Amin Rammal, Director, Asiatic PR, on why organisations must reassess the way they are structured and managed

Constant technological disruptions, fluid geopolitics and economic shifts in changing global scenarios have challenged decision-making and planning for decades. The continuous change is compounded by the interconnectedness of people, institutions and society which create unpredictable disruptions – good and bad. I focused on this in my article titled Life in Beta, published in Aurora a few months prior to Covid-19. The pandemic, however, is an exception in the scale of impact and complexity without a parallel reference in recent times. It has further accentuated the need to embrace the uncertainty in conducting business and making decisions. There are several ways in which organisations can manage it.

Agility, Focus, Convergence

Organisations need to reassess the way they are structured, managed and operated. While there is a need for flexibility within the organisation, it is important to ring-fence the parameters for change within the defined purpose. New opportunities appear to decision-makers like shiny objects and saying no is even more critical than saying yes. Convergence enables actions through the sharing of information and collaboration and drives the process that guides action. This type of thinking is as much culture as it is structure. It needs to be embraced at the core of the company. In his article in the International C2 Journal (Vol. 1, No. 1, 2007), David S. Alberts, in reference to shift in warfare, describes this best: “Agility is the critical capability that organisations need to meet the challenges of complexity and uncertainty; focus provides the context and defines the purposes of the endeavour; convergence is the goal-seeking process that guides actions and effects.”

An example illustrated in the same article suggests how to shift from a Command and Control (C2) driven organisation to an Edge Organisation through the distribution of information, patterns of interaction between people/divisions/institutions and the empowerment to make decisions. Many new technology-driven organisations through their networked, collaborative model have already made the shift. Legacy cultures need to embrace this new reality to compete in the Information Age.

Information

Information is critical and its pervasiveness within the organisation determines how quickly it is processed and available for decision-making. In times of crisis with no precedence, information drives effective scenario planning and refinement. It helps to reduce the risk of choices which need to be made. Companies which have leveraged technology to develop a direct relationship with their customers are in an ideal position. In the early days of Amazon, the company used to face criticism for investing in acquiring customers at a loss. Today, the strategy stands vindicated. Data has been touted as the new oil but contextualising it to drive insights is the critical ‘refinery’ process which makes the data actionable. It helps understand and influence customers who have been at the core of marketing and branding since inception. Technology has enabled brands to become closer to their customers by collecting, analysing and using first-party data to innovate and personalise products and experiences. And customers have been willing to share their habits and behaviour in exchange for the utility they receive. To use this privilege effectively, a culture of experimentation needs to exist for testing and learning. Those who have embraced this approach are intrinsically managing uncertainty all the time through iterative development processes. Digital allows for unprecedented tracking and use of data to tailor experiences in real-time.

People

For some industries, Covid-19 has changed how companies and consumers operate. Professional services have been able to take advantage of WFH in light of restrictions on travel and physical interaction. Digital transformations have been expedited to embrace the ‘new normal’. According to a recent survey of business executives around the world conducted by McKinsey, “85% of respondents said their businesses have somewhat or greatly accelerated the implementation of technologies that digitally enable employee interaction and collaboration, such as video conferencing and file sharing. Roughly half of those surveyed reported increasing digitisation of customer channels; for example, via e-commerce, mobile apps, or chat-bots. Some 35% have further digitised their supply chains, for example, by connecting their suppliers with digital platforms in supply chain management.” Some changes are ephemeral while others are structural. The survey findings indicate that across all sectors, “15% of executives surveyed amid the pandemic said at least one-tenth of their employees could work remotely two or more days a week going forward, almost double the eight percent of respondents who expressed that intention before Covid-19.”

A structural change which organisations need to build in (if they do not already have it) is investment in learning and development. The World Economic Forum recently declared a “re-skilling emergency”, as the world faces more than one billion jobs transformed by technology. It is now even more pressing given the acceleration in digital transformation. Low-cost labour is no longer a sustainable competitive advantage as automation substitutes processes. Quality and innovation are needed to compete. The pandemic has made it more urgent to build skills to keep up with the transformation or manage new ways of working. Both executives and employees must continually refresh their skills. Learning is not just the responsibility of the organisation, it is also incumbent on employees to take the initiative for their growth and job security. The drive for self-learning is a critical driver of future success. Companies can help inculcate it through an environment fostering curiosity and experimentation. Effective learners actively seek to learn and experience new ideas. They plan their learning.

