Organising for the New Normal

LBS faculty Costas Markides explores how to prepare an organisation’s response to continuous and overlapping disruptions

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The Dubai Airshow in November proved to be the largest aviation trade event held since the pandemic began 20 months ago.

Although US aircraft manufacturer Boeing staged a recovery by securing an order for 72 of its controversial 737 Max from new Indian airline Akasa Air, it was the European manufacturer Airbus which took the laurel wreath for the show, amassing 408 announced orders and commitments by the end of the show’s fourth day.

Unsurprisingly, cargo planes and converted freighters were in demand as ecommerce booms and air shipment grows.

There are many powerful takeaways from just this one single event that serve to provide commentary on the world we live in today.

First, we must acknowledge that we live in a world of continuous disruption. Before we have a chance to respond to one disruption, another hits. Before we finish one transformation journey, we need to embark on another. This is the challenge that every organisation, country and institution is now facing, no matter how successful their digital transformation journey over the past decade has been.

A case in point might be the urgent consideration employers now need to give to the concept of wellness. Concerned about “the great resignation”, employers around the world are having to not only consider the physical, mental and emotional needs of their employees as well they should, they also need to consider such matters in terms of productivity and profit as many employees are quitting their jobs in droves as they re-evaluate their choices. One crises crops up, and another presents itself!

In terms of the Dubai Airshow, the old adversaries of Boeing and Airbus continued to square off with each other. There remained the legacy issues that continue to present concern, such as Boeing’s 737Max. Boeing was in crisis before the global pandemic over its response to its rival’s aircraft, the Airbus A320Neos short to mid-haul aircraft. With two of its aircraft crashing almost one after the other, accusations of technical corner cutting and a dangerous allegiance to cost-cuttings beset the 737Max.

The narrative from the get-go was about endeavouring to claw back market share from Boeing’s rival, the A320Neos. Then Covid-19 hit and the whole aviation and air operator industry, from soup to nuts, descended into crisis.

One might suppose that the orders secured by both Airbus and Boeing mean that status quo will quickly resume. But that may not be the case, not by a long chalk. In July of this year, Comac, the Commercial Aircraft Corporation of China, Ltd., launched its single-aisle C919, and with it an industry that has been dominated by Airbus and Boeing since the start of the 1970s faces a new, deep-pocketed competitor.

And that’s not all, in the US itself, Boom Technology, Inc. is an American newcomer that is designing a Mach 1.7, 55-passenger supersonic airliner. With United Airlines and JAL as launch customers, Boom is some way off turning a buck. The company will start production in 2023 and the first plane is expected to roll off the assembly line in 2025, begin flying in 2026, and then carry passengers by 2029.

Just when they thought it safe to return to the air, a competitor from that fast adopter nation, China, and a home-grown threat from the West, Boom, means that both Airbus and Boing could be beginning to see the thin end of the wedge when it comes to eschewing formidable competition.

In my book, Organising for the New Normal, I explore how to prepare an organisation’s response to continuous and overlapping disruptions, or one disruption after another.

In an age of Covid-19, Brexit, the continuing legacy of the Trump administration, civil unrest, economic turmoil and the Damocles Sword of global warming, perhaps one ought to instead frame this subject in terms of becoming ‘comfortable with being uncomfortable’, and learning to be alert to the prospects (and potential misfortunes) presented by change. As Shakespeare once wrote, “Better three hours too soon than a minute too late. I wasted time, and now doth time waste me” which, in the modern context of what is shaping up to be a perfect storm of continuous, multifarious change, might be re-phrased as, ‘we all have the potential to pay for time we’ve wasted, so use time well’.

Simply creating a burning platform to generate urgency for change is not enough, since creating a pall of uncertainty and fear will drain away talent and creative input to problem solving. Instead, perpetual change ought to be considered in the context of a conceptual revolution about business. In this third decade of the 21st Century, we need to make a new story about business, not just chasing profit, but also finding a purpose and, yes, innovating.

Perpetual change presents a way in which to inclusively and creatively respond to change, whether it is ignited by crisis, or by a bold sense of opportunity.

My idea for leadership competencies critical for success in the “new normal” are, therefore, to:

  • Create a “permanent” sense of urgency and an organisation-wide unease with the status quo
  • Convince people to exploit disruption as an opportunity when all they see around them are the negative consequences of disruption
  • Institutionalise into the DNA of an organisation the day-to-day behaviours that would allow them to identify and respond to change early - and to do this in a decentralized, bottom-up way
  • Develop a strategic response that is innovative and aims to attack the disruption rather than defend against it.

In sum, if Airbus and Boeing, to name but two companies emerging from the white heat of the Covid-19 pandemic, are to truly consider their options for survival, then any considerations of simply waving a burning branch in front of potential challengers to ward them off is not the way to go.

Instead, they need to build a sense of creative urgency in with the bricks and gear of their organisations to facilitate a state of perpetual change.

Costas Markides is Professor of Strategy and Entrepreneurship; Robert P Bauman Chair in Strategic Leadership at London Business School. This article first appeared in Al Bayan the Arabic language newspaper in the United Arab Emirates.