The Need to Lead in Time of Crisis–Part Three: The Power of Story—To Plan, To Act, To Asses, To Adapt–Video & Articles

Does your family tell stories?  Share memories around the Thanksgiving table?  Mine does.  We like to retell family stories: when grandpa homesteaded, when dad was in the war, when our newborn son was in ICU.  Our stories define us, give our family meaning; capture who we are, how we behave and what we believe.

The same is true on a larger scale.  We retell our version of the first moon landing, the morning of 9/11, living through the Great Recession, _______ (fill in the blank with your recollection).  These chapters in our collective memory identify us as a people, a nation.

Our organizations have stories too, don’t they?  Beyond bottom lines, programs, products and number of clients served, we have stories that define our organizations:  the vision of the founder, the sacrifices of early employees, the commitment to serve customers well, the innovation that helped us scale up.  When combined, our stories reflect our corporate identity.

Right now, we are all living in the middle of a new story, the Coronavirus Global Pandemic Story.  This global story will leave its imprint upon us for years to come.  It is affecting us globally, nationally, individually and organizationally.

What is your version of the Coronavirus story?  What is your organization’s COVID-19 Story?

What have people in your organization experienced:  a co-worker testing positive, a temporary reduction in the workforce, the closing of programs, postponing an event, a stimulus check in the mailbox, a CARES Act deposit in the company account?

And what is the next chapter in your organization’s COVID-19 Story: the leadership team struggling to determine when to reopen, when to reactivate furloughed employees, when to ramp up production, how to deal with a year-end bottom line 15-25% less than anticipated?

All of these plot lines, and more, will one day make up your organization’s Coronavirus Pandemic story.

But there is another dimension to story-telling that leaders are wise to consider in this time of crisis, namely, the power of story to define the future.

Each organizational leader has a decision to make.   Either you will, A. sit back and allow the COVID-19 Story to shape your immediate future, or, B. determine the primary possibilities and variables that may occur and prepare a course of action for each key variable in your story.

Is the pandemic writing your organization’s story?  Or, are you, as part of its leadership team, stepping forward, looking forward, and writing several drafts of your organization’s future?

What are the elements in the plot of your story?  What was your level of preparedness?  Did you have reserves?  Did you have contingencies in place?  Did you already have nimble organizational muscles allowing you to adapt in this time of crisis, or are you developing those muscles as you go?

And even though many small and medium-sized businesses, both for-profit and not-for-profit, are currently at great risk, they are also well suited to embrace the opportunities that seasons of disruption can create.

So where are you, as a member of the board, or staff leadership team?  Are your “what if” sessions focused solely on worst case scenarios, or does your organizational “what if” lens allow you to look to the future, seeking to understand how you may best adapt to and perhaps capitalize on these disruptive circumstances?

The Power of Story—The Principles and Practice of Scenario Planning
Right now, there are countless calls to engage in “coronavirus contingency planning”.  And, for many, that will be no more than creating an organizational checklist to trigger actions and reactions brought on by the coronavirus’ economic impact.

But there is a more compelling and effective way to engage your people; to anticipate how you’ll deal with multiple variables, to develop habits that allow you to more effectively plan, act, assess, adapt—both now, and in the future.  The principles and practice of scenario planning are well-suited for such a time as this.

Scenario planning emerged in the 1970’s and since then, corporate leaders have found the process of scenario planning to be an effective way to “suspend disbelief” and “try on” new futures.  Peter Schwartz’s, The Art of the Long View, is a standard in the field.  Thomas Chermack’s, Scenario Planning in Organizations, provides a practical overview.

By engaging organizational leaders in the process of scenario planning, leadership teams are able to create a set of data-informed stories, with a variety of real-world alternatives, based upon key predictable elements and critical uncertainties.  The stories that emerge from the scenario planning process are not predictions, rather they provide a leadership team with an informed sense of the risk and reward linked to internal actions and external driving forces.

Though the scenario planning process is often focused on long-range planning, its principles may also be applied to short term contingency planning in order to provide a richer, better reasoned set of options for action.