Cash Reserves

The pandemic has severely impacted economies. Businesses that have survived, particularly traditional ones, have seen their margins and cash flows erode quickly. In such situations, companies that kept reserves are better able to manage the pressure and take advantage by investing in new opportunities. They have also been able to accommodate customers who were adversely affected by accepting longer payment cycles. The framework in Figure 1 by Deloitte demonstrates the various positions a company can find itself based on the impact of a crisis like Covid-19 on their business vis-à-vis its liquidity.

In a crisis, businesses need to quickly assess their position, simulate scenarios, make decisions and implement quickly. And constantly update the scenarios as new information comes in. In the process, they need to involve multiple stakeholders to get diverse perspectives as crises, such as Covid-19, have many unknowns. But always make decisions.

“In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing and the worst thing you can do is nothing.” – Theodore Roosevelt, 26th President of the USA.

Amin Rammal is Director, Asiatic Public Relations. amin.rammal@gmail.com

Nasir Jamal cautions that the economic fallout of the pandemic may not be over yet.

It has been roughly eight months since Covid-19 sent shockwaves through Pakistan’s economy. In an economy already facing strong headwinds and reeling under the pressures of harsh stabilisation policies, the global pandemic brought about a crisis like no other.

The economy came to a screeching halt as the rapidly increasing number of Covid-19 infections forced the government to put Pakistan under lockdown, close borders, shut down factories and businesses and ban large public gatherings to stop the spread of the virus. Only essential industries and services were permitted to stay open as citizens were ordered to remain at home to avoid catching the disease.

Consequently, Pakistan’s economy shrank by 0.4% for the first time in 68 years, exports plummeted, tax revenues shrunk, thousands of micro, small and medium sized enterprises (MSMEs) – mostly in the informal sector – suddenly went out of business as demand for goods and services collapsed. In fact, MSMEs were among the major victims of the outbreak as they lacked the financial backup necessary to support them as well as the managerial capacity to tackle and sustain supply chain disruptions and declining demand for their goods and services. Millions of workers found themselves out of jobs and below the poverty line.

The health crisis plunged Pakistan into a deep recession, affecting virtually everyone – some more than others – and struck the economy at a time when it was struggling to recover from a major external sector crisis that had seen the country go back to the International Monetary Fund (IMF) for its 13th bailout since the late eighties. The economic crisis also brought the cash-based informal sector to a complete halt. The hardest hit businesses were clearly the ones that depended on large groups of people coming together at one place such as cinemas, hotels, restaurants, airplanes and so on. The automobile sector and the multiple industries related to construction were among the major losers as were textile exporters. All suffered massive losses during the last quarter of the previous fiscal year as domestic and foreign demand for these products bottomed. Mercifully, however, the recession proved to be short as the virus largely spared Pakistan, unlike the rest of the world, and the government was able to lift the lockdown restrictions earlier than expected. A lot of credit goes to the government which announced a hefty Rs 1.2 trillion relief package to support different sectors of the economy and hand out cash to poor families to support them in their difficult times.

To support government efforts, the State Bank of Pakistan (SBP) implemented significant monetary measures to reduce the impact of the pandemic on businesses. These included a reduction in the policy interest rate from 13.25% to seven percent, low-cost loans for firms to pay salaries to their employees, and subsidised long-term investment loans. SBP also allowed loans to be restructured to avert defaults and keep the balance sheets of the banks healthy. In fact, a sizable number of industries and other businesses might not have survived the pandemic without the measures taken by the SBP even if the majority of MSMEs from the informal sector were unable to take advantage of these initiatives.

More importantly, the increase in the inflow of multilateral dollars to help the country fight the pandemic created space for the government and the SBP to implement fiscal and monetary measures to shield the economy and businesses from the negative effects of the outbreak.

