Leading in the New Normal

execunetselect-businessman-cityIn March 2020, when COVID-19 sent the world home for an unknowable period of time, at Caldwell, we launched an effort to bring business leaders together to share information, hear from a variety of experts, and help mitigate the isolation.

With those goals in mind, we launched a webinar featuring a few business leaders as presenters, and ample time for questions from the audience. In 16 months we hosted 32 sessions with 100 business and community leaders and 2500 different board directors and C-suite executives from across North America and around the world.

The topics evolved from COVID-19 lockdowns and remote work, to racial equity and social unrest, to vaccines, election matters, and then to return-to-the-office plans and operating in the new reality, with many other topics along the way. Leaders were generally optimistic about the future, but also eager to gather information. Our speakers brought diverse perspectives and expertise and included two former Governors of the Bank of Canada, renowned medical professionals, COVID taskforce leaders, and leaders from most industries including aviation, retail/e-commerce, financial services, senior care, utilities, and so on. We
offer our sincere thanks to our wonderful speakers – their contributions were invaluable.

From our vantage point, collaboration among companies seemed at an all-time high during COVID-19, and this was one aspect of that. The forum allowed business peers to hear how others were navigating the rough seas, share insights on common challenges, and validate choices related to remote work.

What else did we learn during these conversations? Across the range of topics discussed, a few messages and priorities repeatedly came through from board directors and management leaders, and we heard more detail on these matters during follow-up conversations with listeners, all discussing the new normal.

Lessons from the Top

We asked some of our board director and CEO speakers about the biggest lesson learned from the pandemic and economic crisis. They had some interesting things to say, and you’ll find their thoughts sprinkled throughout.

“What has impressed me the most during the pandemic is the willingness people have shown to pull together, support each other and adapt. These past two years have taken an emotional and mental toll, yet through it all I have witnessed, in our Cenovus staff and others, true compassion and commitment to getting through this and to making the best of a challenging situation. As a leader, that has been heartening to see.” –Alex Pourbaix, CEO Cenovus

New Normal Board Priorities

Planning for “100-year storms”

The pandemic reminded board leaders – and the rest of us – that what can never happen, just might happen. And in moments like that, having a reasonable understanding of your company’s plan “B” or “C” for company operations is invaluable. “100-year storms” seem to happen more frequently today, and the pandemic is just the most recent face of the rapid, continuous change buffeting companies. There is more to come. Collaborating with management in taking a hard look at the company’s vulnerabilities and its opportunities to pivot figures ever more prominently on today’s board agenda.

British Prime Minister Sir Winston Churchill is credited with saying, “Never let a good crisis go to waste.” A crisis is indeed a good time to enact innovation and creative thinking, as potential roadblocks to change tend to be more readily swept aside.

In just one example, consider the pivot underway among auto makers in relatively quick response to shifting consumer demands for electric vehicles. Many are entering the space in a significant way, planning for 40%- 50% of the fleet by 2030, while Volkswagen intends to be entirely in electric vehicles in Europe by 2035. Even the largest auto makers see a need to transform.

In the largest pandemic pivot, many companies were surprised by the smooth transition to remote work and the quick uptake by employees to the necessary technology for this change—a change that occurred faster than anyone could have predicted. That is the good news. The sobering news: Boards understand that companies will need to keep up the pace, keep pivoting, and continue to do more than seems possible. The change mandates of the “100-year storms” will keep coming.

“There is no force, including COVID, that can overcome the innovativeness and adaptability of organizations determined to thrive, not just survive, in times of crisis. The remarkable ease of transitioning to new ways of executing business came from years of hard work and support systems like IT and HR that were able to support this because they were ready and battle tested (NEP, SARS, 2008  financial crisis and so on). Complacency and status quo perspectives did not dwell in these companies.

It is too late when this type of tsunami of change hits to start building your business continuity plans. Having credible and trusted leadership is vital and a perspective that says ‘How do we adapt our fundamental purpose as a company to these new conditions vs. how do we tighten our belts and try to preserve our existing business despite the changes around us?’

