Our founder and CEO, David Holme gives his perspective on the post COVID-19 business changes and challenges that are affecting organizations. With less emphasis on a particular industry or profession, he aims to shed light on the profound post COVID-19 business changes that are facing all business operations.
The stark reality is that there are exciting opportunities for renewal for business and any and all teams and service providers should be energized by these possibilities; that is certainly the view in the business I lead. But, like all changes, especially those that are foisted upon you, they can be (are) hugely daunting. There are more questions than answers, more change than the status quo. It’s time to reimagine the future; not the next 10 months, but the next 10 years. As we start to see the light at the end of the COVID-19 tunnel, I’ve noted five key COVID-19 business changes I predict we will see over the coming decade, and the ways we’re rethinking our business to take advantage of these post COVID-19 business changes.
Reimagine people as people, not employees
Yep, that’s right. Reimagine people, as people, not employees. The humanization effect of the pandemic means many corporates are seeing their employees as people, not staff. Through webcams, we have all had a literal view of our people’s lives. You’ve no doubt seen the kids, the pets, the gardens, the kitchens, and the partners of your colleagues and teams. This insight into their lives elicits a more empathetic relationship – everyone can see what the other is juggling in order to make this new normal work.
While working from home is not ideal for everyone, we are rethinking the entire journey in the light of the fact that people will be working in a substantially less rigid environment. According to the latest McKinsey article, companies will need to rethink their operating model based on how their people work best. “Sixty percent of businesses surveyed by McKinsey in early April said that their new remote sales models were proving as much (29 percent) or more effective (31 percent) than traditional channels.”
The entire employee lifecycle cycle will change: attract, recruit, retain, train, manage, and exit. The future will be about aligning talent with roles, regardless of hierarchy. To recruit for these roles, companies should create inspirational working environments and have a relentless emphasis on talent development so that the right talent can be recruited and retained.
Creating this type of employee experience will playback into seeing employees as people. And allowing working from home (post-pandemic) is only the beginning. Dolly Parton’s 9-5 will need to be rewritten as people understand work needs to be achieved by the deadline, not within prescriptive traditional hours that may not suit their lifestyles. The interaction with your boss and your boss’ boss will change; stand by for some dysfunctional behavior going online. Right now, we are in the honeymoon period. Employee effectiveness is about to have a rude awakening – in some ways for the better.
For legal teams within corporates, this is the first time we’ve been able to reimagine the entire function, according to our talent and business operations. Organizations have been forced to think in entirely new ways, so for legal, why not reimagine the needs of the business for the next decade not the last? Then see where people fit. I guarantee there will be a few wrong-shaped people for the next 10 years with these post COVID-19 business changes.
Traditional education is out; combined intelligence is in
The impact on in-house training, especially in highly skilled professions, will be profound. The ‘hands-on’ training element in all professions will need to be ‘professionalized’ regardless of the outcome of the current situation, which could catch many corporates unawares.
According to Forbes, e-learning is already predicted to hit $325bn by 2025, and that was before COVID-19 was even heard of. This figure will explode now as employers look to online training and mentoring as a way of re-educating their teams.
McKinsey advocates tapping into platform-based talent markets. This helps corporates to reallocate people quickly when customer needs, business priorities, or changes happen. It not only helps fills gaps where you need them but helps talented employees to expand their knowledge. McKinsey discusses the option of thinking outside of your own organization – channel partners, suppliers, vendors, and your entire ecosystem can help; “Chances are they will be more willing than ever to collaborate and share data and learnings to better ensure everyone’s collective survival.”
Moreover, education in the professions pre-employment is an expensive exercise that is rooted in the needs and traditions of the providers, not the needs of the employers. This will fundamentally change. As businesses look for talent, universities and educations will be forced to respond; are four years of school, and two years of articles really required? It’s unlikely. Instead, this is the perfect time for universities and corporates to work together. This has been happening; certainly, some of the Magic Circle firms in the UK have been doing this for several years, but now this won’t be considered a luxury, or just up to the big legal firms to go it alone.
Rethink technology; cut waste, think smart
Countless billions have been ploughed into technology in all areas, not least the legal profession, in the past decade. On the downside, most of it has been wasted investment, especially in legal technology (but that’s what you get as capital chases returns). On the bright side, many tools have become easy to adapt and mould for little cost.