Now, with the worst possibly behind us, it will be premature to expect the economy to recover from the impact of Covid-19 quickly. Many in the government would like us to believe that the economy and businesses are out of the crisis as is indicated by the short-term economic trends for the first quarter (July-September) of FY 2020-2021. Yes, the construction package announced by the Prime Minister has buoyed sales of cement, glass, steel and other construction-related industries. Textile exports, barring garments, are rising. The automobile industry has bounced back with the swift increase in the sales of cars and motorbikes. The stock exchange has gone back to pre-Covid-19 levels. Other sectors of the economy are also catching up. However, the economy is yet not out of woods and a complete recovery is forecast to take a longer than expected time.

Like other multilateral lenders, the World Bank also sees an anaemic, fragile economic outlook for Pakistan for at least two years, predicting the growth rate to recover by just 0.5% in the ongoing financial year. This compares with the targeted GDP (gross domestic product) growth rate of 2.1 per cent that the government had set for the present year.

Even this forecast of economic recovery is predicated mainly on the absence of infection flare-ups or subsequent waves that would require further lockdowns. The World Bank has also predicted a substantial increase in poverty in the wake of lacklustre growth recovery.

Another major threat to quicker recovery stems from the resumption of the stabilisation policies as the government and IMF negotiate the revival of the six billion dollar bailout Extended Fund Facility (EFF) programme that was suspended when the pandemic struck in March. The resumption of the programme will force the government into tighter fiscal measures and the SBP to raise its policy interest rate which is in the negative territory at present, with monthly headline inflation hovering around nine percent compared with the discounted rate being held down at seven percent for the moment.

For now, we may think we are done with Covid-19, but we are not. The number of infections has started to rise in the major cities, spawning fears of another lockdown and economic shutdown if the situation gets out of control during the winter. The new wave of Covid-19 may appear to be not as bad as the first one. But are we prepared for, or can we afford, even a milder wave? Don’t think so.

Nasir Jamal is Chief Reporter, DAWN Lahore. nasirjamal65@gmail.com

The New Normal will bring with it an entire new set of leadership attributes, argues Leon Menezes.

Leadership has been a multibillion dollar business for some time now. With books, seminars, podcasts, and executive courses at top universities around the world, why do we still have a dearth of it? Leadership models and definitions abound as do theories of motivations. Perhaps they are coupled and inseparable?

In my view, leadership is “What you do in a given situation to achieve desired outcomes that are acceptable, defensible and sustainable.” As we have seen time and again, what may have been acceptable today does not hold out too well in the future. Or, as Peter Senge, a senior lecturer at the MIT Sloan School of Management says: “Today’s problems were yesterday’s solutions.” The ‘attributes’ of leadership qualities for a long while reflected prized male qualities that emerged through centuries of military and clergy models. Since then, a more inclusive environment has come into being with more women in the workforce with the result that we are seeing a different set of ‘desirable’ traits. Perhaps this is why countries with female leadership have done better during the Covid-19 crisis.

Leadership is a lot more than having followers and issuing orders. We are aware of ‘building shared vision’, strategy, communications skills and courage. However, all this is intertwined with the nature of the organisation, its industry and the demographics of the workforce within. How can we forget our customers and business partners in all this? Two things have emerged strongly because of the ongoing pandemic. Work delivery is relying more on communications technology and employees WFH. Leadership will now have to traverse these two dynamics in order to be effective in the future.

Let us start with ‘trust’. In the traditional workplace, employees were overseen by line managers who may (or may not) have had a line-of-sight. ‘Clocking-in’ and ‘clocking-out’ was still a requirement in a majority of organisations (although going home on time was not guaranteed). Progressive organisations changed their approach to focus on employee productivity, as opposed to monitoring their physical presence. Many allowed WFH to select staff, based on the nature of their work. So what happens to leadership behaviours (and we include supervisors and managers here) who seemingly have to give up some of their control? Perhaps not surprisingly, companies have installed software on employee laptops that can monitor the hours logged in, actual work done, and websites visited. The endless Zoom meetings require attendees to keep their cameras on so that one does not goof off. In fact, even teachers have to resort to ‘control mechanisms’ to ensure attendance and participation. All this may be fine to a degree that we are learning as we go along. Perhaps controls may be relaxed as we shift focus to ‘productivity’ as opposed to ‘activity.’

