Eight Ways To Emerge Stronger From The Crisis

With the pandemic easing, it’s time for businesses to square their shoulders and aggressively move toward a digital-first strategy, says Paul Roehrig, Head of Strategy at Cognizant Digital Business & Technology.

The COVID-19 pandemic has taken millions of lives and triggered trillions of dollars’ worth of economic wreckage. And while news regarding vaccines is encouraging, now is not the time for the world to turn its back on safety measures proven to help slow the spread of the virus.

Nevertheless, vaccines are taking hold at various rates worldwide, and there is every reason to believe the grip the coronavirus has held on the world for over a year is easing.

Early in the crisis, we explored steps businesses should take to eventually emerge from the pandemic in a strong position. We believe that advice has held up, and that now is the time for forward-looking companies to accelerate digital initiatives.

Eight ways to catalyze post-crisis gains:

A year ago, “becoming digital” was seen by many as a desirable elective, but now — in our new world — it’s mandatory. The most common questions from business leaders from every industry and region have been: “I get the theory, but where do I start? What specific steps can I take today to ensure a healthy tomorrow?” These eight critical tactics will help:

1) Modernize data

It’s more important than ever to turn data from a liability into an asset. Companies that haven’t gotten control of their data are already behind, and the new economy will make it harder to recover. It’s no longer justifiable to pay to maintain terabytes (or more) of data and then not use it for business outcomes.

Improving decisions and experiences — and growth — with applied intelligence is infinitely more difficult (or impossible) without data that is relevant, accessible, secure and used to improve decisions or customer experiences. A data audit — figuring out what data is available, being accessed and for what purpose — was a no-regret decision 13 months ago. Now it’s a condition for survival.

2) Unshackle from legacy applications 

Roughly $3 trillion of economic value per day still runs on COBOL. That’s a staggering reliance on a programming language dating back to 1959. Going forward, business pressures will make it unsustainable to be trapped by this heritage software. Consumer relevance, faster time-to-market and cost savings have never been more important.

Many companies feel trapped by their legacy software, but there are new tools, processes, engineering methods and partners to help unlock value that is trapped in data centers. The first step is a complete software audit to understand which applications make the most sense to modernize, which should be left alone and which can be turned off.

3) Modernize how employees work

Remember going into an office? Getting on a train? The TSA pat-down? We’ll do all that again, but ideas and practices about how we work together will never be the same. The pandemic shock accelerates the imperative to be able to work from an office, the home, the car, the … well, anywhere! Today’s employees seek the same high-quality experience as a consumer using the best software.

Old, difficult-to-use interfaces and systems hinder how employees interact and collaborate, and store and exchange information. Seamless, secure connections across web, mobile, voice, collaboration systems, platforms and processes have made great strides during lockdowns. We aren’t going backward, so the time is now to extend the modern employee experience.

4) Modernize consumer experiences

In just a few painful weeks in 2020, elegant, secure, scalable online content and commerce went from critical to essential for every consumer-facing industry. Content has always been important, but with more transactions online, the ability to deliver that content to the right person, at the right time, in any place, via any device, via beautiful software is now and forever a business imperative.

Regardless of industry, expectations for engagement have shifted. The immediate reaction for too many businesses was to throw cash at front-end consumer-facing apps. A better bet is to take a step back and understand how the lifecycle of demand can be changed longer-term. That starts with deeply understanding how human wants and needs are likely to unfold in line with specific products and services.

5) Engineer software for the new economy

Every modern business needs software that can be built quickly and scaled effectively to deliver modern (human-first) experiences across the value chain for employees, partners and customers. It’s not necessary to be better at software engineering than Google or Microsoft, but it is necessary for every company to become more software-centric.

Tools, engineering methods and technologies already exist to help an enterprise become a better bank, a better insurer, a better retailer. This requires rethinking how core IT teams are structured, how they work and how they are incented, plus reevaluating the partner ecosystem critical to the business. Every major company is building software all the time, but it’s now time to explore new methods. Starting small can show near-term progress while mitigating risk.

