Crisis to opportunity: How businesses can succeed in uncertain times

The current generation of business leaders are not new to significant disruption, whether it be the dotcom crash, the 2008 financial crisis or the Great Recession that followed. Few of these, however, have had a larger impact than the COVID-19 pandemic. Overnight, businesses had to shift their entire business models, offices became obsolete and even the most technologically immature businesses were forced to revolutionize their capabilities. 

For many, the pandemic was a time to pause, contemplate and detach from the intensity of working life. Yet history has shown us time and time again that disruption births creativity and success. Crisis always presents opportunities.

We are living through another crisis in 2022, with the pandemic shifting to a more uncertain world dominated by the looming threat of global recession.

A crisis does not have to be daunting. It can be an exhilarating, career-defining moment for a leader. It hangs on how you and your business respond to the moment.

Finding the talent

One of the core crises resulting from the pandemic has been the Great Resignation. Soaring demand for tech talent has been nearly matched by a similar surge in workers leaving roles. In the US, there are roughly 3.9 million unfilled IT roles, and in March 2022 a record 4.5 million US workers quit the labor force.

Whilst explanations vary, executives are clearly motivated to find a solution to the problem. A recent Fortune-Deloitte survey found 73 percent of CEOs saw a skills/labor shortage as the most likely external issue to disrupt their business in the next 12 months.

Managing this uncertain environment needs to be guided by one core principle: you will not save everyone. Short-tenured employees are here to stay, and will remain long after this current crisis has faded from view.

The pressure on spending is likely to push firms to review expenditure on headcount. Take this as an opportunity to reduce your reliance on tribal knowledge, enhance processes and build training and education programs fit for the long term. And of course, when opportunities arise, identify talented employees stuck in unfulfilling roles and offer them something better.

Lessons from the past to build a better future

Adapting to an altered environment can be difficult. Organizations that do things one way can quickly find themselves struggling. Blockbuster Video epitomizes this phenomenon. They felt the pain of the 'innovator’s dilemma'. They had everything in place to become Netflix, but their legacy business model consumed the majority of their time, attention and investment, and innovation slowed. They quickly went into decline and missed the chance to embrace the new era.

Blockbuster’s fate is a cautionary tale for businesses facing disruption, but it is not by no means inevitable. A rapid crisis like the one we experienced in 2020 can be useful. Forging opportunities requires a willingness to rethink norms and move forward with courage and conviction.

The key is not perfection. In this new world we all live in, the answer is speed. Businesses have to embrace the fact that failing fast is essential for success. 

Companies then need to embrace the moment of crisis as an unprecedented chance for innovation. Disruption or recessions are not a moment to throttle back on your vision. It is rather about doubling down on your commitment to your foundational vision, look for new opportunities aligned to your vision and rethink your next steps accordingly.

Here are two examples of companies who successfully innovated in a crisis:

Amazon: a case study in crisis innovation

Perhaps the most well-known example of a crisis innovator, Amazon has thrived across the dotcom bust, the 2008 financial crash, the Great Recession, and now the COVID-19 pandemic. Amazon was incredibly well-positioned in 2020 to serve the millions of people locked down around the world, scaling up as online demand soared.

But the company has also gone through other phases of innovation critical to its current success. Then-CEO Jeff Bezos nurtured innovation by splitting the company into 'two-pizza teams'. These teams (so named because they were small enough to feed with two pizzas) were autonomous and held accountable for results. 

The other key moment was Amazon’s recognition after the dotcom bust that it could be a platform to support other business. Amazon Marketplace, Amazon’s platform for third parties to sell used books, launched in November 2000 and the rest is history.

Mailchimp: doubling down on the vision 

Today Mailchimp is a titan of the marketing industry. But its journey to get there has been far from straightforward. In the early 2000s, Mailchimp enjoyed some success but had yet to take off. But in the 2008 Great Recession, Mailchimp’s moment arrived: it grew its customer base from 85,000 to 450,000 in just one year. It achieved this goal by shifting from a retainer-based approach to a freemium model, recognizing customers were struggling in the challenging economic environment.

Mailchimp redoubled its commitment to its mission and stayed innovative, growing the company at a time of crisis and laying the foundations for long-term success. As Mailchimp CEO Ben Chestnut said, a crisis is not "time to kind of sit on your front porch and sip mint juleps… Its time to build your business strong, build the roots strong."

Embracing disruption to find a path to a better tomorrow

Charting a course through a crisis is not easy for an organization. Leaders need to be confident in their abilities and rise to the occasion head on. It all comes back to having a vision, and building a company committed to making it a reality. Act with conviction to spearhead change, and you will bring others with you.

It is important to remember that the answer to today’s problems does not lie in old ways of doing things. New approaches are needed -- whether it is fresh approaches to talent retention or better ways to deliver on your vision. And behind it all needs to be technology. We are all tech companies now. Success in today’s connected world rests on scoping out and investing in new and emerging technology -- across AI, hyperautomation, and high-performance compute. Remember, all these technologies are more accessible than ever before via the cloud.

Today’s crises have created a world more uncertain than ever before. But you should be under no illusions, these will not be the last crises your business faces. It is up to every leader to maximize the opportunities created by disruption and lead their organizations forward on a path to a better tomorrow.

Image credit: realinemedia/depositphotos.com

Brian Klingbeil is CSO at Ensono.