Navigating your Organization in Times of Disruptive Change

The first two weeks of COVID-19 crisis management at dwarfs and Giants — insights into a self-organized company

How capable is a system to change and adapt when revenue drops by 85%? Insights from a self-organized consulting business — Pic: © Cris DiNoto via Unsplash
dG “All Hands”-meeting on March 18 to share current assumptions and a proposal by the steering team with all dG members.

We’re all in this together.

One of our basic principles — proposed by Karl Weick quite a while ago — is “react strongly to weak signals”. Hence, conversations about possible impact of the spread of COVID-19 were ongoing within dG for a while before the announcement. However, the announcement as such triggered a series of actions that were important to respond quickly.

  • The crisis will shift attention from organizational development processes (our core work) to crisis management and survival mode in companies.
  • The overall economic impact will increase the cost-sensitivity and trigger following cost-reduction measures of companies at least until the end of the year, if not longer — resulting in lower budgets for external support of organizational development work.
  • We therefore assume very little revenue from April to June (and after that, school holidays will follow, usually a slow season for our work) and increasing revenues starting September 2020.
  • We are all in this together. Any measures taken will be far more effective if we get commitment of all partners and employees involved.

Relax, nothing is under control…

After calculating six different scenarios considering all available measures including state-support we distilled two basic scenarios that would basically ensure survival of dG and sustain a minimum income for individual partners to cover their cost of living: A “worst case” scenario with almost no revenue till the end of this year and a “realistic” scenario with returning revenues by autumn. Additionally, we packed the necessary measures into a very concrete proposal on how to move on:

  • Reduce monthly payments of profit units of all partners to appr. 30%, providing advice that further distribution of profit at end of year is unlikely. Partners are warned so that they can take precautions for their own financial situation.
  • Apply for state-backed loan to safeguard liquidity.
  • Commit to a strict cost-cutting initiative.

Dynamic-Robust Organizing

Apart from these decisions, to ensure survival we took several measures to tackle important questions:

COVID-19 triggered a massive need for adaption, even for organizations with high learning capability. In times of crisis, is it possible to stay within the framework of an adaptive organization? Or is it throwing us back to the state of “securing survival”? (Slide from the virtual next:pedition Community Meet-Up, March 24, 2020)
  • How to focus attention and stay decisive?
    We amended both, our current strategies as well as our Governance to foster alignment and maintain the focus on what is important now. Leveraging our role-based setup for these quick iterations supports us in accounting for the new situation. After taking care of our housekeeping for some (intense) days, we turned our attention back to our clients, coming up with proposals how to jointly steer within the running projects and how to support them in the current context of Covid-19.
  • How to prioritize all ongoing initiatives and projects and eventually stop some of them in the light of the emerging situation?
    The General Circle and the Client Services Circle meet far more often to adapt priorities on a weekly basis and allocate resources accordingly. Additionally we reviewed our Company Focus Board (a Kanban Board to prioritize our resources across the different initiatives) and put everything on hold that is not serving at the moment.
  • How to focus communication and information flow?
    Two additional slack channels have been established: One for dealing with the need for information on COVID-19, political decisions and societal events, which might impact our business. Another one to monitor the very diverse consequences of the crisis for our clients in various industries. Additionally, we added new roles accountable for smooth and transparent communication of all activities and decisions to all dG members.
  • How to stay connected?
    We check-in virtually as dG tribe once per week to address the need of belonging and empathy for each other in acknowledging the different speeds to adapt to this new reality.

So what have we learned so far?

The structural setup works and is easily adjustable.
Before the crisis, our Anchor circle was more or less just a construct — not really vivid. Yet, in the last week we leveraged its power as integration point of the interests of people, the organization and the investors. All major decisions to ensure our survival were taken there with Consent decision making which proved to be smooth and fast.

evolutionary catalyst @dwarfsandGiants, passionate about #selforganization #responsiveorg #holacracy #purpose

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