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KrisWalkerly

Recovery predictions and advice for clients

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KrisWalkerly

I'm curious to learn what everyone is predicting for the recovery and what advice we are sharing with our clients right now to help them prepare. I thought it would be helpful if we could share our thoughts here and learn from each other. For example,  I've appreciated Alan's prediction of  hybrid organizations that will have a mix of full time, part time, and subcontractors, as well as people working from home and in the office.  Here are a few things I'm predicting and advising with my clients, who are philanthropists:

  • A new funding model will be required because:
    • Some nonprofit organizations will deemed "too important to fail" (similar to banks during the Great Recession) because they are meeting critical human needs.
    • At the same time, there will be a perfect storm of insufficient nonprofit leaders to lead them: There was already a trend of nonprofit executive directors leaving the field before this crisis, we've had decades of insufficient nonprofit talent development, and many nonprofit executives will be so burned out by this crisis and lack of board/philanthropic support that they will leave the field in frustration.
    • As a result, foundations, corporate giving programs and donors will need to change their funding model to support critical nonprofits. This will mean working in partnership with nonprofits (as opposed to charitably giving handouts and requiring nonprofit leaders to jump through hoops for paltry funds) to ensure they have the necessary infrastructure, talent, technology, systems, governance, etc. to be successful.
    • This will require funders to embrace an abundance mindset, become more adaptive, innovative, agile, and increase their impact velocity.
  • There will be hybrid events in the near future, with a combination of virtual and in-person attendance
  • All philanthropists need to review and adjust their strategy right now (if they haven't already).
  • Associations will need to demonstrate that they are too important to be cut from their members' budgets. Philanthropy associations have been successful at quickly helping members learn from each other and respond to this crisis (e.g., weekly live discussions, rapidly converting conferences into virtual webinars). But they will fail if they aren't continuously adding new value to members.  During the last recession, foundations embraced a scarcity mindset by cutting professional development and association memberships out of their budget, and they will do the same in this next recession.
  • This crisis has laid bare systemic inequities, such as the digital divide and disparities in public education (e.g., in Cleveland, 40 percent of households lack reliable high-speed Internet and two-thirds are without a laptop or tablet suitable for education, so "remote learning" was difficult for most kids). Philanthropists should use their funds to transform systems and address the root causes of problems, instead of providing band-aid solutions (i.e., free backpacks stuffed with school supplies is nice, but hiqh-quality education for all regardless of zip code is better!)

 

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Becky Morgan

@KrisWalkerly

The manufacturing world was hit in very different ways, depending on industry. The priorities of recovery will be different as they are starting from very diverse positions.

One company tripled their business overnight, being a component supplier to ventilators.  In their case, a fast effective buildup was required; the future requires a planned leveling to more representative volumes by  year-end.

Another lost 85% of their business overnight, and is barely hanging on. If volumes don't return within a few more weeks, they will likely fold. They had recently made investments in people and equipment, both of which required money they wish they could access now.

Another lost major customers, at least temporarily, but picked up new ones related to healthcare.  And yet another is operating at about 80% of normal volumes as their customers slow orders.

When we see manufacturers move from making one thing to totally different products in days, we are seeing agile in action. When we see Dyson create a new ventilator in under two weeks, we see recognition and application of core competency—airflow--in action. When we see movie site finders help the New York government identify potential temporary hospital care locations we witness understanding that value is not limited to past markets.

Normal does not mean static. It is constantly evolving, as does business. Thinking strategically is the job of the leader.  That was true last year, this year, and next year. 

The world can be our oyster if we consider all the possibilities. The importance of clearly stating assumptions in all significant decisions cannot be overstated. The importance of triggers that alert us when our assumptions start to look questionable cannot be overstated. But don't wait and see.  Speed is your friend, time your enemy.

 

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Alan Weiss

What Becky said. 

I'm writing this on a break from a virtual Sentient Strategy certification morning. 

