Leaders FOCUS their organization during a crisis.
The COVID-19 pandemic has presented us with what might be the most unique business experience of our careers, one we are all trying to wrap our minds around from a public health perspective. I’m not qualified to speak to the health aspect of COVID-19, but my experience leading several companies through very difficult crises has left me thinking, “What would I do if I were leading a company right now?”
This is a moment in time when “work from home” companies should be thriving or at the very least preparing to thrive. Whether your company is in “crazy growth” like the company of one executive I recently spoke with, or in “survival” mode, this is a time for leadership.
Be In Action
I thought I would share ten tips that might be helpful to those leading a company today. Before I jump into those ten tips, first let me emphasize how important it is for you to be in action.
In a briefing with senior technology leaders on March 21, the renowned Harvard Business School graduate, digital media expert and educator Clark Gilbert observed how this crisis has completely distracted some: “We see a lot of people kind of in paralysis. They’re so nervous about what’s going on that they have stopped everything. I think there’s a tendency to only live in crisis mode.”
In a recent article titled, “Leadership in a crisis: Responding to the coronavirus outbreak and future challenges,” McKinsey & Company acknowledge how difficult it can be to make decisions but emphasized the need for decisiveness and action.
“Waiting for a full set of facts to emerge before determining what to do is another common mistake that leaders make during crises. Because a crisis involves many unknowns and surprises, facts may not become clear within the necessary decision-making time frame.… Once leaders decide what to do, they must act with resolve. Visible decisiveness not only builds the organization’s confidence in leaders; it also motivates the network of teams to sustain its search for solutions to the challenges that the organization faces.” [Emphasis added.]
In my career, I have seen that the biggest challenges direct selling companies face are rarely a result of decisions that are made, but poor outcomes result when company management fails to act. Inaction or the inability or unwillingness to make decisions is the first obstacle to overcome. Once a leader begins to act, they have the potential to influence a positive future outcome for their company.
Those leaders in action or now determined to act may consider the following ten tips which I’ve broken up into field imperatives and corporate leadership suggestions.
For Salesforce Leadership
- Communicate—Consider your own experience with COVID-19. On Wednesday morning, March 11, 2020, most of us woke up aware of the possible impact of this strange new virus, but few of us had been impacted in any meaningful way. By the end of the day, the NBA had suspended play, the NCAA had announced that March Madness would be played without fans and things began to get surreal. Since then, each day has brought more and shockingly unimaginable news of how this virus would impact us, regardless of whether we will ever test positive as a carrier of the virus. In a world that changes so dramatically each day, your field needs to hear from you and your team. And more important, you need to be on-message.Timothy R. Clarke, founder and CEO of LeaderFactor, wrote for the Harvard Business Review:
“Update even if there’s no update. Uncertainty fuels anxiety. The more you communicate and share, the less chance there is to develop an information vacuum within your team. Communicate regularly even if you don’t have new information to share. Maintaining transparency through a crisis with frequent updates is the ultimate expression of good faith, empathy, and genuine concern for your team.”
In my career, I have seen that the biggest challenges direct selling companies face are rarely a result of decisions that are made, but poor outcomes result when company management fails to act.
Those companies who are using an app with push notifications have an advantage in their ability to have touch point communications with their team multiple times a day. App messaging, text messaging and email should be used, but should not be the only method of communicating. In the absence of in-person meetings use video conferences, webinars and phone conferences to make announcements, provide updates, and to give your field an opportunity to share best practices with one another.
One last warning: Make sure your communication is on-point.
One consultant told me she was helping a company with damage control after the company’s COO updated the field and concluded, “We will be filling orders and getting product to your customers… for as long as we have product available to sell.” Needless to say, the only thing the field heard was “soon we won’t be able to get product,” and new customer acquisition ground to a halt.
- Focus—There are a few companies who are fortunate to have products that are in high demand right now (e.g. oils, hand sanitizer, etc.). Whether or not your products are in demand the “work from home” message has never been more relevant. Wise marketing and sales leaders have pivoted (or will pivot) their companies’ message to focus on their most relevant products or on the benefits of having a second home-based source of income.Some leaders have the ability to influence their field to refocus their message simply by directing them via communication to do so. Other leaders will use promotions and offers that are compelling enough to focus the field on the relevant message and will provide them a method for sharing that offer.
