Rebuilding from the ruins
“After Berlin had finally surrendered to the Red Army at 3 pm on May 2nd, 1945, straggling columns of German prisoners, many half-crazed by the ordeal through which they had come, began to be marched to prison camps on the city’s outskirts. Many laughed hysterically and could not stop laughing as they trailed through the shattered city. Here, some of the 120,000 prisoners taken in eight days’ fighting for the capital emerge from a ruined building on their way to captivity. Hundreds of German military engineers were at once ordered to restore Berlin’s public services put out of commission in the fighting.” — The Second Great War: A Standard History (vol nine). Published Oct 1946
I have to confess that I find it challenging when I hear the use of “war” in the context of Covid19. There is clearly a need to overcome — but somehow war, battle, fight, defeat all seems to demean those that fought in wars. Today the UK celebrates Victory in Europe day and the end of World war 2 across the continent. I was looking over old newspaper articles and photos of the war yesterday (no, I’m not that old to have been there) and reflecting on the various emotions of the participants — the Soviets who lost 20 million citizens; the Germans who lost so much and were defeated but also liberated from the curse of the Nazis; the Americans who could go home and the British who could celebrate the end. I imagine there will be many articles written today about “the new war”. Neighbours and friends have been talking of street parties, celebrations, how to use new found freedom for that moment when “Coronavirus is over”. I found some really interesting lessons in this photo of the shattered ruins of Berlin and the description underneath.
The lasting impact
“Many half-crazed by the ordeal”
For some of us this has been nothing more than a mild disruption and a time to see our families. For others, this means you can’t feed your children. The trauma of economic insecurity, food poverty, loss of job security, concern over ability to pay your debts and whether you can still live in your house is and will be horrific. There is an immediate need to address ongoing food poverty, particularly among families with young children. In the UK Trussell Trust says “more than twenty percent of parents have skipped meals, gone without food to feed their children or relied on family members or friends to provide food in the last twelve months.”
Malnutrition leads to stunted growth, it leads to less educational attainment and also an inability to focus on things other than finding food each day. We return to the bottom of Maslow’s pyramid and the idea of self-actualisation, community and even security and peace become secondary. With UK GDP forecast by the Bank of England to decline by 14% this year (the biggest decline since 1706) and US unemployment figures to come today and expected to show 15% unemployment already, the economic pain is only just beginning to be felt. Our lack of institutional memory and our inability to capture the lessons of the Great Depression of the 1920’s mean that for many of us we have no idea what this will feel like or what will happen.
There is an opportunity to lead as those that create jobs, but also to tackle the great challenges arising as a result of the economic collapse. Whether mental health, debt mountains, food poverty, education gaps, global inequity, racial inequalities — the list goes on. As at the end of World War 2, the needs were very stark. I’ve been reflecting on Sony, built in the ruins of Japan post WWII. As set out in Jim Collin’s book Good to Great, Sony initially began manufacturing kettles before later moving into consumer electronics. To some extent, it doesn’t matter what model you pursue or what issue you tackle — the needs are so great that you should just do something.
This is not to suggest ignoring that for many this is a step too far. As one friend said to me recently “My big concern is around the mental health of any work staff over the next year. I think many will not have the mental energy for change. Mental exhaustion will be high, untreated issues of anxiety, fear and grief will affect the capacity of work forces. Greater illness, need for more pastoring and counselling etc. All these may limit required speedy change.”
Question — what steps are you taking to build self resilience and organisational resilience for the coming months? What steps can you take to meet the growing needs from those with least? Is there a new market opportunity?
Liberated to what?
“emerge from a ruined building on their way to captivity”
These German soldiers probably knew that the war was over. They could walk out of the building knowing that the years of fighting were ended, that they could get up not wondering if they or their comrades were going to die today. They could stand and look at the sunshine and not wonder if they were going to get shot. And yet they headed to a new captivity, albeit for a short period until they were demobilised and freed to return to civilian society.
For many of my US network, the lockdown has ended and they have moved back into into the outside world of offices and roads and factories. For those in the UK, we await developments on Sunday but anticipate a change to lockdown restrictions and stay-at-home orders. France, Germany, Italy, Spain, Pakistan — the news is of people emerging from their houses and finding a form of freedom in the restricted liberty of the new normal.
