As we emerge from the pandemic, we will find permanent changes and shifts in the way we do business which will force management teams and boards to navigate a new normal. From dislocation and disruption emerge lessons and opportunities.
As a director, I believe boards and management in a post-COVID-19 world need to focus on:
Back-up plans. COVID-19 was a multiprong attack forcing companies to deal with liquidity issues, supply chain disruption, contact center shutdowns and infrastructure challenges, not to mention employee-related and leadership issues. Were you able to secure enough cash at hand to weather the storm? Did you have alternate supply and production sources? Were you able to take advantage of opportunities during the crisis to pivot or lean in? How did technology work in supporting an at-home workforce? Was the worse-case scenario appropriately challenged? Post-mortem what your company did and did not do well and capture these lessons as you build out your future strategy and business continuity plans.
New shareholders. Many companies saw a dislocation in stock price that presented a buying opportunity for hedge funds, PE firms and potential activists. Unlike during the financial crisis, these companies are well-funded and have significant buying power. As a board and management team, were you actively focused on this during the crisis? Did you evaluate rights plans or other measures to protect the broader shareholder base? What does your new shareholder makeup look like and how will you work with them?
Culture and communication. Assess how management and the board operated during the crisis. Did the corporate culture stand up to the test and did employees and leaders rise to the occasion? Did leadership effectively communicate to all stakeholders, especially employees? Was the team taken care of in the best way possible given the circumstances? As a board, were you an effective sounding board and adviser for management while resisting the temptation to co-manage?
Remote workforces. While the pros and cons have been long debated, now that working from home has been forced upon all of corporate America, what’s next? What will the new norms around workplace flexibility and business travel be going forward?
There’s nothing like a crisis to crystallize what’s important — areas of risk, opportunity and readiness. During the crisis, we skipped the small stuff and focused on what really mattered. Boards should keep this momentum, consider refocusing quarterly board meetings to require fewer formal presentations from management. This would allow more time to discuss what truly can move the needle in one direction or the other.
Dawn Zier currently serves on the board of Hain Celestial Group and Spirit Airlines where she chairs the nominating and corporate governance committees.