Since Covid-19 began its disruptive tear through apparel supply chains a year and a half ago, companies have had to cope with copious amounts of change.
How leadership reacts to these pivot points and the choices they make will determine whether firms decline, stagnate or rise, Russell Raath, founder of The Ambition Company, said during a keynote address at the Sourcing Journal Summit on Oct. 19. He sees the potential for firms to improve their responses to moments of change, particularly coming out of the pandemic. Even though Covid has created countless twists and turns, this need for adaptability and agility will outlive the health crisis.
“These inflection points are going to happen,” Raath said. “We don’t know when they’re going to happen, but when they do, they can have debilitating consequences.”
Doing nothing is not an option, since it will eventually lead to a decline. Choosing functional approaches may keep a company where it’s currently at, but it’s not the recipe for growth. Instead, catapulting the business requires “bold” or “radical” action.
For one, Raath said leaders should establish healthy “competitive energy.” Those who have mastered this—which he estimates are only 10 to 20 percent of businesses—encourage employees to join the team and stay. On the opposite end of the spectrum, a harmful energy can push workers to want to leave, which may also have an impact on output.
The second factor is “response intelligence,” or the ability to quickly react to a situation. Raath pointed out that this doesn’t only mean crisis management, but also the longer-term efforts to prevent issues in the first place.
Some that get this wrong have a handle on the first part, but not the second. “They’re good at dealing with fires but they’re not good at marshaling the forest to make sure there are no fires in the first place,” said Raath. Having a less than superior response can also prevent change management from getting off the ground.
Thirdly, what Raath calls “focused performance” revolves around delivering on promises—both to customers and to stakeholders like investors and employees. This comes back to speed of reaction. If there is too much bureaucracy, it tacks on time to solving an issue. For instance, a delay in getting a replacement part for a factory could stall or slow production.
“If you’re moderately fast and efficient, well that’s good because everyone should be aiming to be moderately fast and efficient,” said Raath. “That’s not a competitive differentiator.”
Part of bold leadership is the need for goal-oriented influence. According to Raath, strategic considerations shouldn’t be the first part of enacting an action plan. By carefully articulating each step of the process, it can become a daunting list to tackle. Additionally, strategy is often developed by leaders and then must be executed by other staff who had no part in the planning.
Rather, what needs to happen to create momentum is inspiration. Giving employees an end point to work toward puts the focus on the accomplishments along the way, and keeps them feeling positive and motivated.
As an example of this ambition rather than strategy mentality, Raath pointed to how President John F. Kennedy talked about the lunar missions. Even though he acknowledged the difficulties in reaching a moon landing, the language was more about looking ahead to the end result the U.S. was striving for.
“Anything we’re doing in the supply chain is a tiny fraction of the degree of ambition and the degree of performance you need to get to the moon, for the most part,” Raath said. “If we can get to the moon by channeling an ambition, we almost certainly can channel our inflection points in our supply chains, or in our world, by focusing on ambition similarly.”