However, the more challenging aspect will be to engage with employees at a more personal level; making sure that the ‘whole human’ is involved. In an office environment, we often engage in small talk, share news about what may be happening in our lives and celebrate with colleagues on personal milestones. WFH may make this kind of engagement by line managers seem a bit intrusive unless one has established some sort of a relationship. Induction programmes need to be structured carefully as it would be easy for a newcomer to feel abandoned. A traditional induction would have a lot of friendliness and warmth as the new joiner is introduced to colleagues, seniors and the lunchroom. Similarly, customer and supplier relationships also need nurturing.

Since it seems that the pandemic may last well into the next year, these interim measures may be sufficient. However, there is much talk globally about “never going back to the way work worked.” The implication seems to be that companies and employees are keen to keep this distance going without realising the tremendous impact on company culture and identity. In this situation, we would be reduced to mere functioning components as opposed to participative employees. From my experience over the past few months with online and hybrid teaching, I see the difference in how relationships are formed with students who are present; how cross-talk and laughter (along with smiling faces) brings vibrancy to classrooms; how just a cheerful “Good morning, Sir,” charges the human in me. A brief chitchat at the end of class is a wonderful tonic to end the day. For those who choose to do their classes online, there is nothing to connect them with me except a Zoom link!

Leadership models evolve to address the complexities of the modern world. The speed of change as a result of technology was a challenge anyway and we now have a world in semi-lockdown adding pressure on industries and their leaders. The competencies (skills and behaviours) for the future will have to encompass a wide variety of ‘new ways’. According to bestselling author and speaker Jacob Morgan’s latest book, The Future Leader, you will need the mindset of a global citizen, servant, chef and explorer; and the skills of a coach, futurist, technology teenager, translator and Yoda. Morgan based his findings after he interviewed more than 140 top CEOs from around the world about the skills and mindsets required for the future.

Uncertainty has been with us since our days as ‘hunters-gatherers’, never knowing if we would eat or be eaten. In a sense, not much has changed, except we now have more sophisticated tools and resources with which to respond. Good luck! n

Leon Menezes is a professor-of-practice at IBA Karachi.

South Asia sits between two great regional groupings and this will have significant implications for marketing and communications, Covid-19 or not, writes Julian Boulding.

Like all of South Asia, Pakistan sits on the fault-line between the two great regional groupings of the world: ‘The West’, which we can define as EMEA and the Americas and ‘The East’ which we can define as the countries of Asia Pacific. Others in this issue may have written about the West – I shall focus on the East. There are three key factors.

Accelerated Change

It can be said that Covid-19 has changed the world. The evidence is all around us. Restrictions on travel and social activity. Economic downturns. The shock of losing friends, colleagues and loved ones to a terrible and unfamiliar disease. But like all pandemics for the past thousand years, Covid-19 will pass; vaccines are in development and once they are available, the costs of distribution are relatively low. Bill Gates recently estimated these as $62 billion – the Gates Foundation could fund these from its own resources alone. When the pandemic passes, much of human society will return to normal. APAC, where the disease first arose, was ‘first in and first out’ and provides a guide to what will happen to the rest of us. We saw months ago that the clear skies of Beijing soon became smoggy again as commuters returned to their cars. My own company, thenetworkone, recently hosted a webinar talking about remote working in agencies – our delegate from Hong Kong told us that all his colleagues were back working in their office, as were other agencies in his city. What has happened, in society generally, and in professional services sectors like ours in particular, is that Covid-19 has not caused long-term change, but has accelerated those changes which were already happening.

These include:

• The rise and rise of e-commerce and the decline of physical retail stores.

• Hybrid work patterns; a mix of remote and in-office working.

• More flexible working hours, aiding the assimilation of women into the workforce at senior levels.

• The adoption of digital communications technology: Zoom, Teams and other videoconferencing technologies (Microsoft’s decision not to alienate China seems very prescient).

• Improved health and hygiene awareness. The super-spreaders of Covid-19: maids, migrant workers, university students, air travellers, party-goers and centrally-controlled air conditioning were the same as those that spread SARS and presumably the annual arrival of the latest strain of influenza. The same learnings can be applied. Once we have dealt with Covid-19, we will be better prepared for Covid-23.

