Leadership Lessons to Manage Through Covid-19
Leadership Lessons of Past and Current Crises for Management During Covid-19
Any crisis undergoes a lifecycle – it unfolds over time with pre-crisis, the crisis event and post-crisis. The current coronavirus pandemic is not spared. As this course continues to unravel in the fashion industry, some businesses will be resilient while for others, the future could be catastrophic. The fate of businesses lies in the deliberate actions of their leaders and teams at the time of the crisis event.
We have organised lessons learnt from seasoned executives about the experiences of leadership in times of disruption, now and in past crises. These findings present key learnings on prioritising immediate action and communication, while keeping the long-term purpose and direction in mind.
Crystal Clear Responsibilities and Accountability
During a crisis, businesses are fragile. Therefore clear roles and responsibilities become even more critical, and decision-making must be clearer and more succinct than in other situations.
Elaine Low, our director of retail strategy at Omnilytics, former divisional brand manager of Gap and Banana Republic during the global financial crisis in 2008, emphasised the need for accountability. “Inputs and questions over decisions from multiple departments and different people will be counter-productive at a time which calls for agility and flexibility. There needs to be accountability deriving from a single decision-maker”.
“Inputs and questions over decisions from multiple departments and different people will be counter-productive at a time which calls for agility and flexibility. There needs to be accountability deriving from a single decision-maker.”
Former chief human resources officer at Nike during two major economic crises, Jeff Cava shared his experience as quoted in an interview with McKinsey, “It sounds obvious, but many leaders don’t understand that when people are under extreme pressure, they revert to interpersonal styles that tend toward preservation over collaboration. If your team dynamics aren’t in a decent shape, crises will amplify the dysfunction.”
To avoid compounding issues at a time of crisis, crystal clear responsibilities and accountability set the foundation for agility in fluid situations.
A Conscious Approach
Effective communication is key. But how do leaders maintain a balance that is neither too negative nor overly optimistic? Leaders are still human and can make mistakes. Therefore, employing honesty in addition to raising levels of consciousness, will avoid giving false belief and false confidence which can lead to catastrophic outcomes.
When Elaine made the collective management decision on cost-cutting during the 2008 global financial crisis, she wasn’t acutely aware of how the management team would be perceived. “Besides freezing hires, we imposed salary reduction only for the senior management and managerial levels. The decision was communicated to the wider company. We were pleasantly surprised because the ground staff was appreciative that we kept their jobs intact and were driven to meet targets for the business.”
In the current Covid-19 crisis, Andrew Keith, president of Lane Crawford and Joyce with operations in China and Hong Kong, shared with The Business of Fashion that one of the most important things the business has done is to maintain constant communication with its customers. “It is not driven by a need to sell, but rather the need to stay connected, to make sure everyone is safe and to know we are all pulling through this together.”
Andrew has successfully planted the seed for a rebound with this approach, as the China business is already starting to see customers returning. He is currently looking at how to accelerate business in China and create new customer experiences.
Focus on Strategic Growth Levers
In moments of crisis, it is easy for business leaders to get sucked into the daily operational actions, as fast-changing situations create uncertainty for managers inexperienced and unskilled to make the right decisions.
Nonetheless, leaders need to intentionally take a broad, holistic view of both challenges and opportunities. An effective leader not only manages the present, but also anticipates what comes next month, in 3 months and even next year in order to prepare the business for the changes ahead.
“When retailers halted new store opening projects during the global financial crisis, we assessed our reforecasted revenue projection and decided to renegotiate with the landlords for key locations to be retained, but delay on opening timings”, explained Elaine on her then company’s strategic focus.
Besides business expansion, one of the key growth levers in fashion is newness. While many brands are scrambling at managing spring orders cancelled by retailers, there are few who have decided to also focus on future seasons.
Despite having downsized its warehouse manpower and closed retail stores in the U.S. and Europe, Rick Darling, chief executive officer of Global Brands Group, remains steadfast on working through the cancelled Spring/Summer orders with suppliers, while moving forward with Fall/Holiday programs and developing Spring 2021.
Echoing this, is Gary Wassner, the CEO of Hildun Corp who wrote a blog for The Council of Fashion Designers of America (CFDA) to help fashion businesses chart their course of action in the coming months of uncertainty.
“Soon we’ll evolve into a stabilisation phase when planning will begin again and sales will start to generate some revenues. At this point, you want to be positioned to fill the immediate needs of retail.”
In addition to planning the cash flows based upon three different stages of crisis response: panic, stabilisation and recovery, Wassner also emphasised monitoring consumer demand shifts. He believes that the current phase will soon evolve. While retailers will buy again in due course, they will be very selective and cautious. Therefore, brands and businesses are advised to start strategising and planning to meet those needs now.
You might also like
Operational Excellence: Store Reopening Strategies Post Covid-19
Nearly five months on from the global spread of Covid-19, lockdowns are finally being eased and stores are reopening. Most countries in Asia as well as Italy, the UK and US are now gearing up to ignite economic engines again. The impact of Covid-19 on retail has been tremendous. After months of strict lockdowns, brands […]
Where Does Black Friday Fit into the New Fashion Calendar?
With the fashion industry lobbying for change in seasonality, what will happen to Black Friday? It’s around this time of the year that fashion buyers and merchandisers will normally start preparing for the retail phenomenon, the annual event that has trained consumers to expect price slashes and spawned a discount culture that the industry has […]
Post-Pandemic Retail: Shifting The Fashion Calendar
In the past few months, the fashion industry has been forced to reconcile with deep-rooted, systemic issues that have troubled the industry for decades. While stores are slowly beginning to reopen and some of us return to work, for many a clear vision of the post-pandemic retail landscape is hard to picture during current uncertainty. […]
Taking a Leaf Out of Asia’s E-Commerce Model with Natalie Lee and Giulio Xiloyannis
The Asian e-commerce landscape is rapidly recovering from the effects of Covid-19, an outlier which generated interest from global businesses. Brands and retailers are keen on penetrating the online space in the region, but doing so requires a different approach than in the West. In our recent webinar hosted by Simon Collins, the co-founder of […]
Digital Revolution: Key Lessons from the Crisis and How Fashion Can Navigate the Next Normal
The fashion industry is no longer what it once was. Covid-19 has reshaped the entire retail landscape, as consumer priorities quickly shifted. It has transformed every step of the value chain, from where the products are sold to how they are marketed and delivered to customers. This leaves fashion companies with no choice but to […]
What Bridal Retail Looks Like in the Aftermath of Covid-19
This year’s wedding season is a washout. With bans on large gatherings in place to contain Covid-19, the summer wedding season has been pushed to later in the year and possibly even into next spring. Fashion is a major stakeholder of the wedding industry – bridal retail is worth an estimated $300 billion globally. Uncertainty […]