ECO­NOMIC UNCER­TAINTY? TIME TO THRIVE!

Manag­ing a team in times of huge in­se­cu­rity re­quires flex­i­bil­ity and grit. How can man­agers help staff and busi­nesses thrive amid uncer­tainty?

Finweek English Edition - - FRONT PAGE - By fin­week team ed­i­to­rial@fin­week.co.za

re­mem­ber when ev­ery­one had a fiveyear plan for their ca­reer? Th­ese days, only op­ti­mists take lunch to work. The rest are fully aware that a freak bout of re­struc­tur­ing could wipe out your whole depart­ment by mid-morn­ing.

We are liv­ing in un­easy times, where the lo­cal econ­omy is lurch­ing from one cri­sis to another and busi­ness is chang­ing at the speed of light. Volatile cur­rency and com­mod­ity prices are mak­ing it dif­fi­cult to fore­cast the next five min­utes, and teenagers in hood­ies are ca­su­ally de­sign­ing apps that could com­pletely de­stroy your com­pany’s rea­son for ex­is­tence. Mean­while, it feels as if the very fab­ric of the world econ­omy could be un­rav­el­ling as what many might call the most bor­ing peo­ple on earth (cen­tral bankers) are tak­ing mas­sive bets, and in­ter­na­tional ten­sions con­tinue to con­found. Also: Don­ald Trump.

The rate of change and the opaque busi­ness out­look can be paralysing. Con­stant job in­se­cu­rity and dan­gers from all sides can also have a pro­found im­pact on morale and pro­duc­tiv­ity.

How to deal with uncer­tainty:

Ac­cept the new nor­mal An unas­sail­able ob­sta­cle to suc­cess in uncertain times is the ex­pec­ta­tion that some­how things will “go back” to the way they were, says Judy Good­win, a change con­sul­tant and coach in Cape Town.

Con­se­quently, the big­gest threat to your com­pany is not a com­peti­tor’s in­no­va­tion or a new trend away from your busi­ness. It’s your de­nial about the com­peti­tor in­no­va­tion or the new trend. “Ac­cept that the sit­u­a­tion has been ir­re­versibly changed,” says Good­win.

En­cour­age and re­ward your team for bring­ing bad news early, and cre­ate an at­mos­phere where dif­fi­cul­ties and change are ac­cepted as a way of life, and seen as chal­lenges to over­come. De­featism is deadly. Make sure you have all pos­si­ble in­for­ma­tion to solve prob­lems and take ac­tion as soon as pos­si­ble.

We are liv­ing in un­easy times, where the lo­cal econ­omy is lurch­ing from one cri­sis to another and busi­ness is chang­ing at the speed of light.

Ride the wave Take ad­van­tage of the op­por­tu­ni­ties of­fered by times of great uncer­tainty. Your team should have the abil­ity to adapt con­tin­u­ously and learn quickly to max­imise fleet­ing win­dows of op­por­tu­nity as they be­come avail­able,” says Good­win. The writer and in­tel­lec­tual Nas­sim Ni­cholas Taleb calls this qual­ity be­ing an­tifrag­ile: “An­tifragility is be­yond re­silience or ro­bust­ness. The re­silient re­sists shocks and stays the same; the an­tifrag­ile gets bet­ter.”

For ex­am­ple, if your busi­ness is smaller than that of your com­peti­tor, chances are that you could move faster in adopt­ing a new tech­nol­ogy. Cap­i­talise on your com­pet­i­tive ad­van­tages as part of adopt­ing to new cir­cum­stances.

Re­place ex­pec­ta­tions with plans Clearly, blindly stick­ing to a strat­egy based on a de­tailed dis­counted-cash-flow anal­y­sis for the next 15 years is lu­nacy. No mat­ter how good your anal­y­sis, the fu­ture can­not be pre­dicted in such de­tail. How­ever, this is no ex­cuse not to get a firmer han­dle on the dif­fer­ent ways the cur­rent sit­u­a­tion can play out. Make sure you thor­oughly un­der­stand your mar­ket, make the most of clear trends and fo­cus on your clients’ needs and how you can solve their most dis­tress­ing prob­lems. And al­ways be pre­pared for the worst, and have a plan B(C, D and E to Z) in place. Even if ev­ery­thing works out, hav­ing backup strate­gies will bring con­sid­er­able com­fort.

Make peace with chaos Un­der­stand that you most prob­a­bly will be caught out by some un­fore­seen event. Make a list of all the things you can con­trol (top of the list: your re­ac­tion to events), and let go of things you can’t. Recog­nise that of­ten suc­cess has a lot to do with ran­dom­ness and luck. Also, know that if you make a change in one part of your busi­ness, it may have un­fore­seen ef­fects on other parts.

Stay hon­est Re­main open and give your team rea­sons to trust you. Don’t hide bad news, but re­main in­spi­ra­tional – help your co-work­ers to see the big picture.

Make huge amounts of hay when the sun shines Now, more than ever be­fore, man­agers need to

cel­e­brate all suc­cesses and make the most of good times – also by sac­ri­fic­ing some prof­itabil­ity to help them get through the dif­fi­cult years.

Be re­cep­tive Man­agers will get more in­for­ma­tion if they stop “lis­ten­ing to re­spond”, and change their per­spec­tive to try and un­der­stand al­ter­na­tive po­si­tions, says Good­win. “You may not agree with what your col­leagues are say­ing, but fo­cus on un­der­stand­ing why they are.”

Hire peo­ple who can deal with uncer­tainty and com­plex­ity In­creas­ingly, a high thresh­old for am­bi­gu­ity is be­com­ing a hot skill to have. “Nav­i­gat­ing com­plex­ity is not about re­duc­ing risk or pre­dict­ing the fu­ture. It is about build­ing ca­pac­ity within; the lead­ers, the peo­ple and the or­gan­i­sa­tion,” says Good­win.

In­creas­ingly, a high thresh­old for am­bi­gu­ity is be­com­ing a hot skill to have.

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