of 2011 caused disruption to businesses reliant on Japan. Last year, companies linked to Lebanon were affected by the explosion in Beirut and in Australia by the devastating bushfires. The list goes on.

Climate change. Rapid melting of ice caps, rising sea levels, and prolonged periods of drought may make some areas uninhabitable, prompting the movement of peoples and affecting production in industries such as food, fisheries, and agriculture.

Even before COVID-19, some governments were starting to view their reliance on China as an issue, particularly in the context of the US-China trade wars. The U.S. had vowed to bring production “back home” and introduced legislation to ban 5G technology company Huawei, affecting at least a dozen industries, including aerospace, technology, and auto manufacturing—all of which count the federal government as a customer. The new U.S. defense law encompasses all global subsidiaries and service providers deep within a firm’s supply chain.

Environmental, social, and corporate governance (ESG). Companies are being held accountable for the actions of their far-flung suppliers, of which they are often unaware. Businesses need to ensure suppliers at all levels of their supply chain align with their own values and commitments.

Cyberattacks and data theft. In the Internet age, many supply chains are digital, but this doesn’t make them any more resistant to sudden shocks. Cybercrimes such as hacking and phishing are at least as prolific now as before the pandemic, possibly more so because the attention on them has been redirected elsewhere. The global financial industry, for example, relies on thousands of card-based applications that require different access controls and are the constant target of cyberattack. It’s practically impossible to track such vulnerabilities without incorporating AI and ML into a comprehensive risk management strategy.

Managing concentration risk

An overly concentrated supply chain — one reliant on a handful of suppliers or many suppliers located in the same geographic area – exposes a business to risk. All manner of events can take place without warning, with almost overnight repercussions.

Even if you seemingly have no relationship to a particular area, your second- and third-tier connections might. The only way to track and trace potential sources of problems—and start building resilience toward them—is to make concentration risk a key part of your strategic thinking.

In some industries, such as technology, there’s now so much specialization that a supply chain could be sourcing hundreds of thousands of components produced in hundreds of different places – or even more precariously, in just a few locations. An incident in a far-flung corner of the globe you know little about could have major implications for your profit forecasts.

To determine where the potential problems are and address them, having AI capability is paramount—followed by skillful, nuanced, and complex analysis of the data. This process can help identify alternative sources of supply and begin to develop a strategic roadmap with a view to achieving uninterrupted operational resilience.

Protecting your brand and reputation

The consequences of failing to analyze, stave off, or sidestep concentration risks are hard to overstate. The short-term risks are immediately evident: customers won’t be able to buy products they need because interruptions in the supply chain mean businesses can’t produce, supply, or sell them. Long-term, there could be grave consequences for the brand and reputation.

This is why maintaining a robust supply chain must remain a top priority post-COVID for any company with a strategic mindset. The pandemic has clearly demonstrated the importance of understanding where your weaknesses lie, preparing contingency plans, and preventing supply chain breakdown. A situation that develops overnight can leave a CEO on the hook with shareholders and stakeholders the next morning, unless a plan is already in place for immediate deployment.

Now is the time to start investing in advanced technological capabilities—to uncover potential risks, to formulate the most effective coping strategies and to optimally position your company for new opportunities with competitive advantage. It’s a sort of high-tech sleuthing exercise. That said, we live in an age of unprecedented technological advancement. Human wisdom must be brought to bear in order to understand what needs to change—and that starts with a dynamic and proactive leadership mentality. “No man ever steps in the same river twice, for it’s not the same river and he’s not the same man,” wrote the Greek philosopher Heraclitus. Exactly the same can be said of businesses and their extended supply chains.

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Ryan Elliott is a Partner at Kearney, a leading global management consulting partnership in more than 40 countries.

Jennifer Bisceglie is the CEO of Interos, the first and only business relationship intelligence platform to protect enterprise ecosystems from financial, operations, governance, geographic, and cyber risk in every tier of enterprise supply chains, continuously.

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How To Measure The Effectiveness Of Changes In The Office

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In order to solve problems at work, you often have to make policy changes. Unfortunately, a policy change doesn’t always work out how you hoped it would.

Below are some suggestions for measuring the effectiveness of a policy change and what to do once you’ve determined whether it’s working or not.

Ask Two Simple Questions

There are two, simple questions you should ask yourself when trying to determine whether or not a policy change is effective.

The first question is, “Are we still noticing the problem?” At some point, someone saw there was a problem with the way work was being done. There was either a bottleneck in someone’s workflow, mistakes were frequently being made, or something else was happening that caused problems. Eventually, someone noticed, brought up the problem, and worked on a solution.