- Systems—Your field has too many things competing for their attention right now and therefore they need you to tell them exactly what to do. They need a system or a method of delivering the message or engaging new prospects that supports the relevant product or opportunity. Several of the most successful companies have deployed sampling programs, many supported by an app, to simplify things for their field. And for those who think that it is too late to arm their field with a method, you may be surprised to hear that in just six weeks It Works! pivoted their field focus on a new product and an online sampling method that has produced significant growth.Kyler Pentecost, VP of Sales at It Works! said, “New distributors can send corporate-sponsored content and product samples to their prospects as soon as they download the app. The app has taken our sampling and customer acquisition systems to a completely new level. If I could give one piece of advice to anyone considering it, it would be ‘the sooner the better.”Noah Westerlund, Senior Vice President of Business Development for SUCCESS Partners, helped implement the It Works! app and sampling program and said, “Whether clients are using our NOW App, or one of our competitors, there is now plenty of case studies to prove that there is no better way of preparing your company for exponential growth than by having a simple, and preferably automated, method of giving prospects a product experience.”
- Value—There is nothing that motivates distributors to share more than a compelling offer for their customers. If you want to get your field’s attention and see them break through the noise of the 24/7 COVID-19 news, give them a compelling, limited-time offer that supports your most relevant product/service/opportunity. Now is the time to deploy some of your most compelling offers like FREE enrollments, deep discounts, FREE shipping, and FREE with purchase promotions. These promotions will be even more effective if they are supported with a system that eliminates the “what do I do” or “what do I say” questions.
- Hope—Hope is the field’s fuel. Without hope distributors stop recruiting, stop selling and start looking for something else to do with their time.Most executives built their business on stories of hope and opportunity. These stories generated enough hope to convince early employees, investors and distributors to join a company with plenty of flaws. Often we get out of practice and stop telling our hope-inspiring stories. If that is you, it is time to reassume our role as “Chief Hope Officer.” Leaders need to dust off the story of their purpose, and should begin to share their vision again with employees, shareholders and distributors. Be active and engaged in restoring hope and fight for resources to protect the company from the enemies of hope.
In a world that changes so dramatically each day, your field needs to hear from you and your team. And more important, you need to be on-message.
For Corporate Leadership
- People—Often it is easy to take your home office team for granted and to focus too much of your energy on caring for your field. Leaders need to acknowledge the enormous challenges employees are facing as they are trying to respond to the chaos of the moment, and for those with families, to lead their families in a world that has removed most of the social norms that provided structure to their lives.On the Direct Selling Association’s industry call on March 19, Nu Skin President Ryan Napierski said that his management team was surprised to see a productivity improvement after the company sent all employees home to work remotely. However, don’t underestimate the challenges your employees will have as they adjust to the world of “work from home.” Even those who have worked in a virtual company will face new challenges as both parents return to a house with children home from school.In a March 20, 2020, conference call sponsored by Silicon Slopes, Qualtrics CEO Ryan Smith said, “We’re seeing a lot of data coming back that is showing that the work environment at home is just fundamentally different. It’s challenging. It’s incredibly stressful. We weren’t prepared for it.… We found that people didn’t have workstations, they didn’t have cable cords, they didn’t have computers and monitors and we basically said take whatever you want out of the office.”
As your organization adjusts to social isolation, Qualtrics has made available a free “Remote Work Pulse” survey tool you can use to make sure you are caring for your employees. According to the Qualtrics website this tool was created to help “you understand if your organization is prepared for a remote workforce, and if your employees have what they need to succeed in this new environment.
If you want to get your field’s attention and see them break through the noise of the 24/7 COVID-19 news, give them a compelling, limited-time offer that supports your most relevant product/service/opportunity.
“There are three things every organization must do immediately, and the order you do them matters.” The three things Qualtrics suggests you must do (in this order):
- Ask employees if they are OK
- Ensure they have what they need, and…
- Act quickly to help employees stay productive
Smith said, “We all need to be feeling productive, or we’re going to go nuts, especially if we’re all quarantined for 30 days, or however long it’s going to be.”