6) Virtualize core work

The total impact of the COVID-19 pandemic will take years to become clear. However, one irrefutable shift is the new requirement for companies to modernize core process work. Middle- and back-office work that is slow, labor-intensive, expensive, opaque and unchanging is no longer allowable. Nearly every organization we know of can improve supply chain management, HR, finance and industry-specific process work.

Notably, the pandemic unlocked virtualized medical care as medical workers used technology to provide at-home solutions or even in-hospital solutions more safely and effectively. And that’s just one example. Automation, applied intelligence and worker enhancement have all moved from “helpful” to “critical” during the COVID crisis. Now is the time to begin exploring which points on the value chain make the most sense to modernize today.

7) Modernize the cloud foundation

For years, IT has been chipping away at costs by moving work to service providers and pushing centralized computer loads to the cloud, but that was really just Phase One. The unprecedented economic downturn has shone a spotlight on how much more can be done, and how rapidly. Threadbare arguments against reducing IT costs — e.g., by more aggressively moving into the cloud, deploying cost-effective software-as-a-service platforms, reducing operating costs of non-core work – must be overruled. We recommend a pivoting from, “What can we move into the cloud?” to, “What can’t we move to the cloud?”

8) Make every space smart (and safe)

For years, sensor-enabling industrial equipment has improved productivity, reduced downtime and paved the way for more “as-a-service” business models. In the post-pandemic economy — as demand evolves and our expectations and concerns about staying safe in public spaces remain top of mind — nearly every company that operates in physical space will have to adopt the same philosophy.

COVID accelerated the development of technologies that assess occupant health and help us maintain safe distances, clean surfaces, etc. This takes a coordinated solution linking sensors, analytics and software. Business leaders must continue to be proactive in applying instrumentation, analytics and software engineering to make every space intelligent, less expensive to manage, more comfortable and safer.

To learn more, read our report “From Chaos to Catalyst,” visit the Digital Business & Technology section of our website or contact us.

Paul Roehrig is Head of Strategy for Cognizant Digital Business & Technology. He is the Founder and former Global Managing Director of the Center for The Future of Work at Cognizant. Along with Malcolm Frank and Ben Pring, he is a coauthor of What To Do When Machines Do Everything: How to Get Ahead in a World of AI, Algorithms, Bots, and Big Data and Code Halos: How the Digital Lives of People, Things, and Organizations are Changing the Rules of Business. Paul’s most recent work is Monster: A Tough Love Letter on Taming the Machines that Rule our Jobs, Lives, and Future, which he co-authored with Ben Pring. He can be reached at Paul.Roehrig@cognizant.com.

Source: Eight Ways To Emerge Stronger From The Crisis

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What You Should Know Before Going Into Business With Family

Some of the best businesses in the United States and around the world are owned and/or run by families: Aldi, LG Corporation, Ford, and Berkshire Hathaway, to name a few. These big-name companies started out as small ventures, and they prove that working with relatives or loved ones can be enormously successful if you approach the opportunity the right way. But if you’re thinking about starting your own company with people you love, first consider these points to see if moving forward will serve everyone well.

Related: 5 Keys to Successfully Leading a Family Business

Can you get everything in writing?

Years ago, my brother invited me to come work with him in a small oil and gas company. The deal was that we’d have combined investments operating in Oklahoma and Texas. He would be the engineer, and I would deal with sales and marketing from Chicago

Unfortunately, this didn’t work out. We didn’t hit oil in one of the main locations, and there was a huge disagreement about whether he had said I could have ownership in the business. We’d never put our agreement on paper which created a mess and a lot of hard feelings. In fact, the animosity was so bad that he fired me and we ended up not talking to each other for a full five years. We reconciled after our father passed away, but through this experience I learned just how important it is to clarify all terms — before you get started. 