The question is, are you still seeing that problem or has it gone away? It’s possible that the problem has been reduced, but isn’t totally gone yet. That may require some simple tweaking instead of a complete policy overhaul. But either way, you should be able to get a quick idea for how effective the policy change was by simply looking at the task that inspired the change in the first place.

The second question is, “Has our solution caused other problems?” Just because you solved one problem doesn’t mean you didn’t accidentally create another problem. What problems are people having with the policy? How hard are those problems to deal with? Are they bigger or smaller than the problems you were trying to solve?

Digging through your work processes and talking to involved team members about these topics will help you figure out if the solution is better or worse than the cure.

Take Advantage Of Employee Surveys And Interviews

One-on-one interviews and employee surveys are good ways to encourage your employees to tell you what is slowing them down at work and what parts of their workflows need help. Be sure to emphasize that the company is looking for problems to fix in order to make everyone’s life at work easier.

Otherwise, they may be afraid to speak up in case they look like they’re complaining.

Approach the questions in such a way to get them to talk about the new policy. Ask them what is working, what isn’t working, and what problems they’re still seeing.

Take this feedback into consideration when you’re trying to determine whether you should keep, alter, or remove a policy.

Ask Managers About What Problems They’re Seeing

Managers generally have a higher-level view of what’s going on with their team. Be sure to lean on them for information that you’d otherwise miss if you focused on talking to people who may not always understand what their coworkers are doing.

Managers are probably best able to answer your questions about who’s affected positively by a given policy, who’s affected negatively, and what they think could be done to solve any other problems that have popped up.

When You Get Your Results, Take Action

Once you’ve analyzed everyone’s feedback and you’ve looked at the related KPIs and whether they have improved or declined, it’s time to act. Acting might mean scrapping the policy entirely, optimizing it to make it better solve the problem, or it may mean enhancing an already successful policy to make it even better.

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Katie Casaday is a marketing content writer at eFileCabinet where she specializes in computer software and document management topics. She graduated from Utah State University with a BA in Global Communication. She has experience writing about B2B technology companies and besides enjoying writing, she loves nature and taking hikes with her companion, a Border Collie named Margo.

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Winning The Future: What Businesses Must Do To Prepare For 2021

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Businesses bolted into 2020 with firm plans and optimistic outlooks.

All that evaporated by mid-March as the focus turned from thriving to surviving for most companies. Now, as this turbulent year enters its final months, a new question lies just over the horizon.

What will 2021 bring and how can businesses be ready?

“The future still seems so uncertain and the end of the pandemic still feels a long way off, but despite that there is a lot businesses can do to prepare for success in 2021,” says Adam Witty, a successful entrepreneur and the ForbesBooks co-author of Authority Marketing: Your Blueprint to Build Thought Leadership That Grows Business, Attracts Opportunity, and Makes Competition Irrelevant.

“I’m sure 2021 will come with its own unexpected twists and turns, but I am also confident there will be potential.”

All the unknowns make planning a challenge, but Witty says it’s possible to begin gathering hints about how the world will operate going forward.

“You just have to know where to look,” says Witty, who also is the founder and CEO of Advantage|ForbesBooks (www.advantagefamily.com).

He suggests business leaders should:

Review what you learned in 2020. Think about what you did this year to maneuver through the hazards that came your way, Witty says. What worked? What didn’t? What would you do differently? “Use what you’ve learned to get your ducks in order to manage your business in a manner that meets both your and your customers’ needs,” Witty says. “Then, ask yourself what the future may hold and how you would handle whatever comes up.”

Talk to your best customers. Find out what they want and need, and how they anticipate their lives – or businesses – will look in 2021, especially post-pandemic. “Learn how your product or service will fit into the flow,” Witty says. “Do they want you to continue delivering your product line in some virtual way, or is it important for them to be able to come into your facility for a real sit-down to discuss what they need and view the options in person? Does your solution lie in providing the best of both worlds, offering virtual visits alongside opportunities for physical interaction? Or is the right option something you haven’t yet explored?”

 

 

Look at what your competitors are doing. Review how they are reaching customers and clients today – and whether you can glean any insights about what they may do tomorrow, Witty says.

Rethink how to use your marketing dollars. In-person events, such as speaking engagements, trade shows, or conferences where you could network with potential customers were put on hold because of the pandemic. They might not return all that soon in 2021, so Witty suggests exploring other options for getting the best use out of the dollars that would have been budgeted for those events. That might mean pitching the media more to land radio or TV interviews or publishing a book that tells your personal or company story and can be given to current or potential clients.

“Can your business handle the unexpected if something you couldn’t possibly anticipate were to arise, as happened in 2020?” Witty asks. “If the answer is yes, chances are you’re ready to play in a post-pandemic world.”

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Adam Witty, co-author with Rusty Shelton of Authority Marketing: Your Blueprint to Build Thought Leadership That Grows Business, Attracts Opportunity, and Makes Competition Irrelevant, is the CEO of Advantage |ForbesBooks (www.advantagefamily.com). Witty started Advantage in 2005 in a spare bedroom of his home. The company helps busy professionals become the authority in their field through publishing and marketing. In 2016, Advantage launched a partnership with Forbes to create ForbesBooks, a business book publisher for top business leaders. Witty is the author of seven books, and is also a sought-after speaker, teacher and consultant on marketing and business growth techniques for entrepreneurs and authors. He has been featured in The Wall Street Journal, Investors Business Daily and USA Today, and has appeared on ABC and Fox.

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5 Reasons you Need a Crisis to Drive Transformation

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There’s a saying that a crisis is a terrible thing to waste. What it actually represents is an opportunity–and the space–for change that normally isn’t available. Here are some of the key hurdles that usually stand in the way of change:

1. Change is uncomfortable

More to the point, the status quo is comfortable. We all take comfort in our routines, whether it’s a particular procedure for closing the books, taking comfort in a familiar organizational structure and close colleagues, or simply repeating the same stretches and workout routine every morning. Breaking out of that comfort zone is both difficult and not always seen as providing worthwhile rewards.

2. Incentives aren’t aligned

Every department and partner is driven by different objectives or KPIs. Revenue teams want to hire ahead of predicted growth, while finance wants to see proof, first. Companies with complementary capabilities to yours want to explore building the adjacent capabilities you deliver, rather than investing in partnerships. Suppliers and buyers are more invested in building long-term relationships and goodwill than in making sure every payment and collection is right on time. Without aligned incentives, finding a way to work together toward new and positive outcomes becomes arduous.

3. Stay in your lane

Teams tend to stay in their own swim lanes to avoid change. The tax department will keep to themselves, as will the invoice processing team. They have little need to talk to each other. If they need to align processes or computer systems, for example, they work methodically through that alignment, raising every possible objection and potential hurdle. The goal is to ensure the solution is correct, of course. But wading through the red tape of heavy opposition also serves to minimize change.

4. Competing incremental initiatives

In prosperous times, there are many attractive opportunities for an organization to invest in growth. From management’s point of view, focus is difficult to maintain and it becomes too easy to spread capital and management attention too broadly. Because there are many “easy wins,” more incremental, yet proven, ideas tend to fill up the investment budget.

5. If it ain’t broke don’t fix it

Persuading others to make changes is harder when the economic sea is calm and fortunate winds fill your sails. By definition, a crisis breaks things, and the fixes required can provide the impetus for changes that would be seen as too radical under normal circumstances.

Since you read this far, I’ve got two bonus reasons that you need a crisis to drive change:

6. A lack of momentum and energy

Those of you who remember chemistry class might recall that a chemical reaction requires energy to start, even if it releases energy overall in the course of the reaction (if no energy was needed, the reaction would have happened already).

A very similar logic exists for making major changes in a business. Although the outcome on the other side of the change might be a better situation compared to the status quo, it’s hard to get past the energy required to make a change.

7. The process doesn’t allow for change

Think about procurement processes, for example. For many large organizations, purchasing anything requires a request for quote (RFQ) from at least three pre-qualified vendors and a formal tender process. It’s a very prolonged, and actually quite inefficient, exercise.

What many enterprises often don’t realize is the ease with which adapting to a crisis can turn a seemingly untenable situation into an opportunity to thrive.

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Uri Kogan is VP of Product Marketing at AppZen, the world’s leading AI platform for modern finance teams

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5 Tips To Focus Your Company’s Transformation As COVID Forces Change

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While the recession caused by COVID-19 has wreaked havoc on businesses of all sizes and industries, some are finding new ways to run daily operations, reach customers, re-shape their business, and stay relevant.

But others are still trying to figure out how to transform, and an expert in the field says that launching a transformation begins with setting the right scope.

“Over the years, I have seen an ill-defined program scope cause serious problems,” says Edwin Bosso (www.myrtlegroup.com), founder and CEO of Myrtle Consulting Group and the ForbesBooks author of 6,000 Dreams: The Leader’s Guide To A Successful Business Transformation Journey.

“For example, the scope may drift from the originally defined target. The scope is the description of the transformation’s area of focus, and in most cases, the scope is defined as a combination of categories. Examples are functional – sales, logistics, production, operations – and organizational – leadership, technology, processes, management systems. It’s most important that the scope is defined to address the challenges at hand and avoid distractions or wasted resources.”

Bosso has five tips for companies to set the right scope for their transformation:

Articulate the problem. Which problem are you trying to solve? Bosso says that question is at the heart of a company transformation. “Defining the specific problem may take numerous discussions and disagreements,” Bosso says. “The human brain has a natural tendency to drift. Blurry lines sometimes separate root causes and symptoms. This step is generally completed with a well-crafted statement of the problem that the organization is setting up to solve.”

List the ways. “When properly conducted,” Bosso says, “this step helps in visualizing the solution. Listing possible solutions is a way of testing the definition of the problem. This step calls for honest questions and thorough analysis to identify the solution options.”

Identify the means. “This is the stage where you test the capabilities of the organization against solution options by identifying necessary means,” Bosso says. “It comes down to understanding internal means, or levers that would need to be pulled to solve the problem. Potential means available might include people, office space, computer systems, or technical expertise in sales, R&D, inventory management and procurement. The process allows organizations to match the correct means to solutions.”

Capture the enablers. Examples of enablers key to the transformation process are those in program management and data science. “Enablers cannot operate on their own to make something happen,” Bosso says. “They are, however, necessary or simply useful for that same thing to happen. For example, change management cannot improve the performance of the sales organization without some level of sales expertise. Once enablers are defined, it is important to capture the various ways in which each enabler supports the transformation program.”

Explore synergies and interdependencies. This step focuses on understanding the overlaps, synergy opportunities, and constraints caused by ongoing initiatives. “Start with a list of all current initiatives that the organization is running,” Bosso says. “The finance department is typically a good source for the information. Meetings should be held with each team, and it’s important to understand that each may be protective of its objective, ways, and means. This could set up turf battles and heated discussions, so explicitly setting the objective of the meetings to understand synergies can help alleviate disagreements and fears.”

“Undergoing a major transformation is really the best hope for struggling businesses to survive in these difficult times,” Bosso says. “There is no time to waste. There are no resources to waste. To get your transformation on target, setting the right scope is critical from the outset.”

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Edwin Bosso, the ForbesBooks author of 6,000 Dreams: The Leader’s Guide To A Successful Business Transformation Journey, is the founder/CEO of Myrtle Consulting Group (www.myrtlegroup.com). Bosso specializes in operations improvement and change management, and his project history includes work for major brands such as Heineken, Texas Petrochemicals, T-Mobile, Anheuser-Busch, Rohm and Haas, Campbells Soup Company, Kellogg’s and Morton Salt. A wide range of assignments have taken him throughout Asia, Europe, and North America. He completed his undergraduate education at The Hague Polytechnic in the Netherlands and earned an MBA from Rice University in Houston.

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Team Leadership Behavior in a Post Coronavirus World

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Human behavior throughout history tells us that when groups of people are suppressed or living in fear, they avoid making decisions dampening progress, and ingenuity. One only must look at our darkest time in history, such as the Black Plague, where one-quarter of the population of London died between 1665 and 1666. Isaac Newton may have thrived isolated away from Trinity College during his “Year of Wonder”, but group societal progress and development did not.

The human reasoning for this, which applied in the 1600s and now COVID-19 times, is instability and fear of the unknown. During these challenging times as leaders, it may seem more natural to “hunker down” and avoid making tough decisions. During a crisis in an effort not to upset others or lose status in the eyes of their followers, leaders tend to concoct sophisticated justifications for putting off difficult decisions, and the delay often does far more damage than whatever fallout they were trying to avoid.

Business leaders must understand that in fact, hard decisions often get more complicated when they are deferred especially during a crisis. The need for rapid decision making is critical, understanding that most decisions can be reversed, but nothing can be worse than an idea or a decision never put forward during a crisis.

The most significant consequences occur when a leader misses an opportunity to help his team build resilience in the face of a tough challenge. Instead of learning to rally together to find creative solutions, they feel demoralized, confused, and even scared by their leader’s deceit.

The consequence of this common rationalization is people learn the wrong lesson to avoid mistakes at all costs and that “looking right” during a crisis is more important than “doing right.” Further, if leaders end up backing themselves into a corner with fewer options sub-optimal decisions may be made. Too often in crisis leaders will continue to ask for more data or analysis (Analysis Paralysis) instead of taking the risk and making the best decision possible with limited data which can save an entire organization during these challenging times. Postponing decisions to wait for more information might make sense during business as usual. But when the environment is uncertain—and defined by urgency and imperfect information—waiting to decide is a decision in itself. As Bruce T Blythe, CEO of Crisis Management International wrote: Crisis decision making is located somewhere between analysis and intuition.

Amid uncertainty generated by a crisis, leaders often feel an urge to limit authority to those at the top, with a small team making the big decisions while huddled behind closed doors. They should reject the hierarchical model that they might be more comfortable within normal times and instead involve more people, encourage different views and debate fostering creativity and risk-taking. This approach can lead to smarter decisions without sacrificing speed. Some small choices that leaders make in the short run could loom exceptionally large over the long term as the crisis unfolds. They can be hard to spot, but leaders must look for them.

In the normal course of business, many “big-bet” decisions are obvious when there is a large cost or major impact, such as acquiring a company, marketing a product in a new geography, or shutting down a factory, with these decisions. But some decisions that seem small or routine at first can have large long-term strategic implications. In an example related to coronavirus, Netflix has gone to lower-resolution streaming in some locations to ease the data load on information networks. While most people won’t notice the difference in quality, the decision could mean that the internet doesn’t crash, which would be a big problem when so many are working from home and children are relying on the internet to do their schoolwork.

When choosing leaders to rise above the rest of the pack during these challenging times, identify colleagues  who have done as many of the three following things as possible to increase the likelihood of them being successful in the current times of uncertainty:

-Lived through a crisis (personal or professional) and shown their mental and personal resilience. For Multinational organizations, many of these leaders may be outside the US leading their markets in Asia, Eastern Europe, Latin America, and The Middle East.

-Made tough, unpopular decisions because it was the right thing to do, even though they took heat for it and potentially burned bridges or spent social capital.

-Expert in: Straight Talk – Willingly able to give bad news up the chain of command to leaders who didn’t want to hear it.

Unprecedented crises demand unprecedented actions. Lessons from past crises suggest that leaders are more likely to underreact. What is necessary is to take bold and rapid actions that would feel too risky in normal times. I.e.: Being rewarded for Daring to Try.

As an executive during a crisis how difficult decisions are made in your truly define an organization’s decision-making culture over time. Whatever temporary pain you might incur from making a tough call should pale in comparison to the precedent set that it’s important to take chances, make quick decisions, and put the organization’s success first.

At the operational or emergency response level it is true that life and death decisions will be taken, the decision is binary and those who made the decision will know very quickly whether the decision is successful or not. Sometimes it is those who go against training and procedures that survive and the ones who do what they are told and stick to procedures suffer. But the trickiest are those we call “big bets”—unfamiliar, high-stakes decisions. When you have a crisis of uncertainty such as the COVID-19 pandemic, which arrived at overwhelming speed and enormous scale, organizations face a potentially paralyzing volume of these big-bet decisions.

Make smart decisions quickly to guide their organizations through this crisis. Embrace them and continue to learn as you go. As one business leader, I spoke with recently told me when I asked how he was doing with his business: “Our company reinvented itself three times this week alone. We will continue this path until we find what works. With the Chaos comes opportunity!”

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By Frank Orlowski, Founder and President Ation Advisory Group| frank@ationadvisory.com | New York, NY USA

If you have any questions or would like help in the area of Compliance and Controls please do not hesitate to contact Frank at frank@ationadvisory.com or visit my website at www.ationadvisory.com. Ation Advisory Group has expert financial and operational experience in development, manufacturing, distribution, and sales spanning 55 countries and, six continents, delivering individualized, proven methods to build out and implement highly successful and sustainable country-specific goals.  All executed with 100% FCPA (Foreign Corrupt Practices Act) compliance.

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Team Leadership in the COVID-19 World

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In 1933, when FDR delivered his first inaugural address, U.S. unemployment stood at 25%, and 7,000 banks had folded in three years. Even as he cautioned his fellow Americans that “the only thing we have to fear is fear itself,” he also conceded that “only a foolish optimist can deny the dark realities of the moment.” The realities of that moment still appear at this instant to be grimmer than those of the current one. Yet with a staggering 26 Million American filing for unemployment over the last five weeks, it’s challenging to dismiss projections of jobless rates reaching or even eclipsing the Depression-era peak that confronted FDR on that very first day of his presidency.

Today’s Americans may not emerge from the coronavirus siege embracing anything approaching the extreme of those directly impacted by the Great Depression, and no reduction in federal responsibilities in the current situation is likely to take the country back to pre-New Deal mode. However, it would be unwise to assume that the severe jolt to our sense of physical as well as material well-being inflicted by this crisis will leave no mark on our human behaviors going forward.

Obvious ones that may never return include handshaking (a tradition long gone in Japan), full-service toll booths, buffets, and sadly free samples at Costco. However, as we dig deeper into the business world, there are less obvious ones that can transition into new ways of doing business. This article seeks to highlight letting go of the past and what to look for in the new COVID-19 World.

We have often heard two widely accepted quotes that seem to contradict each other. The first describes a stonecutter who strikes the rock 100 times with no result. However, on the 101st blow, he sees the rock split. In short, it was not the 101st blow alone that split the stone, but the 100 that went before reinforcing the message of persistence and “staying the course.”

However, the second quote is that the definition of insanity is continuing to do the same thing again and again and expecting different results. The message here is if what you are doing is not working, change what you are doing.

In this COVID-19 World, the question the entrepreneur faces is when to persist and when to change course. The answer depends on the circumstances. To be successful in business in today’s world or any other endeavor, you must be willing to persist when times are tough.

Like the stonecutter, you must be willing to continue working hard through patches where there are no visible results. At the same time, success also requires that you be ready to change course when the current path is not getting you where you want to go, especially during a pandemic. Pivoting now and reinventing yourself may help you thrive later.

Depending on the type of business, we see shifts and pivots in commercialization strategies to help organizations recapture, maintain, and ultimately grow revenue. Obvious ones include storefronts to Direct to Consumer or “you come to us” vs. “we come to you,” adding guaranteed supply of hard to get essentials into unique offerings. Less visible but impactful pivots for CFOs include choosing profitability overgrowth. Government Subsidies, forgivable loans, and grants are the preferred option during these times vs. dilutive funding, and traditional bank business loans or lines of credit.

Looking inside and redefining, your organization should include using this crisis to define a new mission. Instead of ducking from the crisis, refine your company, and embrace it. Externally getting to know your clients better and looking at your client’s challenges from an outside perspective is essential. From a business development standpoint, look ahead at tomorrow’s needs. Ask the question: “What’s my unique selling proposition, and what should it be?” This will allow your organization to pivot and redefine itself appropriately.

Most importantly, believe in your business! See the light at the end of the tunnel. The changes you make to your business model will eventually add to the bottom line and improve profitability. When you believe your business can make it now, you will be a stronger, more resilient, less vulnerable company for the future.

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By Frank Orlowski, Founder and President Ation Advisory Group| frank@ationadvisory.com | New York, NY USA

change
Archives, Global Trade Daily, Special Reports

5 Reasons Company Leaders Resist Needed Change – Even During This Crisis

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The thought of change can be scary, even more so during the type of crisis we’re experiencing now with the COVID-19 pandemic. Although there are business leaders who are already implementing change in response to the challenging economic and operational landscape, many others are not.

“Sometimes the writing is on the wall and organizations are triggered to change,” says Edwin Bosso, Founder and CEO of Myrtle Consulting Group and the ForbesBooks author of 6,000 Dreams: The Leader’s Guide To A Successful Business Transformation Journey. “In fact, members of the organization often are keenly aware that something needs to be done. However, despite that, management does not act, and the cost of inertia can be high.”

According to Bosso, there are five reasons why leaders resist change and, as a consequence, struggle to move their company forward:

They confuse important versus urgent. Leaders sometimes confuse the terms important and urgent. “Important issues are those that do not necessarily have an explicit deadline, like urgent issues, but can effectively have some impact, large or small, on a business,” Bosso says. “The confusion sets in when owners and managers spend too much time putting out fires rather than planning. For example, the company may know that it is important to upgrade its operations. But it doesn’t become urgent until later on when the company looks at the output of its competitors that have completed transformation projects and have become a lot more cost-competitive.”

They lack courage/leadership abilities. Successfully initiating and executing a change process involves numerous leadership skills. “It can be intimidating taking on such a challenge that, to some leaders, may seem like moving a mountain,” Bosso says. “Others are better prepared to take risks, confront reality, envision a better way, make plans, and then act on those plans to lead a change.”

They misalign the incentives. The incentive to change or transform organizations can be misaligned with the incentives of people who are in charge of leading those transformations. “Misalignment of personal incentives can cause us not to act, even when we know it’s the best thing for the company,” Bosso says. “When we are in line for a promotion and higher pay, we certainly don’t want to take on risks that can potentially work against us.”

They lack support and/or resources. Not being afforded the requisite tools or the consensus for necessary transformation can leave a leader feeling powerless. “This is a set of obstacles that many leaders run into,” Bosso says. “The powerlessness can come from the lack of company means, organizational backing, human capital and resources to support the cost of a transformation. After a while, they run out of energy, or time, to make the case.”

They lack a method. It’s not uncommon for leaders to know the difference between where their company is and where it could be, but they don’t know how to proceed. “In such situations, leaders often freeze up and put off the impending need to change, or they approach it through trial and error,” Bosso says. “Having a methodology is beneficial when taking on such an effort. Some leaders take the time and effort to learn what needs to be done, while others bring in experienced people to provide a method for leading a smooth and successful transformation.”

According to Bosso, leaders must understand that there will never be a perfect time for change, but also that often the right change only happens if they force the issue.

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Edwin Bosso, the ForbesBooks author of 6,000 Dreams: The Leader’s Guide To A Successful Business Transformation Journey, is the founder/CEO of Myrtle Consulting Group (www.myrtlegroup.com). Bosso specializes in operations improvement and change management, and his project history includes work for major brands such as Heineken, Texas Petrochemicals, T-Mobile, Anheuser-Busch, Rohm and Haas, Campbells Soup Company, Kellogg’s and Morton Salt. A wide range of assignments has taken him throughout Asia, Europe, and North America. He completed his undergraduate education at The Hague Polytechnic in the Netherlands and earned an MBA from Rice University in Houston.

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3pls, Archives, Global Logistics, Global Trade Daily

Predictions, Prophets, and Restarting Your Manufacturing Business Amid COVID-19

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COVID-19 has created a drastic effect on global health and the economy. Every nation is struggling to deal with the challenge of keeping its residents protected against coronavirus. Businesses are witnessing huge financial losses owing to a reduced/lack of workforce and other resources. If we talk about the manufacturing industry, it also has been hit hard by the corona crisis, and the fact that it has a huge role to play amidst coronavirus lockdown, this impact is felt the most by everyone.

The global supply chain got disrupted because of coronavirus, and since it originated in China, which is considered as the biggest manufacturing market globally, the ability of the manufacturing industry to meet the needs of the customers came down significantly.

So, let us throw some light on the impact of coronavirus on the manufacturing industry, and figure out some effective ways that can help manufacturers restart their business proficiently.

The Prophets and Prediction

The Prophet: The problem with prophecies is that they are based on data that is just a few weeks old, which is not sufficient for business leaders to make hard, cold business decisions when it comes to coming back in the market.

The Prediction: With social distancing becoming a norm, most of the people look forward to buying online. This clearly means that the scope of eCommerce is on the rise, and manufacturers will be looking to make a shift gradually.

Restarting Your Manufacturing Business

Every business is looking to return to the market, but due to the measures that are being adopted to reduce or prevent coronavirus are affecting the supply chains directly, which, in turn, is leading to disruptions in the manufacturing operations worldwide.

If we talk about the manufacturing industries like automobiles where production is done on a massive scale, the schedules for production are rigid and efficiency-optimized. In a similar way, the working of supply chains is dependent on schedules that are fixed like months ago based on the demand projections. Still, automobile owners are looking forward to remodeling such systems to be able to meet the irregular demand atmosphere.

Every crisis consists of several challenges, but one should look for opportunities within them. So, keeping the new norms of personal protection and social distancing, businesses need to redesign their business models.

To help businesses get started again, we are providing some guidelines that will help them to:

-Evaluate the organization’s COVID-19 safety compliance and requirements.

-Restructure the workplace for personal safety and protection.

-Implement procedures for personal protection.

-Put into practice the action plan for restarting to ensure a secure future of the company.

As per a Deutsche Bank analysis, the growth of GDP on the global level will be lower in 2020 due to the coronavirus effects. This effect will leave its impact on most of the U.S. and Europe, with growth forecasts on the global front also likely to drop by 0.2 percent.

Taking Care of the Workforce

The manufacturing industry is dependent on its workforce, and most of them proceeded towards their hometown owing to the fear of contracting coronavirus. In order to get its workforce back, a manufacturing company must keep track of the health status of every worker, along with gaining knowledge on the happenings in their areas through digital mediums. This will help them in knowing from which parts of the country they can call back their workforce to restart the manufacturing processes.

However, at this point in time, most of the manufacturers have to wait, and even if they are able to start the operations with a minimal workforce, they will be unable to manage their other important processes like accounting. In such cases, opting for Outsourcing manufacturing accounting services becomes imperative.

Securing Supply and Inventory

Instant delivery and globalization have turned out to be huge risk areas. Suppliers, including sub-suppliers, are all going through a similar situation. During such crisis situations, a huge concern comes to the top since procurement teams are unable to have close contact with their manufacturing suppliers. This, in turn, restricts them from monitoring the capacity of the production on a weekly/daily basis or evaluating the latest logistics prices and routes.

Now, with COVID-19, supply and inventory are in a position where there is a high risk of contractual defaults and severe legal action concerning the inability to fulfill orders on time or otherwise.

Why do Manufacturers Need to Rethink their Restart Strategies?

Most of the manufacturers are ready with their restart strategies and looking forward to implementing them ASAP. These new strategies are primarily focused on:

-The use of digitalization to receive data and have a superior visualization of the supply chain with control-centric solutions.

-Automation and robots to enhance the flexibility of the plant, including the capacity to run significant processes remotely or alone.

There is no denying that manufacturers are moving in the right direction, but they need to figure out for how long and at what pace they can carry out their production with a minimal workforce, technology support, and funds. The reason being local and international supply chains are disrupted, and one cannot say till how long this situation remains the same.

If a manufacturer is heavily dependent on the demand of a specific region or country, he may have to slow down his operations due to a lack of demand because of COVID-19. Low demand means a low supply and returns, leaving little funds for the manufacturer to operate. So, manufacturers need to assess their new strategies from every angle so that they are ready to face the forthcoming unexpected challenges.

This is a challenging situation for manufacturers for sure, and they cannot halt their operations for long. The above-mentioned suggestions will surely help manufacturers to not just get started but ensure smooth business operations in the future. Yes, they need to devise strategies, keeping in mind not just the present scenario but the possibility of forthcoming events, to stand strong against any unfavorable circumstances that might arise in the future.

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Gia Glad works as a Business Development Manager at Cogneesol, a well-renowned company offering data management, technology, accounting, and legal services. While handling the projects, she has witnessed a lot of changes over the years. She has been thoroughly researching and sharing her viewpoints about these industry trends and changes on many platforms across the Internet.

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Archives, Global Trade Daily, Special Reports

How Aristotle Can Help You Lead Your Business Through Tough Times

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Business leaders face plenty of questions as they try to get a handle on the new economic reality brought about by the COVID-19 shutdown and the resulting recession.

But the answers to those questions may not appear in their corporate handbooks. Instead, they could lie in ancient philosophies with lessons that apply just as much today as they did centuries ago, says Cristina DiGiacomo (www.cristinadigiacomo.com), author of Wise Up! At Work and founder of MorAlchemy, a philosophical consulting firm that helps CEOs and executives tackle their biggest challenges by teaching them how to think differently so they see new solutions and their companies thrive.

“We could all use a little wisdom these days because COVID-19 has caused a shift in the way people think, the way people work, the way they live and how they think of themselves,” DiGiacomo says. “Technology may change, culture may change, but acting wisely is no different in the 21st century than the 5th century.”

Too often, when people hear words like philosophy and wisdom, they conjure images of a bearded man on a mountain, with enlightenment seekers trekking to see him, DiGiacomo says.

“In reality, the philosophers whose teachings changed the world were the kind of people who rolled up their sleeves, got to work, dug deep, and spoke up despite hardship, resistance and even threat of death,” she says. “Their views aren’t some abstract idea but have practical applications in today’s world.”

So, if Aristotle, Socrates, Voltaire and Immanuel Kant opened a corporate consulting business, here are a few things they would tell you about moving your business forward as the world tries to recover from COVID-19:

Don’t be rushed into rash decisions. Voltaire said “doubt is an unpleasant condition, but certainty is absurd.” Sometimes CEOs feel the need to make quick decisions, perhaps to avoid seeming indecisive. That’s not always the best approach, DiGiacomo says. “Are you making critical decisions, with long-term consequences, on the fly without actually having developed your ability to deliberate?” she asks. “Our reactionary mind wants us to set it and forget it, so it can move onto the next thing.” Resist that temptation.

Avoid letting your “darkest moments” color reality. Immanuel Kant, among others, believed your mind shapes and structures your experience. “Your mind influences to a very large degree how you see the world and how you feel about it,” DiGiacomo says. “Those things you say to yourself, in those darkest moments, are shaping your reality. But it’s entirely possible that those thoughts you have about what you think reality is might not always be true.” She says it helps to “hit the pause button” and make sure the situation is what you think it is.

Say “I don’t know” even if you think you know. The country faces uncertain times over the next several months, but that’s not unusual, DiGiacomo says. The future is always uncertain – coronavirus or no coronavirus. One of her favorite quotes from Socrates is: “I know that I know not, and that makes me a wise man.” DiGiacomo says being in “I don’t know” mode releases your mind to discover new solutions and ideas. “If you constantly believe you know everything,” she says, “then there’s no impetus for your mind to be creative or continue to look for new information.”

And finally, DiGiacomo says, Aristotle offers encouragement for business leaders who are afraid they aren’t up to the task of making wise decisions. “Aristotle’s foundational idea of being human is that we are all wise, inherently,” she says. “It’s just a matter of tapping into that innate wisdom and building the skills that will help you to not only be wise, but to act wisely.”

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Cristina DiGiacomo (www.cristinadigiacomo.com), author of Wise Up! At Work, is the founder of MorAlchemy, a philosophical consulting firm. She also is the inventor of industrial philosophy and is the driving force behind the idea of applying philosophy in the workplace for the benefit of the leadership of organizations. DiGiacomo has 20 years of corporate executive experience at companies such as The New York Times, Citigroup, AMC Networks, and R/GA. She holds a master’s degree in Organizational Change Management from The New School. She also dedicated nine years to the study and practice of philosophy.