The Cultural Divide

What is truly a game-changer has been the divide between APAC and the rest of the world in terms of tackling Covid-19. Initially, some commentators saw this as a divide between the two world superpowers, China and the US. But clearly, it is a lot more than that. Throughout Asia Pacific, society’s response has been consistent. Closing national borders; locking down cities, states and whole countries; rapid test-and-trace activity to identify outbreaks and effective technology-based systems to prevent rule-breaking. Korea closed down the Church in Daegu and the gay clubs of Seoul. Japan cancelled the Olympics. Countries like Thailand and Vietnam whose economy depends on tourism, closed their borders. Westernised Anglophone countries with Caucasian populations (Australia and New Zealand) followed the example of China and Korea and Singapore, not the UK and the US. These strategies worked because the people in those countries voluntarily accepted highly intrusive restrictions on their personal freedoms and a complete over-ride of their personal data privacy. This divide is cultural: the mask-wearers and the non-mask-wearers, if you like. It is not a divide along the lines of politics, religion or colour. Like Germany in the eighties or Korea in the 2000s, both sides are looking over the wall to see whose system works the best. I know where my money is. If I were starting my marketing career in Asia today, I would certainly train as a data scientist, rather than as a government regulator.

The Economic Divide

Who said “culture eats strategy for breakfast”? East-West and West-East trade is no longer a driving force in economic growth. Increasingly, we see trade working within broad time zone groupings. Trade in goods is hampered by transportation times and tariff barriers. Who wants to ship a container from APAC to Europe (a six week voyage) when import tariffs may have changed by the time it arrives at the port? Trade in services is hampered by time zones: APAC, EMEA and the Americas have a maximum internal time difference of three to four hours. APAC and the US have typical time differences of 11 to 13 hours. Exporting and outsourcing benefits from the connectedness of people; not just wires and waves. The result for our business in marketing and communications will be a great deal more focused on intra-regional trade and brand development; think Alipay, Didi Chuxing or Grab. As for global companies, we will see the acceleration of local and regional autonomy in their business and brand management. By the time Covid-19 travel restrictions are lifted, the local management will surely have figured out how to run the business without Captain America arriving to save the day. As urbanisation (the principal driver of economic growth) continues to spread throughout APAC, Asia will of course gain GDP leadership. Two-thirds of the world’s population live there.

One Big Question Remains

What is the position of Pakistan and the other countries of South Asia? Or to phrase it another way: Is South Asia (home to almost one third of humanity), a part of APAC or more connected to the West? Traditionally, the West/East or Eurasian fault line runs through Turkey. But the cultural response of South Asian countries to Covid-19 has clearly mirrored the West, much more closely than the East. Which way does South Asia look? Recently, I heard a presentation (virtual, of course) by Parag Khanna, arguably the leading world authority on these issues. We tend to look at commerce in terms of goods and services. He looks at it in terms of people – specifically, the migration of people. Khanna sees the current migration issues as almost incidental. In his analysis, the pandemic is accelerating the decline of populist politicians, whose appeal is the creation of barriers to migration. Long term, he looks at them in terms of population demographics.

The majority of the world’s population are young, single, Asian, urban and childless. Countries with ageing populations will have a supply shortage of people of working age. Already, the median age of the population in the EU is 43; in China, it is 46. Whereas the median age of the population in South and South East Asia (2.5 billion people) is typically in the low 30s. There is a whole generation coming, where South and South East Asia will supply the world’s workforce to North Asia and the West. Which way will South Asia choose to look? Supply seeks demand. I think the West will have the greatest need.

Julian Boulding is President and Founder, thenetworkone. julian.boulding@thenetworkone.com

As the second wave of the pandemic takes hold, communicating to Covid-19 fatigued audiences will be nothing less than an uphill task, argues Zohare Ali Sharif.

"The single biggest problem in communication is the illusion that it has taken place.” – George Bernard Shaw. In any crisis situation, effective communication has to take the front seat. And if the crisis is a global pandemic, developing and delivering effective communication, customised to the need of the situation, becomes imperative. Crises create uncertainty, speculation, rumours, fear, depression, panic and even chaos. In Pakistan, both the government and the people were slow to react to the Covid-19 crisis. Initially, it was dismissed as another kind of flu. Then a belief was propagated that it only affects the elderly and people with pre-existing illnesses. Then came the contention that the virus cannot survive in hot weather and come summer it will all be over. And still, other disinformation was commonly accepted.