The primary phases of the scenario planning process are:

  • Phase 1—Identify the Purpose, Assemble the Team
  • Phase 2—Conduct Focused Research, Identify Driving Forces
  • Phase 3—Create Data-Informed Plots, Write Multiple Scenarios
  • Phase 4—Use Scenarios to Identify and Monitor External Developments and Make Internal Decisions

The challenge facing the scenario planning team is to pinpoint predictable elements that will occur and must be addressed, as well as identify key uncertainties, external driving forces, that may affect the organization:
Economic Recession            Pandemic Resurgence
Depleted Reserves                Loss of Credit
Competitor Closes                Supplier Stops Production
Leader Tests COVID19 Positive    Clients Reluctant to Reengage

Four Coronavirus Plots
Many experts and agencies are making predictions about the timing and impact of global Coronavirus recovery.  From amidst all these projections, here are four recovery parameters worthy of consideration:

  • The V—The Quick Rebound (3—5 months)
  • The U—The Gradual Restoration (6—12 months)
  • The Swoosh—The Slow Renewal (12—18 months)
  • The W—The Resurgence (8 months growth, 4 months virus resurgence, 8 months economic resurgence)

Four Scenarios
To better understand how scenario planning can help an organization “rehearse” the future, here is an example of a hypothetical business, and a hypothetical set of scenarios for the season of coronavirus recovery.

The Event Coach, INC
The Event Coach was established in Seattle in 2004 by Christy McIntyre.  First known as Christy’s Conference Boutique, the business has grown as Christy leveraged her relational sales aptitude, adding staff and services.  Now, with offices in Seattle, Portland and Boise, The Event Coach, offers high end event management for corporate and major nonprofit events.

The business has also branched out; offering Christy’s relational sales training content to individuals and vendor companies within the event space.   The Event Coach team created a four-month Event Sales Certification experience, delivered face-to-face in four, two-day modules.  The cost of training is $5,000.  The certification is for people seeking to develop and improve their sales ability in the event space.  Trainees include:

  • Hotel/Convention Sales
  • Wedding Venue Owners
  • Event Caterers
  • Photographers
  • Launch Event Planners
  • A/V Providers

Christy continues to manage the Seattle office, while having added a full-time regional manager in both Portland and Boise.  Each is responsible for regional sales of events and working with the array of caterers and vendors to manage each event.

The Event Coach enjoyed $3,100,000 in sales in 2019.

  • $500,000 Event Sales Certification (100 trainees)
  • $300,000 Full-Service Wedding Planner (30 weddings)
  • $2,200,000 All Inclusive Corporate Event Planning (10 Seattle events, 5 Portland events, 3 Boise events)
  • Net revenue was $350,000 (9 full-time employees, 3 in each city, plus contract event labor in each city)
  • Year-end cash reserve was $375,000 (equal to six month’s salary)

Creating Scenarios for Post-Corona-Recovery
In February 2020, Christy McIntyre, her two regional directors and corporate strategic planner she has come to know through her work, gathered to examine cash flow projections, determine what events had canceled vs. postponed, refund deposits, and deal with all the things associated with being part of an industry literally decimated by COVID19.

Then, they gave themselves 9 days to map out potential futures for The Event Coach.  They used the data they gathered to craft four scenarios to help The Event Coach navigate the sudden loss of business, anticipate the opportunities and challenges that lay ahead, and identify potential new lines of business, while The Event Coach seeks to regain and renew is event-based clientele.  These are their stories:

V—The Roaring 20’s
Business is back.  The coronavirus doesn’t like warm weather.  And more importantly, the antiretroviral drug originally developed for HIV—Remdesivir—has proven an effective treatment for those with COVID19, and as a preventative for health care workers.

It’s like the nation flipped a switch.  Christy’s phone is ringing off the hook, Portland and Boise too.  65% of the canceled spring events are being rebooked for Fall/Winter of 2020.  Christy had furloughed six of her nine full-time employees for three months (March—May).  But when June arrived, and the states began to loosen their shelter-at-home restrictions, Christy took a chance and brought back the three executive assistants to work with the managers in order to connect personally with every client.

As The Event Coach bookings have come roaring back; it’s business as usual.

U—Same Time Next Year
Turns out the prognosticators were right.  Those who predicted that the corona-recovery would take the economic shape of a U hit the nail on the head.  Though there were gradual improvements in treatment protocols and the tracking of those infected, people remained nervous.  Just plain afraid.  This resulted in a lack of consumer confidence.  People stayed home, watched the political drama play out on TV, waited to vote by mail in the November Presidential election, and then waited some more for the election results in December.