Those companies with high performance governance that knew when to get out of the way of management and let them do their job and when to insert themselves is to a large extent the distinguishing reason why the impact of COVID has been so uneven not just across sectors but within sectors as well.

At the very end of the day, despite all the above, it comes down to leadership at the Board, the company and a culture that pulls together because they know they are better together.” –Don Lowry, Director Stantec, Alectra, RS Technologies, Capital Power

“With the explosion of information and decisions to make during COVID, I have come to realize that as baby boomers we need to transition from leaders to followers. Our power is to back new ideas and science rather than continuing to push ideas we formed in the past.” –Dave Mowat, Corporate Director TELUS, Laurentian Bank, etc.

Boards Must Be Nimble and Companies Entrepreneurial

Board leaders agreed that being nimble and entrepreneurial is an important corollary, and requirement, to managing through the storms. And that is necessary for companies of all sizes, but more challenging for boards of larger companies.

During one session, Stephen Poloz, Special Advisor, Osler, and former Governor of the Bank of Canada, noted the dichotomy of the business impact of the COVID lockdowns, stating, “There are Have, and Have-Not industries. Some will make up for lost time, some won’t. You might use up all of your vacation time and do a lot of travel, but you won’t go out and have six steak
dinners in one night.”

Directors of companies that find themselves among the Have-Nots will need the courage to be responsive and to collaborate with management to potentially drive bold decisions and changes. Boards are serving as valued partners in rethinking business strategies.

“It’s often been said that “crises reveal character, they don’t build it.“ That’s been particularly true during COVID. The list of critical leadership attributes – communication, resilience, a calm demeanor, the ability to see around corners and model downside, a commitment to take people and labor groups with you – is hardly a revelation. Yet a crisis of this length and depth has made those attributes more fundamental than at any other time in corporate history.” –Ed Sims, CEO Westjet

Transformation Experience is a Must-have Skillset

Having leadership that’s comfortable with change is crucial today. In the past, boards might seek a “war-time” or “peace-time” CEO during the appropriate periods for the company. That has changed. Boards now seek a CEO who is adaptable and flexible, who can respond to or initiate change quickly, and effectively manage in many business environments. The same is
seen in the requirements for board member competencies. More than ever, boards are looking for battle-tested directors who have a proven track record of facing crises and overcoming adversity.

Interestingly, we also see this attribute strongly reflected in this year’s applicants to our Canada’s Top 40 Under 40TM program. Founded by Caldwell in 1995, the program celebrates the achievements of 40 Canadians in the private, public and not-for-profit sectors who have demonstrated remarkable success before passing the age of 40. More of these younger leaders are focused on innovation, new products and change for the sake of social impact—while harnessing a transformation mindset. While those have been a hallmark of honourees over the years, they have those skills in spades this year.

“As one of Canada’s greatest CEOs said during the early days of COVID – ‘in the past ten weeks our world has moved forward by ten years – we’re not in 2020, we’re in 2030’. This was a bold, profound statement. And here we are many, many months later and we’re not out of the crisis yet. I’m amazed by the number of companies and individuals that are waiting for the world to ‘return to normal.’ There’s never been a better time to embrace bold change and new thinking and preserve the agility and resilience we learned in real time in the early days of COVID. Let’s not return to normal.” –Colleen Johnston, Corporate Director Shopify, McCain, Chair Unity Health and Q4

ESG is the No. 1 Issue in the Boardroom

While it may sound like an innocuous acronym, ESG has become a powerhouse force in the boardroom, the workplace, and
society at large, in the journey to what is sometimes called responsible capitalism. Environmental, Social and Governance
issues, first used by institutional investors as non-financial factors in assessing risk and opportunity in potential investments, have come to encompass a broad range of societal goals including racial equity, social justice, gender equity, climate change, access to healthcare, executive compensation, leadership diversity, and more.

Up until recently, many directors felt that ESG was a cost of doing business – frankly many saw it as a good defensive strategy. Almost overnight, many directors have begun to recognize that ESG friendly strategies are good for business. More than ever, they feel keenly the responsibility of addressing those goals and responding to inquiries from investors, consumers,
regulators, advocates, employees, and other stakeholders regarding the company’s status and progress in these categories.