In a crisis, people urgently need accurate and timely information from authoritative and credible sources. If this is missing, speculation and rumours fill the vacuum. And this is what happened. Granted that Covid-19 came out of the blue and no one was prepared for it. Here, it must be noted that more often than not, crises do not suddenly happen; they are issues that are ignored or dealt with desultorily until one day something gives and the issue turns into a crisis. But, even given that Covid-19 came suddenly, the reaction was inordinately delayed.

The communications response to a crisis should lay out the facts truthfully, dispel misconceptions, provide reassurance and not least, inform the audience about the measures that are being taken to handle the crisis. Apply this rule to the Covid-19 crisis and evaluate whether the communication by the relevant authorities to the public at large and by companies to their stakeholders met these requirements and to what level. And was that communication delivered timely?

Ten months after the crisis started and a second wave engulfing many countries, the communication needs to evolve to respond to new challenges. What are those? What has changed in this period that corporate leaders need to take into account in their revised communications to their stakeholders and especially their employees? Here are three ways the situation has changed.

Firstly, the dread and fear of the early days has given way to people not caring anymore. They have had enough. In many countries, people are even revolting against restrictions and abandoning basic safety practices. This is a matter of concern as it can make the second wave more intense and longer lasting. Secondly, many people are mentally stressed as the pandemic has meant lost jobs and livelihoods, burgeoning personal debts, domestic tension, disrupted lifestyles and schedules ranging from children’s education to marriages, to travel and more. Thirdly, the novelty of WFH and online virtual meetings has worn off. How many online video conference calls can one take? Some companies have resumed work from the office, but if the infection rates rise sharply in the second wave, one can expect WFH and lockdowns to be in place again. Even now, companies that have resumed work at office are still holding meetings and interacting with external people online. This has resulted in declining motivation and productivity, and the onset of boredom and frustration.

The function of communications is to address these changed realities. The objectives will vary from one organisation to another, depending on the nature of the business, the size of the workforce, the level of negative impact of the pandemic on the business and so forth. However, broadly speaking, the primary objective should be to make people accept that the pandemic is not over and a second wave is upon us, and everyone needs to find the inner strength to cope with this and continue practising safety measures, tedious as these may have become. The messaging should include authentic updates on the progress of vaccine development and emphasise what everyone can do to build up natural immunity through consumption of the right foods and regular exercise.

Communication needs to keep motivation up, counter stress and give calculated hope for the future. People need hope and feel their future is secure. To this end, the messaging can recall good times and past achievements, share future goals with employees and emphasise that everyone’s support is critical in achieving these goals. On the lighter side, the communication needs to recommend ways to vary daily routines and suggest home and family based activities that can be taken up after work.
Another part of the communications strategy is to rethink how the messaging is delivered. For instance, the virtual meetings through conference calls involving all employees or large groups of employees resorted to in the preceding months should be replaced by smaller, more intimate group calls of less than 10 people, so that interactivity is higher and everyone is encouraged to participate. People also need to feel that their company cares for them as individuals. In addition to shifting to small group calls, management should schedule one-on-one calls with employees if all are still working from home or one-on-one meetings if everyone is back at the office. Obviously, for companies with a large number of employees it may be impossible to have such one-on-one calls or personal meetings with each and every employee. For this purpose, the management needs to develop internal leaders to take on the responsibilities of personalised individual interactions with employees. The CEO cannot and should not be the lead voice all the time. Departmental and functional heads need to emerge as leaders, not just to discuss work, but to cascade the motivational messaging. This will not only allow more one-on-one interaction with employees, it will also develop a second tier of leaders, who themselves will be motivated by the satisfaction of motivating others. More can be done. The idea is that the communication with both internal and external audiences needs to change in terms of content and in the method of delivery. Professional PR agencies are equipped to work out in detail such communication strategies that are customised for each organisation.

Zohare Ali Sharif is CEO, Asiatic Public Relations Network. zohare@apr.com.pk