Don’t assume that because you’re working with family you don’t need a contract or operations manual — or that you’ll sail through any conflict. On top of ownership, make sure to detail even little things like vacation and whether you’ll have an office. Setting expectations matters. In my case, my brother had expected me to track and inform him of all my daily responsibilities, and I felt like he was micromanaging me. So be clear about what everyone is going to do, how they’re going to do it, and the specific conditions under which you’ll take certain actions (e.g., expansion or closing down).

Find a third party to help you overcome biases 

All kinds of biases can interfere with how well you can run a startup or small business with somebody from your family. For instance, with my brother, we really had a hard time with anchoring bias. This is where you rely on the first piece of information you have. When we started the oil and gas company, we hadn’t lived in the same state for 30 years. So we took experiences we’d had with each other as kids and let them color what we thought it was going to be like working together. We quickly found out that we were very different people than we used to be.

Other biases can interfere, too. Some really well-known ones include confirmation bias, where you seek out information that confirms what you already believe, and negativity bias, where you’re more powerfully influenced by negative experiences than neutral or positive ones. When things start to go wrong, these biases can stop you from finding common ground and make problems spiral out of control.

So, you really need a neutral party that hasn’t been connected to you or your family members to step in and be an arbitrator. They can work out any differences based on what you’ve initially put in writing, and they can remind you that the most important thing in or out of business is the relationship. Find someone you and your family member both trust and then make sure they understand what role they’ll play in mediating any disputes. 

What’s pay going to be like?

I hate to break it to you, but good feelings of cooperation aren’t going to pay any bills for you or your family members. So you need to make sure right out of the gate that you’re able to pay everyone a wage they can actually live on. This is especially important when you’re just getting off the ground and need to support yourself with initial investments until the company actually turns a profit. Don’t allow compensation that’s subpar just because you’re working with a sibling or someone else you love. Know what’s fair in every role, and be clear in your written agreement about the financial point at which you’ll pivot, scale, or close the business. 

Related: When Our Son Was Born Nearly Blind, We Started an Eyeglass Business for Children

There are hundreds of companies operating today headed by families. To ensure yours will be a successful business, too, focus on these initial questions. If you have a solid answer for each of them and everyone is clear about the goals, you can create a legacy — and profits — for generations to come.

By: David Partain Entrepreneur Leadership Network Contributor

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How to Work with Family in Business- Patrick shares the different schools of thought related to this subject. Do you think it’s a good idea? http://www.patrickbetdavid.com Visit the official Valuetainment Store for gear: https://www.valuetainmentstore.com/ Previous episode: Why Big Networks are About to Collapse https://www.youtube.com/watch?v=B_s1g… Recommended episode: How People React to Crucial Conversations- https://www.youtube.com/watch?v=9-C_B… The Power of Daily Affirmations by Polet Sabetimani https://www.youtube.com/watch?v=QrlCJ… Follow Polet Bet-David Sabetimani on Facebook: http://on.fb.me/1UQtPQv Connect on Linkedin: http://bit.ly/1RQeEE9 Book Recommendation: Crucial Conversations http://amzn.to/1QAq5zz Valuetainment- The best channel for new, startup and established entrepreneurs. Schedule: New episodes every Tuesday and Thursday on a broad array of entrepreneurial topics. Have questions? Ask Pat! http://www.twitter.com/patrickbetdavid To see more videos from Entrepreneur Network partner, Patrick Bet-David check out VALUETAINMENT https://www.youtube.com/user/patrickb…

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5 Ways Family Businesses Can Adapt To Covid-19

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There are “unique challenges with a family business, particularly when it comes to making tough decisions in difficult times,” a friend of mine who runs a leisure and hospitality business with her siblings, wrote me this week.

I had sent her a note asking how things were going since the coronavirus shuttered the doors on a myriad of enterprises and I knew her industry was particularly slammed. She thanked me and said the question was a little “close to the bone.” But, she added, “Having a strong brand identity established by our parents has frankly been a beacon of light and inspiration during a very dark period.”

