If you are an experienced leader, you know that planning ahead is the first step in any successful business strategy. However, in a crisis, planning ahead is a liability since everything will be constantly changing. If you were to try and plan ahead, your plans would likely become obsolete as fast as you could produce them, making them a huge waste of time.
At the same time, you can’t operate without a plan. What is the solution?
Crisis management requires you to use time dilation in your planning. You want to start planning in very short term increments and expanding that planning timeline as the crisis settles and things become stable enough to plan farther in advance.
Time dilation in planning might proceed as follows:
When the crisis first hits, you abandon your old plan and focus on trying to get your bearings. What metrics can you trust? What fundamentals still hold true? As you find those foundational elements you begin to plan a month in advance, waiting for more information about how the crisis will play out. At some point the market will stabilize (but not recover) so you can plan for the next quarter. Eventually, the market will begin to recover and you can begin to plan a year in advance again.
Note that it’s not clear how long it takes to transition from one mode of planning to another, that will depend on your business and the nature of the crisis. Some crises last days, while the Coronavirus crisis promises to last many quarters. In the early days of the crisis, the crisis management plans you have will not be reliable as it can be hard to plan even just a month in advance. The best sign that you are ready to transition from one mode to another is that your plans are becoming more and more reliable, as that means the market is stabilizing in ways you can plan around.
Because long term planning is so fundamental to companies, it can be tempting to try and revert back into long term planning mode too quickly. It feels more natural to follow old habits, so it’s natural to try and push things back to the way they were. This is dangerous since it means you aren’t following the data, and in doing so likely risking more mistakes and more time wasted.
Planning is more of an art than a science, so you will need to trust your experience and the early indicators you identify in your data to know when to make the right planning transitions.
Quote of the Day: “Tactics is knowing what to do when there is something to do; strategy is knowing what to do when there is nothing to do.” – Savielly Tartakower