What if I told you that there as a way to make your organization recession proof, crisis proof, uncertainty proof? Wouldn’t that come in handy for future pandemics or changes? This was the topic of discussion at my second TEDx talk. In it, I share the robust strategies of the TELCoS Model of Immunity. You can watch the talk here or read the transcript below.
I heard a joke recently. It goes something like this: “The Oxford English Dictionary is planning to replace the word ‘disaster’ with the word ‘2020’. How was your job interview? Don’t ask. It was a 2020”.
Honestly, I won’t be surprised if someday this joke becomes a fact because what a horribly unforgettable year 2020 has been! It pulled up ‘health’ from somewhere low on the list of our priorities and plonked it right at the front and center of our lives.
This pandemic has highlighted the proverb ‘Prevention is better than cure’ in bold, capital letters. Everyone, even those of us outside the medical fraternity, now use PPE kits and immunity boosters because we know that the only protection against coronavirus is in being more cautious.
The pandemic has made not only our health vulnerable, but also our businesses, economies and brands.
A total of over 6.8 lakh companies had been closed across India till June 2020.
The Economic Times
Almost 6 million white-collar workers and 5 million industrial workers lost their jobs between May and August 2020.
CMIE, The Economic Times
That begs the question: Was there anything we could have done to prevent such a business outcome? Whatever has happened has happened. But going forward, what if we build a PPE and Immunity Kit for our brands and businesses that would safeguard them from not only pandemics and recessions but also from competition, changing consumer preferences or technological changes?
I propose the TELCoS model of Immunity as one of the solutions. It contains strategies that I think would make for a fairly robust PPE and Immunity Kit for any company.
1. Try the T
For the first part of the TELCoS model, picture this.
Brand Goliath has 4 employees. One each for finance, sales, marketing and HR. An advertising crisis comes up and their marketing expert needs additional help. She does not need an expert marketer. A non-expert with passable marketing skills would also do. But none of the 3 other employees have any skills or knowledge outside of their field. So what does Brand Goliath do? It goes out searching for new people to hire. In all this searching, hiring, training of new people, the crisis blows out of proportion and is out of their hands. Brand Goliath’s time and money both get wasted.
Now meet Brand David which also has 4 employees. The difference is that each person at Brand David has extensively worked in cross functional teams. That’s why each one on the team is not only an expert in their field but also knows enough about the other 3 fields to chip in when needed. So, if the same advertising crisis were to hit Brand David, what do you think would happen?
Nothing bad would happen.
Brand David would instantly divert the other 3 employees to assist the marketer. Thus, at no additional cost and with the same number of people, Team David would be able to respond immediately to the crisis as compared to Brand Goliath.
People such as those of Brand David’s team are popularly known as T-shaped people.
They not only have deep expertise of their chosen field but also knowledge and skill in other broad areas (Forbes).
You could say they are Jacks of all trades AND also masters of one or two.
If a company wants to stay protected from upheavals and become recession proof, it must ensure its PPE kit contains many T-shaped people.
This will remove flab from the system, increase labour productivity. The company can get more done with fewer executives (ET).
Leaner the team, more agile the company. Greater the agility, stronger the chances of business survival.
2. Elastic and Fluid Systems
The next critical component of your brand’s Immunity Kit is elasticity in each of the 6Ps. When crisis hits, it is not enough to only have an agile workforce. For your workforce to take quick action, they will need the support of elastic and flexible systems.
If you can build flexibility in each of your 6Ps, you will end up with a structure fluid enough to take whatever shape the situation demands.
Most restaurants and shops had fixed rental agreements with their landlords and how did that work when the pandemic hit? It worked as a stone around the necks of these businesses. They had zero income because they were shut yet the fixed monthly rents had to be paid. How long could this be sustained?
Now, after learning this harsh lesson, the industry body of Indian restaurants is working with the landlords and mall owners towards a fluid rental arrangement like minimum rent plus revenue sharing (ET, BT).
Let’s consider one of the Ps i.e. ‘Pricing’.
3 students from Taipei University have created barcode stickers called ‘Barcodiscount’. These stickers change color AND price as the expiration date nears.
So for example, in your nearby mall, if the pack of strawberries is 5 days away from expiry, its barcode sticker will turn say orange and will display 20% off. 2 days before expiry, the sticker will turn red and display 40% off. This is the epitome of flexible pricing, don’t you think? (Springwise)
You don’t always need inventions and technology to create elasticity. But you do need to make a conscious and proactive effort to build that elasticity into your systems. Even a simple step of adding gig workers and freelancers to your full time workforce can make it fluid. Bottom line? Elastic systems make a resilient company.