Wildfires and heat waves across North America keep environmental matters at the forefront. Pandemic issues raise social and governance questions. Can employers mandate employees back to work during a pandemic? Can employers mandate employees to be vaccinated? What responsibility does the company have to customer safety if employees are not vaccinated? All of these questions are currently front-and-center for every leadership team and board and the ESG bucket encompasses all of these and more.

“When I reflect on what differentiated responses through the crisis and what were companies’ sources of inimitable competitive advantage, I come back to the importance of never underestimating the value created by having an army of caring and compassionate leaders to enable teams through change. You can’t teach this to leaders overnight. Hiring and fostering caring leadership has to be part of your company’s DNA. You may have launched the best programs and processes to support your people through the crisis, but this couldn’t match the power of the collective daily actions of caring and compassionate people leaders at every level in an organization.” –Gillian Whitebread, EVP and CHRO, Lifeworks

The Board Director Role Just Expanded

Doug Haughey, Board Chair, Fortis Inc.; Lead Director, Keyera; Board Director, Hifi Engineering, applauds the work done by
directors in the past 16 months, and feels for them as well. He appreciates that the job has grown, saying, “We need more from our directors now. Demands of directors is up significantly .”

Board and management leadership roles are undeniably more demanding than they were pre-COVID-19. The pre-COVID-19 issues remain, and many new issues have been added to the plate. During Caldwell’s video forums, directors often noted that boards and committees that previously met quarterly or monthly, began to meet weekly or twice a month during this season of continuing crisis. Some board chairs and CEOs began meeting for a few hours each week. And the pace of decision-making, with less than complete information, also ramped up. The forums regularly included listener questions about how to best support management, and where the lines of board responsibility began and ended. Directors continue to wonder: Will this be the new normal of directorship? Many current and soon-to-be directors are now questioning the prior perspective that getting on a few boards is a good way to ease into retirement. With the added pressures and responsibilities of directors today, the
number of boards directors can and should sit on is expected to decrease. At the same time, many prospective directors are opting not to serve at all, making it a buyers’ market for the most qualified directors

“COVID brought a world of change to an immediate plateau. The ability of leaders to understand and grasp new market opportunities that emerge through such a crisis is critical. But recognition on its own is not enough, truly great leaders must have the courage and foresight to pivot their operations, capitalizing on the new realities with first-mover advantage.” –Kevin Frank, CEO Asten Johnson

“The ability for people and organizations to do “the impossible.” Few (if any) thought that their organizations could continue to function in a WFH environment only to see their people and processes adapt to these unforeseen circumstances.” –Jay Forbes, CEO Element Fleet Management

“The biggest learning for me was around people and leadership. The pandemic allowed different leaders to shine than if the crisis in the business had been driven by other factors. While the crisis created economic and financial strain, the organizational health, safety and operations challenges were immense. In many situations I saw an unusual mix of leaders working together to save their business.” –Senator Scott Tannas, Senate of Canada and CEO Western Investment Company

New Normal Management Priorities

Should crisis management become the norm?

Lisa Lisson, President, FedEx, Canada, noted, “contingency planning is the backbone of any successful operation. Anticipate the unexpected.” Other leaders share Ms. Lisson’s viewpoint. After instituting crisis transformation thinking and management with the arrival of COVID-19, many senior leaders were impressed with the success of the initiative. They wondered aloud:

Should crisis management become everyday management, with or without an imminent crisis? Is that sustainable?

Consider that the lockdown happened nearly overnight. Post lockdown the economy roared, with many companies quickly operating at 130% of their pre-COVID-19 business levels. With the Delta variant-induced 4th wave already overwhelming ICUs and causing restrictions to be reimposed, decreasing economic activity could again be the norm. Participants in the forums agreed that the new normal appears to be change, faster than ever before. And moving a business from 0 mph to 60 mph and back to 0 mph, is no easy task. Companies with nimble leadership that can effectively adapt to change and, in fact,
embrace change, will perform best.