Not everything was lost, as the states of Washington, Oregon and Idaho each conducted their own versions of a “phased recovery”, Christy was able to reconnect with several anchor customers and book a series of smaller events; enough to cover two salaries.  But hard decisions had to be made, two of the three offices were shut down, and Christy asked her regional managers to work from home at ¾ pay.  Four employees were released after their furlough had extended beyond 3 months and the reserves were 80% depleted.  One of the employees sued Christy for back pay.

One bright note was the development of “Christy’s Online Auctions”, a video auction service she marketed to regional nonprofits to make up for canceled galas and auctions.  It was run out of her Seattle office space, with a little help from her A/V contacts, the proceeds covered Christy’s annual salary and lease commitment.

Swoosh—The Long Road Back
Early on, Christy and her colleagues determined that they would need to shift their business revenue stream focus if they were to survive the effects of a slow Corona-Recovery.  Christy had experienced a slow pace of recovery once before, post Great Recession, and she knew she didn’t want to wait this one out.

So, she approached a long-time corporate client, now a fan, and asked if she would like to become a silent partner for 10% of the company.  This was necessary to secure enough capital to acquire the training arm of one of The Event Coach’s primary event sales training competitors—US University.  This national, for-profit university was cutting back, shuttering programs.  Christy knew the chief administrator.  For $250,000, The Event Coach would acquire US University’s training material, on-line/on-camera training equipment and, most importantly, their 200,000-person prospect/client list.

The Event Coach suspended its face-to-face event sales training program and launched “Conversations with Christy—Personalized, On-Camera Event Sales Training”.  Christy would train and coach online, and her expanded database and electronic word-of-mouth helped her double her number of trainees from 100 to 200.  The “Sell the Rebound” campaign was a success.

Christy and her two managers practiced what they preached.  Earlier they helped their clients negotiate conference deposit refunds to aid liquidity, with a client commitment to rebook at the same price within 24 months.  In the fall of 2020 they created a personalized virtual scrapbook for each of their former clients, contacted the venue where the event was last held, penciled in a calendar hold and then began to hold one-on-one sales meetings to fill their 2021 event calendar.  Gradually, the bookings returned, and by the winter of 2021, The Event Coach had 12 employees, 3 focused on the national on-line event sales training business, 9 focused on event planning and production.

W—Feast and Mini-Famine
It seemed like the optimists were right, there was an economic resurgence at the end of the 3rd quarter and into the 4th quarter of 2020.  Christy and her colleagues thought they had made it through.  They rebooked postponed events and enrolled a full class of trainees in Q4.  But then, January 2021 arrived and so did a resurgence of coronavirus, this time fanning out from the continent of Africa.  Governors, wanting to err on the side of caution, shut their states down quickly.  Shelter at home was back.  Business was postponed once again.

Christy was heartbroken.  Exhausted.  They had fought to survive for so long.

Then, she got the call.  Her primary competitor asked if they could meet in the Starbucks parking lot near her office in Bellevue, a car to car, open window meeting.
Mark Jacobs, owner of Convention Services, INC., pulled up beside her, rolled down his window and handed Christy a piece of paper and asked her to sign.  It was a Non-Disclosure Agreement.  She signed and Mark told her that he’d had enough; he wanted to sell, and he wanted to sell his event management practice and his book of business to her.  Christy bit her lip trying to conceal her excitement.  She knew things would rebound, people are essentially relational beings, they needed to come together for a sense of belonging, purpose and inspiration.  The Event Coach convention/events business would come back.  She wanted to buy.

She dipped into her nest egg to come up with healthy first payment, then negotiated a deferred, multi-year payment plan with Mark, set to trigger in June 2022, with a pledge to retain all his employees for a 12-month minimum.  He agreed.  They arranged to tell their employees via Zoom, the deal was effective January 2021.  Christy, worked ahead with her and Mark’s managers to re-book all the client events in both portfolios, offering a two-year management commitment for 75% of a two-year event management price.  They were able to retain 80% of both her and Convention Services’ clients.

