More On Disruptions
However, research is showing the most successful organisations are those that achieve continuous transformation and keep innovating throughout disruptions. To do this you need to develop organisational capabilities that are interdependent, ie
a) Nimbleness (ability to plan and implement change quickly, ie agile and flexible; pivot and move quickly; it
"...determines both the speed at which organisations act and their ability to pivot when circumstances merit a significant change in direction. Digital technologies enable nimbleness in resilience companies..."
Gerard C. Kane, et al, 2021)
Technology can be both
i) an enabler of nimbleness (help to handle impacts of the disruption) and/or
ii) a source of disruption (forcing mechanisms for development of a nimble organisation)
Some examples include
i) using machine learning algorithms to extract patterns of customer data to tailor goods and services to select segments with speed and effectiveness that is superior to human intervention
ii) using cloud computing to set up new business and technical capabilities without costly systems upgrades and time-consuming implementation processes
iii) digitalisation of safety and productivity systems allowed an enterprise storage solutions company to quickly repurpose those systems into social-distance monitoring infrastructure needed to restore the factory's capacity during the pandemic.
"...The company used its existing cameras and sensors, equipped with lidar and thermal imaging, and ran a hackathon that developed the algorithms needed to monitor social distancing and Covid-19 symptoms within two weeks. Previously these solutions had been driving productivity improvements......Now...... automatically monitor 2-meter restriction and provide feedback to employees..."
Brad Surak as quoted by Gerard C. Kane, et al, 2021
iv) chain of 62 restaurants in Chicago (USA) had to shift customers from dining-in to drive-through; also had to adapt its service model to offer online ordering and curbside pickup; jobs were redesigned, eg in-house wait staff were moved to support call centres and delivery (the latter deliveries were done in-house rather than relying on third parties; consequently, no staff were laid-off . Part of this exercise involved focusing on things that you can control and discarding things that don't matter)
b) Scalability (ability to rapidly shift capacity and service levels; resizing at the speed of demand and supply. For example, the tech giants like Google, Facebook, Amazon, etc that are able to meet operational dictates of rapid growth. However, in regards to acute disruption, it involves
"...the ability to cope with unanticipated, exponential rises and falls in demand and supply that can develop overnight..."
Gerard C. Kane, et al, 2021
Some examples
i) Zoom
"...Between December 2019 and April 2020, number of meeting participants using the platform each day rose from 10 million to over 300 million..."
Gerard C. Kane, et al, 2021
ii) Amazon and freight organisations, like FedEx and UPS, had to scale up to handle the demand spikes
iii) online, digital learning exploded, eg 300% increase in some organisations.
Conversely, some organisations like cruise lines, hotels, movie chains, airlines, etc had to scale down rapidly.
The use of data and analytics can provide a sound basis for decision-making during and after the disruption, ie determining what is happening to the demand now and in the future. Additionally, communications and the way key stakeholders are treated are important links with the decision-making process. For example, one international hotel group (with over 1 million positions) experienced a 90% drop in demand at the start of the pandemic. Rather than dismiss staff when they temporarily suspended operations in many hotels, they reached out to organisations, like in retail, that were experiencing demand surges and develop agreements that offered their staff preferred application status. In this situation, everyone won, ie the staff had jobs, the new organisations got to employ quality staff and the hotel both retained a pool of staff to draw on when things recovered and maintained its relationship with its staff. The hotel used its digital recruitment system to help staff search for jobs with organisations it had agreements with, ie its recruiting funnell was reversed. This hotel group was ranked third in Fortune 100's Best companies to work for in 2021)
c) Stability (ability to maintain operational effectiveness under pressure; maintain trust in the face of insecurity and uncertainty
"...Stability enables resilient companies to maintain operational excellence while nimbly pivoting and rapidly scaling. This capability is essential for ensuring an organisation's trustworthiness during disruptions..."
Gerard C. Kane, et al, 2021
For example,
"...Pfizer's pre-pandemic investment in digital R & D and artificial intelligence allowed the company to develop a vaccine in record time......to maintain its safety and security standards during the crash program......stability was essential at all stages of the project - during the vaccine's development, production and distribution. Stability...... emphasises trust as a foundational component of its organisational culture..."
Gerard C. Kane, et al, 2021
"...stability involves the ability to use digital platforms to enable companies to respond to shocks..."
Gerard C. Kane, et al, 2021
For example, in a US hospital, its IT unit developed an app that transformed the cameras in tablet computers into 'electronic personal protective equipment' by enabling doctors and other staff members to closely monitor patients and equipment in intensive care units without entering patient rooms.)
d) Optionality (ability to acquire new capabilities through external collaboration, like partnerships, joint ventures, etc; plug into an ecosystem of external capabilities, ie capitalise on external experimentation, new ideas, etc; It is
"...The ability to leverage capabilities of other companies and organisations to become even more nimble, scalable, and stable..."
Gerard C. Kane, et al, 2021
The wider the collaboration, the greater the access to both more collaborators and potential innovations at a lower cost.
It involves experimenting, learning and importing capabilities to handle disruptions. Need to increase the volume, quality and risk tolerance of experimentation and learning )
To develop robust ecosystem of partners you need
i) alignment on vision of the future
ii) co-creation of value model
iii) a change management roadmap for the eco-system which is continually evolving
Summary
Each of these capabilities is supported by digital technologies like cloud computing, data analytics, machine learning, cyber-security, etc.
What is pivotal is how the companies use the technology to transform themselves in response to the disruption.
Once the pandemic is over, most organisations will not return to 'business as usual'; it is expected that there will be further unleashing of innovation, technology and competition.
The 4 capabilities are part of a 3-step process, ie
i) respond (involves immediate and decisive action to respond to the existential threat)
ii) regroup (not to return to the past but explore how to take advantage of the opportunities presented by the disruption and the organisation's response)
iii) thrive (exploring new directions, consolidates transformational changes developed during the disruption and builds an even more resilient and successful organisation)
NB An organisation has to have the right culture to leverage the capabilities of digital infrastructure so that it can make quick decisions and re-purpose this infrastructure to meet new challenges that can emerge during disruption. Part of this culture involves
- encouraging experimentation and continual learning
- recognising and rewarding collaboration
- accepting the risk of failure, ie it is a learning experience
- using cross-functional teams which enjoy considerable autonomy