Goldy Hyder, President and CEO of the Business Council of Canada, notes: “When you consider what we have been able to accomplish in such a short amount of time, it is nothing short of remarkable. For example:

  • Millions of Canadians pivoted overnight to working from home, enabled and supported by IT and telecommunications firms. The ease with which that change took place meant less disruption for the Canadian economy.
  • Essential services operated throughout the pandemic to keep us safe, fed and healthy. That includes grocery stores, pharmacies, trucking and logistics companies, and our energy industry.
  • Vaccines were developed, tested and deployed in record time.
  • • Manufacturers of everything from flight simulators to winter coats transformed themselves in a matter of weeks to
    address shortages of masks, ventilators, sanitizers, hospital gowns etc.
  • Bricks-and-mortar retailers embraced e-commerce like never before, accomplishing in weeks and months what otherwise might have taken years.
  • Online streaming services kept families entertained during lockdowns.
  • The financial sector provided mortgage and credit relief for hundreds of thousands of homeowners, while facilitating and delivering government backed business support programs.
  • Businesses in a wide range of sectors introduced COVID-19 testing and rapid screening programs, as well as vaccination clinics for their own employees and people in surrounding communities

“Lack of national consistency on fundamental issues did a lot of harm to public confidence. We should learn from this and resolve to do better in the next crisis – because there will be one. Canadians are resilient. They are prepared to work together and make personal sacrifices when the times demand it. But they need to know there is a clear and coherent plan.”
–Hyder, President and CEO, Business Council of Canada

Much of this change was driven by nimble companies in the private sector. “Canadian businesses stepped up to deliver solutions every time government needed help,” Goldy points out. He adds, “Canadians realize that governments can’t solve every problem. It takes a Team Canada approach, which in turn requires a much higher level of collaboration between the public and private sectors.”

“Scenario planning and table top exercises on various low probability, high impact scenarios and possible multiple risk impacts has been critical and extremely helpful in getting a head start on addressing the complex issues associated with COVID. In the end though, it is all about safety for our employees, customers and communities.” –Sarah Raiss, Director Loblaw Companies, Commercial Metals and Ritchie Bros. Auctioneers

“As Chairperson of a global organization active in more than 50 countries, I’ve witnessed firsthand the heightened pandemic-related interconnectedness and interdependence of our global community – including businesses facing the limits on global supply chains, governments grappling with a health crisis that will only be completely contained by a global solution, and  scientists, as never before, pursuing the development of vaccines and treatments via global ‘open science’collaborations.

Yet, competition for recovery resources is intense and widespread, with resulting shifts in societal values and geopolitics. Unchecked, these will have implications for decades to come. My hope is that any instinct towards insularity will be countered by the realization of our similarities. This was evident among our own workforce as employees from New York to Mumbai to São Paulo, faced and shared similar experiences, with a corresponding increase in their appreciation of mental health and the great value of connectedness.” –Heather Munroe-Blum, Chairperson, CPP Investments

The Return-to-the-Office Puzzle

When? How? Why? These are all relevant and timely questions when it comes to solving the back-to-work puzzle. As to Why? Chris Fowler, CEO Canadian Western Bank, believes in the career development and business effectiveness that comes from occasionally being in the office. He says, “You don’t get a degree in banking at university, you have to take what you learned in university and put it to work with other bankers by gaining experience on the job. Banking is an apprenticeship that you can’t do entirely from home.”

When the time comes to return to the office, a majority of companies hope to use a flexible or hybrid model of some days in the office, some days remote for most employees. Of course, there are exceptional situations with some companies having employees being 100% remote or 100% in the office. In addition to considering the functionality of a hybrid model, senior leaders are considering how to attract and retain the best talent. Rarely has talent held so much leverage over employers.

“We live in a time of both sudden and exponential change. No one has a crystal ball, so corporations and organizations that build resiliency as a muscle, have a flexible and adaptive strategy and the best talent will win.” –Indira Samarasekera, Corporate Director Scotiabank, Magna International and Canada’s Outstanding CEO of the Year advisory board

“My biggest learning or a-ha moment coming out of the crisis is how much we can accomplish in Canada when various industries and governments work together.” –Mark Little, CEO Suncor

Talent Implications

From Caldwell’s perspective, we are seeing record levels of job shifts and leadership changes. After a wearing 19 months,  many people are looking for change. At the same time, many companies are looking for change as well and they are seeking new talent—both upgraded talent for ongoing roles and new skillsets to match a change in direction for the company.