Serendipitously, the virus count was much lower during the resurgence, and less public anxiety in the summer of 2021 when the warm weather returned.  Christy had acquired a host of new clients, doubled her workforce and was poised to move forward with the launch of a new destination wedding line of business.

Finally, in December of 2021, the CDC announced that the long-awaited approval of a multi-national, multi-company Coronavirus vaccine was complete and the  vaccine would be available to the public in early 2022.

Your Four Scenarios—Create and Manage the Plot to Your Story
Now it’s your turn.  You’ve read the abridged scenario examples above (1 ½ to 2 pages per scenario is typical).  Hopefully these hypothetical examples have given you a sense of how to create your own plot-lines and stories filled with expected and unexpected events and developments that may affect your organization during Coronavirus Pandemic Recovery.

Now, engage in the process.  Assemble a team, do the internal and external data-gathering, identify 3-4 primary plots, then write.  Share the drafts and then fine tune them as a group.  Make sure to include the triggers, metrics and maxims in the plots that will serve as your guide if certain things happen externally and/or internally.  Don’t be all peaches and cream.  Scenarios often follow three primary plot lines:

  1. More of the same, but better
  2. Worse (decay and depression)
  3. Different but better (fundamental change)

Lastly, force yourself to create a basic financial model for each of your scenarios (you can use the Cash Flow Projection Worksheet in Part Two of this series).

Ready?  What are your titles?  What’s your story?  What are your four imagined Coronavirus Recovery Futures?

  • The V—The Quick Rebound (3—5 months)
  • The U—The Gradual Restoration (6—12 months)
  • The Swoosh—The Slow Renewal (12—18 months)
  • The W—The Resurgence (8 months growth, 4 months virus resurgence, 8 months economic resurgence)

Plan, Act, Assess, Adjust:  Lessons from Your Coronavirus Recovery Scenarios
We don’t know what is going to happen next.  That’s why scenario planning is such a valuable tool in times like this.  “Scenarios do not provide an accurate picture of tomorrow, but instead liberate the individual and corporate view of reality to make better decisions about the future.” (Schwartz).

We are not trying to predict the future; we are trying to prepare for the future.  Treating each scenario as a potential reality, in which you must prepare for and address unexpected and uncertain developments will strengthen our organization.  It is the process of researching and developing the scenarios that is of most value and importance.  It teaches us how to “suspend your allegiance to your official future” and think creatively about how we’ll meet the challenges presented to us.

Scenario planning prepares leaders for real world change.  It equips them, makes them more nimble, less afraid of thinking outside of their organizational box.

As the Coronavirus Pandemic subsides, and people turn their attention to Coronavirus Recovery, don’t close your war room/nerve center.  Maintain your rhythm of meeting and accountability.  Monitor and manage the season of recovery, and behave strategically.  Don’t merely react to what the virus and the government (local, state, federal) hand you.  Think strategically about how you can leverage this time.  Remember the Rahm Immanuel quote, “never waste a good crisis”?  That’s not a joke.  If at all possible, leverage change for your growth.

Use the virus and its effect on your organization to ask and answer hard, thoughtful questions about your enterprise:

  • Did the pandemic help us identify what’s essential to our organization?
  • Did the pandemic help us tell each other the truth?
  • Did the pandemic help you think about the organization as a whole instead of just your area of oversight?
  • Did the pandemic encourage you to brainstorm more effectively?
  • Did the pandemic make on-line work a permanent part of your culture?
  • Did the pandemic force you to understand the importance of liquidity and cash reserves?

Friends, use the scenario process to identify lead measures, metrics and maxims to monitor in the weeks and month ahead.  Keep regular watch on these well-chosen quantitative and qualitative marks and track where your organization is.  As things unfold, exercise your newfound ability to anticipate and prepare for external uncertainties, and then choose to act, retreat or advance.

Lastly, there will come a day, when you come to the realization that you have arrived at new normal.  Just like the subtle conclusion of the Great Recession, so too the Coronavirus Recovery.  When that day comes, I hope you will pause and tell your story.  Talk about heroes and sacrifices, and remember that small group of leaders who crafted a series of scenarios that helped you navigate your way through pandemic.  And I hope that very soon, that same team is somewhere assembling a set of scenarios to explore the possibilities and probabilities of the next big thing for your organization.

May God bless you and your work!

David Alexander, President
Alexander Resource Strategies

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