You can use Qualtrics’ Free Remote Work Pulse by visiting their website:
- Teams—Recognize that these unprecedented times will bring with them the need to respond quickly to new and changing variables. McKinsey & Company suggests that companies have “action teams” focused on execution and a “response team” that is gathering external data and filtering that data to decide if and how externalities should impact the company’s current plans. Your response team will also be responsible for making sure there is a unified message communicated to the appropriate audience. Turbulent times are stressful enough, the last thing a company needs is confusion. Make sure that your team is unified minute by minute in plan, purpose and messaging.
- Cash—Neil Blumenthal, CEO of Warby Parker, reminded us that “for better or worse, cash is the oxygen of your business, and you can’t last long in any environment without it.” No matter what direction your business turned on Friday, March 13, your cash position changed. Your finance and accounting team need to be on top of that change immediately.Change tends to impact cash negatively no matter its direction. Hypergrowth comes with significant cash demands as companies invest in inventories and infrastructure to sustain momentum. Likewise, declining sales can drain cash reserves quickly if companies are unable to respond quickly enough and reduce spend.Everyone reading this article should demand a new cash forecast today. When you get that forecast, make sure that it accounts for today’s trend and only today’s trend. Too many companies find themselves in a cash crunch because they have ignored trends or tempered them with optimism that the current trend data did not support.
For the sake of your company, your field and your employees, always err on the side of preserving cash early. Never allow yourself to be blindsided with a cash surprise. Review your cash position and forecast as frequently as your trend changes.
Be aware of the fact that Congress is working on legislation that would allow businesses to borrow money from SBA approved lenders without showing they have the ability to repay the loan. Congress is proposing legislation that would guarantee these loans so that banks are not put at risk and are anticipating that many of the loans would be forgiven if companies are able to show they were judicious in the use of the funds and that they aren’t able to repay the loan. If your business is in decline look at these loans. If you are growing, apply for money—especially if you don’t need it—to avoid being turned down when you do need it.
- Supply Chain—This crisis is unique because it has impacted both the supply side of the economy and the demand side of the economy. It began in one of the world’s most important centers for manufacturing of raw materials. There was an early stress placed on many companies as manufacturing closed and component parts became scarce in many industries.As Chinese workers return to factories; the supply side issues have now been replaced by demand issues. These issues are particularly acute for companies who rely on consumer gatherings (at a store or in-home at a party). However, as we prepare to see the highest single unemployment claims number since the Great Depression, companies are in danger of seeing demand for their products decrease.Fortunately, many network marketing companies are beyond their previous supply issues and are seeing an increase in demand precisely because their business model aligns with social isolation requirements. For these companies, the challenges that may lie ahead is a disruption in U.S. manufacturing and/or order fulfillment.
Everyone reading this article should demand a new cash forecast today. When you get that forecast, make sure that it accounts for today’s trend and only today’s trend.
As of this writing, more than 20% of the U.S. population lives in states with government-mandated in-home quarantines. We have yet to see how these government-required shutdowns will impact our manufacturers and the suppliers who pack and deliver our products. Companies need to plan and be prepared to respond to either eventuality by having daily updates from vendors and strategic supply chain discussions with your response team.
- Communicate—Your employees need to hear from you often, and they need to be able to have quick access to what is likely to be ever-evolving plans and initiatives. Take time to implement real-time communications tools and plan formal frequent updates. Communicating often and thoroughly is helpful, but studies show that you will relieve stress by creating structure in the how and when you communicate. Make sure that employees are not surprised by your communication, and don’t make them worry about missing important information.
These times call for resolve, what Jim Collins calls the Stockdale Paradox, named after James Stockdale, the highest-ranking military officer held as a prisoner of war in the Hanoi Hilton. Stockdale was in captivity for seven years and was tortured over twenty times. His survival was a result of what Collins has labeled the Stockdale Paradox:
- You need absolute, unwavering faith that you can prevail regardless of the difficulties, and
- You must confront the most brutal facts of your current reality, whatever they might be.
While the brutal facts of this crisis will demand that we balance the best human care with the best business leadership, I see so much opportunity that will come of it for the future of direct selling.
These tough times won’t last, but tough-minded leaders will and their companies and the tens of thousands of families they lead will emerge better than ever.