Thoughts From The Bunker – Leadership, Agility and Innovation – Yesterday, Today and Tomorrow

This week I have been chatting to many of you around the subject of leadership and structure within your businesses and how resilient and fit for purpose they seem in response to the current situation, with the aim to gain a better understand on how to position our own business going forward. This has thrown up some interesting conversations on what our US friends like to call Human Capital strategy (!) specifically around leadership and structure for recovery to address whatever the new market will throw at us. So definitely a little more self-interest but again, these are reflections from the market not a naked pitch, so please take in the spirit it is meant!

As we seem to have reached something of a status quo in current operations with an understanding of where business is for good and bad, conversations are increasingly turning towards a recovery phase. Although we are not yet there by any means, thoughts around what is required to bring the business out of lockdown and to be one of the firms that can benefit from the illusive V shaped recovery and avoid the uncertainties of the infamous W, are creeping up the list of things to do! Discussions with the client, as highlighted in my last note, focus around innovation and agility – words which are often used but seldom acted upon in our industry. This was brought to light for me when I worked with a fantastic automation company looking for a new CEO to take it to the next level without losing the ‘secret sauce’ in their culture. The outgoing CEO said that the key distinction was that they were a ‘Technology company that happened to work in Defence rather than a Defence Technology company’. I pushed him on this and the simple example he gave me was that when working with a prime, if they hit a problem a series of meetings went into the diary over a number of weeks to examine the problem. His approach would be to lock the team in a room and push Pizza under the door until a solution presented itself! Doubtless the next phase will be won by innovation, customer focus and the ability to react with speed of thought, word and deed as the customer looks at the wider world for solutions to the next generation of problems.

So the next question is do you have the right leaders in place? This extraordinary situation is sending businesses through several phases in their corporate development in a matter of months. ‘Business as usual’ leadership is largely focused around operational delivery and many of the current cohort have come up through program management and are highly capable in this regard and have done well in marshalling resources. However as we look at the recovery phase we are entering a market where everyone is questioning the norms and firms will have to adapt or be left behind. This is going to require a different type of leader, one with a far greater customer focus who can find and drive growth. It’s no great surprise that when engaged in searches I’m increasingly seeing a differential in compensation between those with a client facing or BD background and strong client connectivity versus those with a more inwardly focused career path. Add to this the fact that we now need to find individuals with a more entrepreneurial mindset, those who can look at the current abilities, capabilities and catalogue and create opportunity utilising their relationships to the benefit of the firm. They are few and far between. Thinking needs to change and words such as agile and innovation need to be embraced and lived rather than just words in every brochure or presentation!

That required agility leads onto staffing. IR35 aside, (and it will be back!) firms need to look at how they staff their operations in the most cost effective and efficient manner. Utilisation rates have always been a hot topic of conversation with managers judged on their ability to keep everyone on a client task. However the customer has increasingly showed that they will procure services on a more flexible basis a trend that is set to continue and expand. Therefore staffing models need to reflect this with a more flexible approach and a sustainable mix of permanent and contract/freelance staff. New technologies and systems require specific skills that won’t exist in your current workforce and by their nature have a very specific life expectancy. Building dynamic, legally compliant talent pools, ‘active’ relationships with specialists, tracking their availability, knowing their day rates etc, will become key to acting with speed and agility to become a customer’s first call. Could you work with industry partners to access each other’s ‘under utilised bench’ aiding both parties with cost and availability? Alternatively, could you build common talent pools sitting in between various partner companies, supporting the Prime and their Subs in pursuit or execution of a program, ensuring that you don’t drive up market prices by chasing common skills? These are all areas that need investigation to achieve that agility and speed of response to succeed and capitalise on opportunity.

One area that has also been highlighted on a number of occasions is a need to fully understand the skills you already own within your current workforce. The pausing of programs and general lack of activity has meant that staff have found themselves furloughed or in some cases made redundant. In many firms what has transpired is a lack of any comprehensive system to understand the skills at your disposal and therefore internal mobility has not been effective. As programs come back on line and staff are required back on task, do you have the knowledge and systems to fully understand the skills within those staff members to ensure that we bring back the right personnel at the right time in order to maximize returns? Internal teams must ensure that systems are up to date and actively managed to maximize the resources you are already paying for! What transferable skills exist and with retraining could they be redeployed and would that be more cost effective and culturally beneficial that going to market? As part of your refocus ensuring your team can provide you with an accurate and comprehensive picture of what you have at your disposal is key and in many cases has been found wanting.

As mentioned, leadership teams are flat out juggling the many and increasing demands that Covid has thrown up. However it is clear that thoughts are already turning to lesson learnt and the shaping of the business to react to the market and that will take some thought and tough decisions to produce a business that business that is fit for role in the next phase of the market.
“It is better to fail in originality than to succeed in imitation.”– Herman Melville

SVE