Oyster.

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Jason Borowicz

@KrisWalkerly

as a board member of a non-profit, we have found the funding model something for us to consider even before the crisis. A man-made poverty-crisis just accelerated our thinking. Along with funding models, we have also found trust models to be inherently broken, with some organization's like ours finding things like:

-in some countries, we have to act as Bond-like agents, as going through regular channels ensures donated monies or goods are not distributed to communities in need (ethnic or religious minorities), but majority groups;

-in some countries, we cannot trust the banking systems to deliver the money to who it is intended and for what. Even with Patriot Act level inspection, some relief organizations have found their funds have gone for arms and other munitions supporting groups with less-than-humanitarian ideals;

-in some countries, asking those we are helping to participate in the regular economy makes their problem worse, as monies in the regular economy go (to some extent) to actively work against the groups we are supporting.

These problems weren't created by the current combination of health and man-made crises, but I do think it offers a grand opportunity to re-think and re-build core systems at many levels in for profits and non-profits, as in business-as-normal, people wouldn't be so ready to consider change this grand. I don't know if this addresses your points per se, but hope it offers some dimensions to the thinking happening. 

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KrisWalkerly

@Becky Morgan thanks so much, I love your perspective and advice.

@jasonb@betterquestions.des I'd welcome the opportunity to talk with offline sometime regarding your experiences as a nonprofit board member and global donor. My original post was meant to spur sharing the advice we are all currently giving our clients and our predictions about the recovery, regardless of industry, but I'm always interested in talking about philanthropy and nonprofits! Plus I know of a few global intermediaries who might be helpful regarding your second point.

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Dean Robinson

Here's my prediction and/or advice based on working with family businesses in Australia:

1. Family businesses need 90 days Accessible Cash in the future.

2. 30% of all cafes, restaurants and other hospitality based businesses will fall over. They were marginal propositions at best pre-COVID 19.

3. Manufacturing will be re-invigorated in Australia. It's now a national security issue as much as an economic issue.

4. There will be a decentralisation away from Sydney and Melbourne (40% of the population). There will be a 2.5 hour arc around each city where people work from home and commute into the city one or two days per week for meetings. It's a combination of lifestyle and household debt management.

5. Trades based occupations will boom. We need people to build things and maintain what is built. There will be a big swing back to this, away from university focussed education.

6. It's not about revenue growth, it's about profit. Too many businesses focus on building revenues that are unprofitable or have no connection to their core businesses. Some are now finding this out. Others are quickly realising that dropping revenue is actually increasing profit.

7. There will be a renewed focus on domestic tourism. Some of that is as a result of our current tough border restrictions and our reduced ability to travel internationally. Some of it will be a realisation that we have such a diverse country that we've not explored enough (I've never been to Perth, but been to LA a dozen times!).

8. Businesses that are picking up work right now are the ones where the owners and key people have always been good at staying in touch with clients, prospects and contacts. It's Alan's 2 buyers a week philosophy. None of them are picking up work through social media platforms.

9. More education will be delivery remotely - and will be delivered to a timetable that suits the student, not the institution. That goes for secondary and tertiary education, skills based learning and CPD (Continuing Professional Development).

10. Retail will continue to experience a massive shift online and away from bricks and mortar stores. That will impact commercial rent rates,  which will then impact asset prices for commercial and retail property.

Kris, I find your comments around non-profits very interesting. It has made me reflect that, in the most part, charities and other organisation, at least in Australia, focus too heavily on events to raise funds. A number of them will experience significant financial holes this year as a result of restrictions of events and gatherings. I would think needs to be a re-focus towards fund raising via individual and small corporate donations for them to survive.

 

 

 

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Alan Weiss

Let's be careful here not to have endless predictions. While I find worth in all of these points of view, the empirical evidence is that almost all recent predictions have been inaccurate and sometimes damagingly so. Trust what you see.

What's the opposite of a  prediction? A post-diction? