From: BCG Henderson Institute: https://bcghendersoninstitute.com
By Martin Reeves, François Candelon, and Kevin Whitaker
Read the complete article here: https://bcghendersoninstitute.com/fostering-organizational-stamina-2f8c96b15404
One of the most common questions managers ask about the COVID-19 crisis is, “When will it be over?” The question reflects an understandable fatigue with living under protracted uncertainty and a desire to return to normalcy. But not only are we unlikely to return to the pre-crisis normal, it could also be quite some time until we reach a new steady state and uncertainty abates. It’s even possible that there may be no prolonged equilibrium before the next disruption. How, then, can leaders address a rising sentiment of impatience and foster the stamina required for organizations to successfully adapt to new conditions?
A long journey
While we can’t be sure when the outbreak will be resolved, it seems likely that it could be protracted. Cumulative case numbers are plateauing in many nations, but the epidemic continues to spread in others. Furthermore, the disease may not end with the first cycle; epidemiologists warn that the disease could exhibit a second wave, as many viral outbreaks have historically had, or could even become endemic, like the seasonal flu. Uncertainty about the disease is likely to persist until at least the widespread deployment of a vaccine, which is not expected until sometime next year in even the most optimistic scenario.
As a result, uncertainty will persist in our everyday lives. For example, hundreds of epidemiologists recently surveyed by the New York Times gave a wide spread of opinions on when they would be comfortable resuming common activities. A majority said it would take anywhere from 3–12 months before they would feel comfortable going to work in an office or eating at a sit-down restaurant, and most said it would be more than a year before they would attend a sporting event or performance.
Economic uncertainty is also unlikely to disappear quickly. The National Bureau of Economic Research recently confirmed that the US economy is in recession and the World Bank predicts a 5.2% contraction in global GDP in 2020. Cautious consumers are likely to prolong the period of economic uncertainty and adjustment and unemployment and bankruptcies could have lasting economic effects.
And both the disease and the recession have had created broader impacts across society, bringing concerns about inequality and justice to the forefront. The recent wave of protests in the US and some other countries will likely also have some lasting impact which shapes both policies and consumer behaviors.
It is not surprising therefore that many businesses are increasingly envisioning a long period of uncertainty. According to our survey of hundreds of companies across countries and sectors, as of March only 14% of companies expected COVID-19 to affect their business for more than 12 months — but by May that share had more than tripled to 46%. And whereas in the early months of the crisis, only 20–30% of companies expected to make permanent changes in their supply chains, marketing activities or sales channels, by May that share had doubled to 40–60%.
Read the complete article here: https://bcghendersoninstitute.com/fostering-organizational-stamina-2f8c96b15404