I decided not to press her about what the company has been faced with, knowing that the situation is very personal for family business owners. The repercussions of making tough professional decisions can have a lasting impact on family relationships. (For more on this and other advice for family business owners, check out Familybusiness.org, from the University of St. Thomas’ EIX, Entrepreneur & Innovation Exchange; full disclosure: EIX and the Richard M. Schulze Family Foundation are Next Avenue funders.)

“There is always this pressure in a family business to not be the one to screw it up.”

“This crisis is forcing family businesses to make trade-offs among objectives that would have previously been unimaginable — all while dealing with the complex dynamics of a family,” wrote Josh Baron (a partner and co-founder of BanyanGlobal Family Business Advisors) and Ben Francois (a principal there) in their Harvard Business Review article, A Crisis Playbook for Family Businesses. “But family businesses differ from other companies in that their form of ownership gives them the ability to take critical actions that could help them through these difficult times.”

A recent BanyanGlobal survey of family businesses found that 82% had seen a negative impact on their business from the Covid-19 pandemic at and about half of those said the impact has been significant.

(Read all of Next Avenue’s Covid-19 coverage geared toward keeping older generations informed, safe and prepared.)

During crisis times for family businesses, “family members tend to come together and do whatever it takes to promote the family’s health and prosperity,” says Kimberly A. Eddleston, a professor of entrepreneurship and innovation at Northeastern University and a senior editor on the EIX Editorial Board. “Opportunities for a family to come together and work towards a common purpose make the family stronger.”

The Advantage Family Business Owners Have

And that’s a distinct advantage that other entrepreneurs don’t have.

“Being a family business can be a real strength, because they can rely on family members to chip in where needed,” according to Eddleston. To harness the lessons of this crisis, Eddleston is gathering information through a survey of family business owners.

For more about how the pandemic is affecting family business owners and how these entrepreneurs can best adapt to it, I interviewed BanyanGlobal’s Josh Baron. Highlights:

Kerry Hannon: How do things look out there for family business owners?

Josh Baron: Most family businesses are stressed and filled with anxiety.

There is always this pressure in a family business to not be the one to screw it up. If you are the one running the business, you are feeling that pressure in a time when, through no fault of your own, it could go away.

What surprised you about your survey’s findings about family business owners and Covid-19?

You see examples of businesses with revenues dropping fifty percent or ninety percent. No one builds a plan with revenue going away to such an extent overnight.

How has the pandemic impacted family relations at family businesses?

Our survey shows a split between those reactions: twenty-nine percent have seen some negative impact on family relationships, while twenty-six percent have seen a positive impact (the rest have seen no change).

It’s understandable for those having negative reactions, because this is a stressful moment. If the decisions you are having to make are about laying people off and cutting salaries and cutting dividends, stopping projects — these have a real emotional impact.

But we also saw that this is a moment when members of family businesses come together, a rally around the flag effect, where it’s a sense of let’s put aside our differences and focus on saving the business.

How does having a mission or purpose help?

This does offer that kind of opportunity as a silver lining. We are seeing a lot of families coming together around the need to save the business, to save the employees, rescue as many careers as they can, to continue this legacy as something they really value and to come out the other side as strong as possible.

If you have a sense of purpose and here’s this mountain that we are trying to climb, here’s what we are trying to accomplish together, it helps you deal with all of the daily challenges, issues and stresses that come with working together as a family.

If you have something you value in the business beyond the financial results — maybe it is the impact on your community — you can create something that motivates and brings people together.

The Opportunity Offered by the Pandemic

Why is this an opportune time for family business owners to have conversations with other family members in the company that may have been pushed aside in the good times?

A real advantage of a family business is you are naturally thinking ahead.

‘I really want this business to last beyond me for the next generations, for my children and my grandchildren.’ That can be a very motivating effect.

Why are family businesses well-positioned to survive this business shock?

As a general rule, family business owners are making decisions not on ways that rely on results this quarter or maybe next year, but in being able to make investments that might not pay off for a year or two or even longer.

That generational approach and mindset can be really valuable in a time like this.

