The role of the council and the leader after COVID-19
The changes that Covid-19 will bring, not even a crystal ball would help to predict. Changes occurred the crisis served to accelerate them. An evolution, or revolution, already brought news: startups of biotech, fintech, infotech … machine learning, AI, new generations with new behaviors … Many companies were already looking for alternatives to adapt to them. In organizations, will the role of the board and the CEO change? Should. How?
Among the activities of the councils, three themes should be given priority: the future, people, and risks. Councils have devoted (not to say spent) more time with the past and the present, than worrying about new paths to follow, scenarios that can be experienced, strategies and plans that can be adopted to face them. We call this “driving the vehicle looking in the rear-view mirror”. The impacts that this evolution can bring to companies, with greater or lesser intensity depending on the nature of their business, but undoubtedly impacting their operations, must be a constant theme in the agendas of the boards.
Greater attention should be paid to human capital. The new generations are a reality, in operational activities and acting as managers. New generations managing new generations. Their expectations, behaviors and motivational factors are different from previous generations; neither better nor worse, just different. And quite different. “People” must also be present on the agendas of the boards and the board members must try to understand in greater depth the characteristics of the people who work in the company. And act proactively in the optimization of the people management value chain.
Risk management should be given more attention by the board. “Living is very dangerous,” said the character Riobaldo in the work “Grande Sertão Veredas”, by Guimarães Rosa, “because nobody leaves this experience alive”. Therefore, living is a risk. A company lives and, therefore, its activities imply potential risks. Risk is inherent in any activity, and impossible to eliminate; knowing how to manage them – identifying them, qualifying them, being prepared to face them – becomes relevant to the success of organizations. And the board has a fundamental role in this, as it must make risk management a relevant management responsibility.
The CEO should support the board in these priorities and lead its development in the company. He is responsible for making that happen. However, human capital should be at the top of its list, as it should always have been, because without the right people, in the right place, at the right time, it can succeed, but it will not be lasting. You must ensure that a motivating culture remains for attracting and engaging people. Therefore, he must always ensure that the company takes care of its people as value and not cost, and that all managers understand the importance of each link in the people management value chain – from attraction to retention – and their role in that it is a leader’s most important responsibility: his teams.
The CEO should always be concerned with the company’s performance. However, you should dedicate more time to stimulate the spirit of internal innovation, and to monitor market innovations. The spirit of internal innovation does not only refer to products, but also, and often more relevant than products, to internal work processes and those that interact with customers and the community. Regarding the market, it must create in its managers the awareness that they cannot live only on what they traditionally do, and encourage them to take initiatives to monitor and understand any and all innovations that may bring reflexes to the company. Encourage them not only to take their heads out of the box, but to kick the box.
The world has not stopped; is in slow motion. Much attention is devoted to surviving in this challenging environment; it is essential to overcome it and survive the recession. If we do not win the now, there will be no after. For this, each company adopts the measures that are most convenient for them. But, boards and CEOs must, in addition to taking care of the present moment, put their minds into the post Covid-19 and start planning what to do next. There are different scenarios to consider and they must be considered in this planning.
José Luiz Bichuetti
Bichuetti was CEO of companies in the health, education, food, and industrial equipment sectors. He is a partner at Bichuetti Consultoria Empresarial, having worked as a consultant in strategy, corporate governance, management processes, turnarounds. Electronic Engineer from ITA, MBA from the University of Hartford, USA and postgraduate from Harvard Business School.