This article is an interview between Dr. Virginijus Kundrotas, Managing Director of Adizes Institute Lithuania and Journalist Milda Tarcijonaite‘s in main Lithuanian Business daily "Verslo zinios".
No matter how intelligent a manager would be, it is hardly possible for one alone to find the most optimal solution in our fast-changing world. The challenges that had been brought by the worldwide pandemic, once again proved that it is much easier to navigate an organization's ship when you have a reliable team on your side.
When governments suddenly announced quarantine, it strongly affected the everyday life of businesses or even turned it upside down. Different organizations felt it differently, depending on the business sector, organization's activity and size.
Dr. Virginijus Kundrotas, a certified Senior associate of the Adizes Methodology, Managing Director of Adizes Institute Lithuania and the Dean of Adizes Graduate School, elaborates that CEOs of companies whose activities were completely suspended (hotels, tourism agencies, and partly restaurants and cafes) were on the edge of a survival dilemma. To stop or to continue operating, how many and which employees to let go, how to pay debts and so on, were high on their agenda.
That kind of situation, also known as crisis management, demanded fast, operational decisions in order to survive in business today and recover tomorrow. It is called the scenario of ‘firefighting’, when immediate cost optimization and operational decisions are needed.
CEOs of other companies that had been operating in a market that was temporarily losing demand, or that had not produced essential goods during the time of the pandemic, faced other challenges. How might they reorient and adapt to the change in market demand, temporarily changing even the activity profile of the company, but also using competencies, knowledge and skills they have?
Kundrotas gives an example,"how do you have innovative ideas emerge in the company and implement them quickly? Some companies started to produce protective masks, or other products or services demanded in time of the pandemic." According to V. Kundrotas, there were companies whose CEOs' main challenge became how to further expand the existing areas of activity, where to get more new skilled workers, ad how to use this situation to expand their market segment, as the pandemic increased the need for their activities.
"It is online trade, production and distribution of medical goods, and production and trade of food products. The managers of such companies thought about how to manage the growing market demands and how to guarantee the safety of their employees who have to work even more intensively in this situation," V. Kundrotas specified.
Mutual Trust and Respect
V. Kundrotas emphasizes that in the situation of a major surprise or shock, it is extremely difficult to keep a cool mind and not panic. The right balance is needed between hot-headed decisions and inactivity.
"In a time of crisis, one of the main mistakes of managers is the belief that they individually have to find a miraculous and right solution. A, 'what to do now'. The more complex the situation, the less likely it is that one person, no matter how smart he or she may be, will find the right solution,"
As Kundrotas experience shows, companies with a culture of mutual trust and respect, companies where managers openly and transparently address emerging challenges with their team, discussing and jointly finding solutions, openly exploring even the most complex alternatives together, are the most successful in overcoming critical situations.
Kundrotas summarizes the importance of working with the team, "the decisions become joint decisions, which helps in both cases when the right decisions are made, but also especially when a mistake is made too. The mistake becomes a team mistake, it motivates everyone to quickly find ways to fix it, and do that as soon as possible. When one single individual makes decisions and they do not work, the chance of panicking increases. At the same time, a risk of making mistakes alone again emerges".
A look at the CEO
Until the COVID-19 pandemic, most CEO comprehension about crisis management was theoretical and knowledge was more or less the same: a leader's success or failure are directly related to their ability to mobilize a team, demonstrate peace and empathy, make decisions quickly but not hastily, and communicate effectively.
V. Kundrotas agrees that in a difficult time, the proper leadership behavior is especially important. Behavior maintained by the manager who shows an ability not to panic, and believe in the successful future, the organization and its people, generates energy among the team members.
Kundrotas provided the example on one of his clients, who is the owner and president of a company. This person, at the very beginning of a pandemic threat, communicated to all his employees that none of them will be fired and all liabilities of the company will be fulfilled.
"The company is really big in Lithuanian measures, and such a promise was not easy for owner from the financial perspective. However, the promise was kept, which calmed down the employees, allowed them to continue to work firmly, and motivated them to develop new ideas and innovations. As a result, the company not only did not lose the growth rate, but also offered many innovative solutions that opened the way for further development," says V. Kundrotas
The pandemic reaffirmed that honest cooperation is one of the most important elements. According to Kundrotas, when a company performs trust and cooperation not only internally, but also with customers, suppliers and business partners, then the "win / win" principle really starts to work.
There are a lot of predictions that we will not avoid the second wave of the pandemic and businesses need to think ahead about how to withstand a new shock.
It is already worth analyzing plan B and possibly C together with your team, rethinking several possible scenarios. They may not reflect an absolutely accurate situation, but will allow you to identify possible strategies that can not only save costs, but also prepare the company's teams psychologically for a possible wide range of challenges, focus and allow more trust in each other.
The future is in unity and integration.
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