The job-shifting of this so-called Great Resignation includes retirees, some that delayed retirement, and others that   are speeding up retirement, as they don’t want to manage working amid crisis anymore. Others changing jobs will remain in the workforce, but don’t want to relocate geographically. Having restructured during COVID-19, they now prefer
to remain as remote employees. For others, the uneasy and the bored, the change is simply about wanting something new.

Surveys show that most people prefer fewer days in the office, so those companies that offer the greatest flexibility will have  the greatest access to talent. Two anecdotes are relevant to attracting and retaining talent, and representative of current trends:

  • While working on a search for a Chief IT Officer for a client whose preference was to return 100% of the workforce to the office, we found that although a number of the top candidates agreed with the in-office point of view, they declined the offer. Why? These executives believed the company wouldn’t be able to attract and retain the talent necessary for their teams, as other employers were offering the desired flexibility and would win that talent.
  • While working on a CFO search for a company headquartered in a smaller (yet desirable) center, a number of candidates declared that they would previously have considered a relocation, however COVID remote working protocols have taught them that they can be very effective working from home and declined to proceed in the search process for that reason. We’ve seen our outreach requirements increase by 50% over pre-COVID levels for clients requiring relocation for their hires.

Finally, if the company doesn’t have a strong ‘Why’ (as defined in the great book Start with Why by Simon Sinek), many of the highly sought after next generation talent won’t even consider a change – companies today also have to win the hearts and minds of talent.

“COVID-19 turned our world upside down especially in health care delivery. It exposed critical flaws in our readiness to deal with a fast-growing worldwide pandemic that overwhelmed us with its speed and ferocity. It also highlighted our Achilles heel, namely long wait times with little reserve in capacity and inefficient delivery of care.

We learned that most governments are short sighted and have neither the skills nor levels of preparedness needed to deal with rapidly developing disasters. Lockdowns were necessary because we overwhelmed already strained ICU and hospital capacity. This resulted in cancelling virtually all elective care and highly rationing other essential care. It will likely take at least two years just to catch up.

“COVID-19 turned our world upside down especially in health care delivery. It exposed critical flaws in our readiness to deal with a fast-growing worldwide pandemic that overwhelmed us with its speed and ferocity. It also highlighted our Achilles heel, namely long wait times with little reserve in capacity and inefficient delivery of care.

We learned that most governments are short sighted and have neither the skills nor levels of preparedness needed to deal with rapidly developing disasters. Lockdowns were necessary because we overwhelmed already strained ICU and hospital capacity. This resulted in cancelling virtually all elective care and highly rationing other essential care. It will likely take at least 2 years just to catch up.

Healthcare needs a major overhaul beyond simply trying to throw more money at the system with the typical Band-Aid solution. A longer living, ageing population coupled with new and expensive treatment options will put even greater pressure on the future delivery of healthcare.” –Dr. Harry Rakowski, Toronto Academic Cardiologist and National Post Commentator

The Trust Factor

As boards and leadership teams grapple with the changes that have come alongside COVID-19, it is worth noting the trust that
employees place in their employers. David Windley, President of IQTalent Partners, a Caldwell company; former Chair of SHRM; and former CHRO, Yahoo!, notes the findings of the annual Edelman Trust Barometer survey.

When people across 27 countries were asked in which organizations they put the most trust, in 2020, for the first time in recent years (and again in 2021), people responded that they put more trust in their employer than in media, government, or NGOs. Windley says, “Senior managers or board directors, should understand that context and communicate and operate accordingly.”