We realized this about two years ago and started The Mind Factory (we all love a new name, even accountants) – a dynamic in-house team that helps us to rethink the way we do things – it’s our version of Lockheed’s now-infamous Skunk Works team, just with less secrecy. What The Mind Factory has taught me is that the power of mixing talents – math, tech, legal – has a massive multiplier effect. We’re rethinking a range of technologies. Imagine if you can take a complex case and have an end-to-end tool that is mathematically sound in case assessment and can be deployed from intake to outcome, for six figures?
Many of these analytics and predictive tools can be built on some amazing ‘stacks’ such as Microsoft – what these behemoths can give us is remarkable and largely unused. Buying bits and pieces is madness. A coherent low-cost strategy can yield extraordinary results – that is the future, not vanity projects.
My prediction is that, as with people, this will be accelerated, or should be. Given that, for many organizations, virtual reality is the only reality right now and digital channels the only means of engaging customers, employees, and suppliers, the challenge is going to be making this stick once we’re in the new normal.
In the legal space, what will hold this back will be a lack of belief, an innate cynicism, and budget. But technology must play a part in the ‘people experience’ and, more importantly, any client experience. It’s only by reflecting on changing customer demands and expectations that organizations will survive the next decade.
From a legal perspective, there are few with the range of skills to advise inhouse; the era of legal operations may just be called out for the sham that it is. Technology is not a vertical; it’s a corporate enabler.
Now is the time for legal departments to fully realize the value that technology brings. It was unacceptable before the pandemic; now there are simply are no excuses left for a siloed approach to tech and information. There is an inexpensive path to realizing this value, but will legal departments take it?
Very few legal departments are fit for today’s challenge much less the next decade. Be bold. Have a vision.
The competitive landscape has already changed
It’s stating the obvious that this is going to be the most dynamic change for at least a generation. Some will emerge with scars, some will not, but the best-in-class will emerge, blinking into the light of a new landscape.
This means, of course, that there will be consolidation opportunities abound. My advice: take them. There will be many in the legal space hurting and the most well-financed in the sector (likely the Big 4) will think it’s Xmas come early. Although later down the line this is likely to have far-reaching consequences when it comes to any potential breakup of these giants.
The entire deal-making process will change. Which is a good thing. The speed of deals will increase but for that to be successful, diligence must be modified. It’s time diligence reflected the reality that current trading is the key, not cashflow from 2017/18. Will banks, lawyers and accountants understand this and move quickly enough to keep pace? I am not so certain. But diligence will need to change.
More importantly, the cover must be blown off when it comes to supplier agreements and relationships that sit in silos when it comes to M&A activity. This has already started to happen. We are seeing immense demand for our AI contract discovery tool because organizations have realized that siloed thinking and segregated views of supplier relationships can cause massive delays and impede lucrative M&A deals.
Moreover, data has followed traditional lines, meaning that both the buyer and supplier have at least three views of the relationship they really have. Have the conversation – oddly Zoom and remote working might be the greatest breakthrough to cooperative M&A and supplier relationships since well… the office.
Think strategy with suppliers and think 2025
Staggeringly, many firms are still siloed between finance, legal, and procurement. A CEO can often feel like a referee (these days in an empty stadium). How did we get here? The lessons of 2008 have not been learned; that shared data empowers a corporate’s position. There are, of course, those that get this, but not terribly many.
While these three functions remain in their own walled gardens, suppliers will continue to be treated inconsistently in the procurement and legal contracting process. Much like the humanization of your people, now is a time to consider a more nuanced approach to suppliers (and clients) with a combined approach from vendor departments. This could be achieved using a balanced algorithmic approach supported by judgment – a human method supported by technology to align the facts. Guesswork belongs to yesterday; it was out of date in 2008.
Our organizations will be judged in this era. Not just by employees and clients, but by suppliers and our entire ecosystems. How we handle this crisis, what priorities we had, and most importantly how we support each other to work towards the light, will be noted. I am hopeful that a new approach, without silos, and with technology+human is possible, but silos are entrenched especially when fingers start pointing in stressful times.
See the light. These are significant changes and new philosophies. Some will make it, and some will not. What I believe is true is that the same people will resist these changes, and a new generation will emerge faster than many are comfortable with.
This isn’t a time where the art of persuasion is the key skill. There is light at the end of our global tunnel and while the ability to see the future is helpful, the critical success factor will be to have the courage to act while still recognizing the risks.
What do you think is in store for us all over the next decade? Are there additional post COVID-19 business changes you see? It would be great to hear your thoughts. Feel free to email me directly or connect with me on LinkedIn. Be well.