For entrepreneurs and leaders, the time continues to be of uncertainty. This week I have talked to people where 40% of staff (white collar) have been furloughed or made redundant; where donor giving is down by 50% due to lack of Asian students; where knock on implications of failings in distribution chains are leading to factories not being able to produce and of more distressed companies seeking assistance in finding funding or buyers or restructuring. Even in those organisations that remain viable and operating, the focus remains where is the revenue, what are the sources of liquidity and short-term cash, what plans can be made for 2021, what will the consumer do and when will government funding support end.
Planning cycles remain short — I know of one major company where board meetings are every two days currently. Hiring remains on hold and investment plans have been reigned back. Growth remains in digital and in healthcare and in those businesses that can solve problems in the coming economic depression.
How do you go back to work? When do you open your office? How do you open your office? Is herd immunity the way to go? Will immunity last? The ongoing planning and preparing is taking up time that would normally be spent on longer term strategy and creativity. This creates an opportunity for entrepreneurs — when everyone else is thinking of survival still, an entrepreneur can find gaps in the midst of uncertainty.
Question — In the midst of uncertainty, where are the opportunities to create? What are the majority ignoring because survival is the priority? Where can you lead?
Refocusing on the new normal
“Hundreds of German military engineers were at once ordered to restore Berlin’s public services put out of commission in the fighting.”
This was a fascinating last line of the description. Those that had been in captivity were immediately free and charged with rebuilding. As I mentioned in this piece, our focus as Western society is turning away from the health crisis and into the economic crisis. We still appear to be pursuing containment and mitigation strategies and are seeking to flatten the inverse economic curve — with the Government needing to learn that it needs to be a provider of demand, rather than a funder of last resort for people and businesses to stay in the status quo. With the velocity of money having shrunk dramatically (car sales in the UK down 97% in March, travel retail sales of spirits down 97%), the challenge is who is the ultimate purchaser going forward. It may require the government to spend to kick-start the economy.
As we move to restoring our economy, there are lots of conversations on how we should rebuild and how society should change. These conversations largely seem to be happening among politicians, the media and academics and therefore are unlikely to bear much short-term fruit as those in business focus on how they can regain what has been lost.
If you are looking for a job then sectors to focus in on are public sector, education, digitally delivered services (particularly around leisure, hospitality, tourism, travel, experiences), direct to consumer, rethinking supply chains, restructuring, content and content marketing, mental health, home interiors, stay-cations, biotechnlogy, medical devices, poverty relief (although only in well-funded NGOs or businesses). Infrastructure and construction may also be a source of government largesse as it creates jobs and economic output (albeit temporarily).
If your business is closed, or your business model no longer is valid, then go back to the why. What got you into business in the first place? Who do you want to serve and what needs do they have? What assets (people, skills, physical assets, finances, networks) do you have that can be brought to bear to meet those needs? What need will last beyond the next 6 months and is a great enough need to justify serving?
The key question for me is where is the revenue. Where will people and businesses be spending, or will spend more? For example, in protective equipment for offices — for a season. Ask your networks where they plan to spend and prioritise. Supply chains will be less global, or at least with regional redundancies built in. Companies will need help to recapitalise and refocus. Non-profits will have to navigate new income models as they face into a significant downturn in donor funding. Stay-cations will be more popular. Homeschooling may rise in popularity. Direct to consumer and subscription boxes will appeal more than a trip to the shops. Netflix over Cinema. Take-away over restaurants. Online banking over physical banking. Parks over gardens. Hill-walking over road-walking. Nature over theme parks.
I wonder what these German engineers felt at the moment of liberation as they were ordered to restore the public services. Did they feel fatigued? Or scared? Or motivated and excited? Germany rebuilt itself into an amazing country, one that has produced high quality, creative, high price products that travel around the world. Of brands that excel and Vorsprung durch Technik (progress through technology). The initial moments of that rebuilding were of people like those in this picture who were beaten, defeated, half-crazed and uncertain. Yet those were exactly the sort of people that began the rebuilding of a nation. Will that be you?
Question — Where is the opportunity? Where can we step into the new normal and rebuild? How do you or your organisation need to pivot?
As ever, feedback, comments, additional wisdom always welcomed.