“My biggest learning coming out of the crisis is the resiliency of both people and companies. I watched people and teams in organizations at all levels adapt quickly and successfully to new and different ways of working together including with customers. We often underestimate the abilities of our people and how quickly old barriers resisting change can be broken down. This makes me optimistic as we move to the new post-COVID world.” –Bill McFarland, Director Fairfax Financial and Dexterra

“Covid exposed the strengths and weaknesses of our company like no other crisis could. In our case, it has helped foster even stronger interpersonal relationships built on trust as well as greater resilience in our global operations.” –Ian Smith, CEO Clearwater Seafoods

The Good News

If all this sounds doom and gloom, don’t despair, there are many success stories that have come out of the crisis as well. Consider the rapid digitization of workforces around the world. Many feel that we’ve done in the last 16 months what likely would have taken 10 years to accomplish, and there are countless stories of companies who have used the crisis as a launchpad to diversify their organizations and break through the atrophy that was keeping them stalled.

Ed Sims, CEO of Westjet Airlines noted: “Crises are the perfect time to hone empowerment and delegation skills. Calgary
got hit by a horrendous hailstorm in June 2020 mid pandemic when we had 50 of our most valuable aircraft parked on the ground due to the downturn. One of my colleagues in our Tech Ops maintenance area had decided months earlier to spend a few thousand dollars investing in hockey boards on the basis that they were a similar size to the spoilers on our planes.

That investment, his testing program using slingshots to simulate hail, then his dedication to fit the boards to all our parked
planes as the storm descended, saved the company millions of dollars.

Whoever coined the phrase necessity is the mother of invention clearly had times and people like these in mind …”

The Bottom Line

Board and senior leadership’s roles have never been more demanding, nor their consequences more impactful. Company and
individual fortunes have been made and lost during prior crises and will be again. Crises can do much harm, but for those enlightened enough to act swiftly and make the necessary changes, crises can also bring people together and make people and companies stronger. If you have the right leaders on the bus (thank you Jim Collins), it is a lot easier to adapt and live in this new normal. As executive search and human capital experts, Caldwell has much to bring to the table when addressing these and other boardroom and C-suite priorities.

We look forward to continuing our Leadership Roundtables series. We welcome your participation.

“At the University of Calgary, we first protected our community and then pivoted. I had the privilege to witness an incredibly diverse community pull together, making heroic efforts to move quickly to a technological learning environment to ensure students could continue to advance their studies and careers, and adaptive leadership in response to a myriad of unforeseen issues, always with the best interests of students at the forefront.

Now we are focused on the long-term possibilities sparked by COVID. The opportunity to do something extraordinary. To rethink the role of education in the life of a learner. To do this, the educators became the learners, the question being “what is the value” of education and how do we measure success, think about learning outcomes versus achievement measures, immediate job training vs long term knowledge development, human connection vs machine learning, develop teaching and assessment innovations- all while not losing sight of the importance of developing resilient, thoughtful, social-minded community contributing citizens. This is an experiment that was sparked 18 months ago and is still ongoing.”
–Geeta Sankappanavar, Chair Board of Governors, University of Calgary, CEO Akira Impact

Written by Les Gombik, Managing Partner of Caldwell’s prairie region

Caldwell Partners

Caldwell Partners

Caldwell is a leading international provider of talent across major industries. At Caldwell we believe Talent Transforms. As a leading provider of executive talent, we enable our clients to thrive and succeed by helping them identify, recruit and retain the best people. Our reputation – nearly 50 years in the making – has been built on transformative searches across functions and geographies at the very highest levels of management and operations. We leverage our skills and networks to also provide agile talent in the form of flexible and on-demand advisory solutions for companies looking for support in strategy and operations. With offices and partners across North America, Europe and Asia Pacific, we take pride in delivering an unmatched level of service and expertise to our clients.

Understanding that transformative talent is not limited to executive levels, our Caldwell Advance solution focuses on emerging leaders and advancing professionals who can also have a profound impact on a company’s ability to turn potential into success. We also leverage our skills and networks to provide agile talent solutions in the form of flexible and on-demand advisory solutions for companies looking for support in strategy and operations. Also, we are a leading licensed certified partner of The Predictive Index (PI), an award-winning talent optimization platform with a suite of talent strategy and assessment tools that, when integrated with our search process, helps clients hire the right people, then manage and inspire them to achieve maximum business results as fast as possible. To learn more: caldwellpartners.com

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