Unlike public companies, which typically focus on maximizing shareholder value, family owners value objectives that usually go well beyond financial returns — such as family legacy and reputation.

This period is an example of that ability to think over the long-term and realize that this year is going to be tough. We have to tighten our belts, cut our costs, cut our dividends, cut our salaries, but it will pay off in the long term.

We have also found that family businesses are able to make big decisions very quickly. That nimbleness is proving to be a real asset now.

How has Covid-19 helped get family members more involved in the businesses?

It is creating a fertile ground for bringing people into discussions that might otherwise not have been asked to participate.

For those who have been around twenty years and have been through other crisis points, they look at this as an opportunity to bring the next generation into the conversation and explain to them: ‘We made it through previous ones, here’s what you can learn.’

What are the obstacles in navigating Covid-19 that a family business might face?

When things go bad for a family business, it is not just in a professional sense, but in a personal sense. It intermingles and spreads over and there are no boundaries.

It can be very stressful. The business is on the line, careers are on the line. It can spiral out of control.

You need to press the pause button. Go back to the question: Why are we doing this? Hopefully, turn the moment into a positive way of improving relationships.

But the pandemic has the potential of making things a lot worse. It puts things on the table you never would have had to worry about, like that brother or cousin who is making a lot of money and not really doing anything. You might have looked at that as a cost of doing business. Now you aren’t able to afford that. Now, you have to deal with them in an environment when people are feeling really tense.

5 Tips for Family Business Owners During Covid-19

What are your five key pieces of advice for family business owners now?

Number one: focus on innovation. Don’t waste this opportunity to have a hard look at the way things are working. One retail firm we have worked with has always talked about having a more direct to consumer approach, but never gotten their eyes to focus on it. By necessity, a lot of the retail stores they have sold through have been closed, so they have had to focus on it.

Number two: start thinking about what your company will look like after this. How do we keep things going right now but put more energy on when we come out of this?

Number three: preserve cash. Cash is never more important than when you are in a crisis. Make sure you are taking steps you can to strengthen the balance sheet, so you can navigate through what is to come.

Around sixty percent of our survey respondents say they have reduced or shifted operating expenses to preserve cash.

Number four: live your values. Who you are as a company, and as people, comes out in the decisions you make in a crisis. As a family business, you want to make sure that you anchor yourself in that conversation of who you are as a family and what are the values we bring to this business?

Make sure the decisions you are making, if possible, are really reflective of those values.

I see in the families we are working with that they are making choices to keep employees or being generous in severance or helping employees find other jobs or repurposing them to other positions within the company rather than lay them off. It’s a more human approach.

Investing in people and communities is so much a part of who they are.

And number five: Communication is the most important part of making a family business work. Trusted relationships are one of the most valuable assets of a family business. In the absence of communication, people will draw their own conclusions — which are often negative.

A dialogue gives people a chance to share concerns and ask questions. It’s amazing how many family businesses that didn’t have any sort of platform like Zoom or Microsoft Teams became very adept at using it, due to necessity. Across the board, the comfort level has gone up and opened up communication better than before.

This will be a beneficial leftover of this crisis. Some of the comments we received from those participating in our survey include: ‘Covid-19 has brought us closer together for the time being, and we have put aside differences.’ And ‘We have seen greater family unity, with more concern for each other.’

Follow me on Twitter or LinkedIn. Check out my website.

Next Avenue is public media’s first and only national journalism service for America’s booming older population. Our daily content delivers vital ideas, context and perspectives on issues that matter most as we age.

Source: https://www.forbes.com

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On this episode of The Family Business Voice, Alfredo De Massis and Farida F El Agamy speak with Ramia about the global pandemic and its unprecedented impact on family enterprises around the world. Alfredo De Massis, Professor of Entrepreneurship & Family Business, Free University of Bolzano in Italy, and Lancaster University Management School UK, is an organisation and management scientist who specialises in family enterprise. Based in Italy, Alfredo is at the epicentre of the outbreak currently.
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