— by Mike Sharrow

I still recall the rosy outlook of the January 2020 ITR Economics forecast for US GDP growth of +2% and the talent wars associated with <4% unemployment.  The societal vertigo of Q2 2020 will be legendary and like a multicellular thunderstorm, it will be sometime before we’ll know when the overall eye of the crisis storm has passed.  A previous post on the 4th Industrial Revolution rightly highlighted the VUCA nature of the environment – with events like COVID-19 being shots of nitroglycerin to the already dynamic context.

When the first tsunami alarm bells went off of COVID-19 we leapt into forward-looking broadcast mode with a weekly cadence of “executive briefings” for what became a rapidly expanding audience.  It felt like launching a newspaper business (which gave me appreciation for real pioneers in that space) with the constant pressure of figuring out “the story” and then curating the news briefing for entrepreneurial audiences in actionable formats.  Like many CEOs, while I had the luxury of spending 4 months in 2019 building my 2020 operating plan, I built 4 new ones in 3 weeks as the tectonic plates of the marketplace shifted under COVID-19 pressures.  The leadership and consulting schtick of how the Chinese (ironic) word for “crisis” is equal parts danger and opportunity could not have a better exhibit!  

Within weeks it was evident that the great long-term risk of the virus are equally its co-morbidity diseases: fear, paralysis, despair, delusions of “returning to normal” and myopic survival focus at the expense of long-term strategic plays.  As hockey great Wayne Gretzky famously said, “I win by skating to where the puck is going, not where it is.” In late April we launched a rapid survey of lower-middle market CEOs across the US to get a snapshot of COVID-19 impacts and insights by geography, industry, size and other indicators.  In 2 weeks we captured 586 CEO responses with some insights such as:

• While 59% had NO knowledge of any COVID-19 cases in their social circles, 50% saw significant revenue decline

• Businesses in the $25-100M revenue range seemed to consistently retain/recover revenue at a superior rate

• Agricultural, Food services, construction, Engineering/Architectural sector businesses favored significantly better than other sectors

• Greatest challenges facing: Uncertainty (37%), Cashflow (25%), Profitable Revenue Growth (16%), Employee Care (14%)

• 90% the power of peers significantly changed their outcome

• 55% saw dramatic increase in employee ministry opportunities

• Despite significant revenue loss, 55% of companies found creative ways to retain or grow their workforce (often at ownership sacrifice)

• 34% had cash reserves for 1 more month of crisis, 71% could weather 3-6 months 

• 42% had identified innovations that would make their business stronger post-COVID19

• 12% launched new products to gain market share already in COVID19 environment

• 6% realized their “old way” of doing business would be obsolete in the new market 

• 27% seized opportunity to minister in the local community during COVID-19, 17% even ministering to their industry

• 60% are aggressively working on future business model plans

Looking at industries and states with variance begin to tease to where B2B entrepreneurs might shift customer targeting and product positioning.  The data was even helpful for the US Congress looking for “main street” business insight as they evaluate successive stimulus strategies.  

Uncertainty was the big zinger on the outlook, though. We used the idea of a “Tulip Tunnel of Uncertainty” play off the old “Strategic Inflection Point” paradigm to speak to the uncertainty haze leaders must press into.  VUCA is on steroids, so now what?  

Bob Johansen has written very helpful books (1 and 2) around pivoting from VUCA as a negative to a “VUCA Prime” framework.  As Will Mancini said recently, “You don’t fight the fire of uncertainty with elusive certainty, but with the fire of vision clarity.” VUCA Prime is about responding to Volatility with Vision, Uncertainty with Understanding, Complexity with Clarity and Ambiguity with Agility.  We’re finding that the VUCA Prime framework is a productive grid that combined with a balanced scorecard risk mitigation and opportunity identification discipline, can begin to bring the clarity needed to navigated uncertainty.

These are painful times for sure. However, as followers of Jesus, we have both imperatives and advantages to serve with power in this time.  Paul wrote to the young leader Timothy a charge (2 Timothy 1:7) to remember “For God has not given us a spirit of fear and timidity, but of power, love, and self-discipline.” This not a time for faith-driven entrepreneurs to bunker down and wait for the storm clouds to blow over.  The Gospel calls us to restorative, redemptive entrepreneurial engagement (great article) in shaping the emerging new reality.

What are the “gifts” we’re seeing from the crucible of COVID-19?

1. Resets. It wasn’t all roses before, it was just a better market. This is a chance to change things that needed changing.

2. Purpose Clarity. Why are you in business anyway? Why is the world better, people impacted, God glorified and how is the business part of an eternal impact story? If that was a tacked-on feature before, it’s a chance to invigorate purpose clarity and mission.

3. Gospel demonstration and proclamation.  We’ve seen more reports of workplace salvations, discipleship and compassionate care in April than any month prior. Crisis creates an opportunity “give an answer for the hope you have” and opportunities to love teams, customers and community is at an all-time high.

4. Busted Market Concrete. The old forms of market leaders is disrupted, so it’s opportunity for new models, products, players and classic “innovator’s dilemma” maneuvers

5. Pruning for Agility. There’s a growing class of resilient leaders who are not only surviving COVID-19 but have retooled and pruned the business for future orientation such that when the market winds return they will catapult. Some needed to “adjust the sails” of their life and leadership. 

6. Learning. Whether it’s rapid pivots, adaptations or genuine innovation, this is a sprint of learning that could define the winners and losers of the next decade.  Some will have coasted, others will have been building and preparing (Proverbs).

How will you respond to the VUCA reality?  What are the wins from the first 2 months of this seismic shift?  There’s a “whole lotta shaking going on,” but how are you leaning into it and leading?  How can these tools and frameworks help you and your business demonstrate the power of the Gospel in the marketplace of 2020-2021? 

For more information on COVID-19, please see our page highlighting some of the best resources out there for Faith Driven Entrepreneurs in this season.

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[ Photo by Lina Trochez on Unsplash ]