3. Learn How To Learn
At the start of the pandemic, GE Healthcare was facing a huge demand for hospital monitors to track BP, heart rate, etc. These monitors and their accessories needed to be assembled at the factory itself. GE Healthcare’s factory did not have sufficient space. But its Aviation factory had space and also volunteering employees to start this job immediately. The only problem? Theirs was an aviation factory making power systems for aircrafts.
In the interest of time, the Healthcare team provided production expertise, training and supervision to the aviation engineers. The aviation engineers quickly picked up the basics of health monitors, started making prototypes and changes quickly so much so, that they managed to bring down assembly time from 13 minutes to 4 minutes over the months. (GE)
What do you think made it possible for people who had never worked with such a product, to not only make it but to also improvise and improve?
Another example: The US Navy has ‘hybrid sailors’ who have proven capable of mastering a wide variety of skills. Their chief skill however is the ability to adapt and learn quickly. They learn continuously, and are open to new experiences and flexible in their thinking. This is what business needs, too.
I am sure that this meta skill of learning is what helped GE’s aviation engineers quickly master health monitors. Skills change, they expire, they morph as technology changes, competition changes etc.
But if you train your employees on how to be quick learners, they can then quickly learn skills of the moment. But to create this pace of learning, your company will need to expand the learning content available to employees and use technology to deliver what is needed to each person. (McKinsey).
It will also help you create more T-shaped people in the company.
4. Cater to Contradictory Categories
Businesses face a lot of dichotomies: “Should we offer a product OR a service? Should it be in the essential OR non-essential category? Urban OR rural? Online OR offline?”
These questions are thought of in the ‘either or’ format. Thinking of these dichotomies as extreme ends of a spectrum will leave your business weak and vulnerable to any sudden change around you.
At the start of the lockdown, product and services were split into essential and non-essentials and non-essentials had to abruptly shut down. They faced severe losses and even succumbed. But diversified brands such as ITC managed to avert too dire a fate. ITC is present in essential FMCG categories and also in high end luxury segment through its 5 star hotels.
During April-June 2020, ITC’s revenues for hotel business fell 94.4% while that for FMCG rose 10.3%.
Bloomberg
While it is obvious that not every business can be present everywhere, it would do you well to have a contingency plan to cover the other end of the spectrum, whenever need arises. Restaurants are mainly service businesses but during lockdown, they crossed over successfully into the product side too with their packaged meal kits, sauce bottles, cheese packs, etc.
A distant relative lived with his family of 3 in a one bedroom apartment in Mumbai. When 2 members of his family got Covid-19, doctors advised him to self-isolate as a precaution. The problem was he did not have enough space to do that. So he went to a leading luxury hotel in Mumbai.
That 5 star hotel was offering a 14-day quarantine package at affordable rates. I was impressed with the luxury hotel’s ingenuity. By offering isolation packages, it managed to convert its non-essential, luxury offering into an almost essential one, thus securing at least some revenues.
5. “Spends Brake”
Inspired by its past financial crash, in 2009, Germany passed a constitutional amendment called ‘Debt Brake’. Debt Brake meant that the Government was allowed to spend only as much as it collected via taxes. Nothing more. For years, pretty much the whole world berated Germany for being stingy. But it was this very stinginess or prudence that enabled it to announce a huge package when it was most needed i.e. during the Covid-19 crisis. (Bloomberg)
Kishore Biyani’s Future Group’s growth, investment and acquisitions were done not through equity as much as they should have. So, interest and rent never stopped. His company faced revenue loss of Rs. 7000 crores in 4 months of lockdown. All this came together during the pandemic, forcing him to sell his company. (ET)
To avoid such a scary scenario, what if, inspired by Germany’s ‘Debt Brake’, you follow a ‘Spends Brake’ in your company?
Each department spends only from what the company earns through sales. In other words, be perpetually bootstrapped, even when business is booming and investors are willing to pour in money. Though bootstrapping your way to growth may take longer, but its far more stable.
Besides controlling spends, every business should also have a savvy investment team. Instead of only investing in typical business activities, perhaps if your company invests in securities or mutual funds or any other relevant avenues, it could enjoy an additional income stream (Business2community). Together with ‘Spends Brake’, these investments can keep your company coffers full and strong.
So let’s get our brands more T-shaped team members, teach the team the skill of learning how to learn, cater to dichotomies, build elastic 6Ps on a foundation of financial strength. That’s it! Your PPE and Immunity Kit is now ready!! Let this kit handle the job of protecting your brand and business from nasty surprises.
Stay strong and Thank You!!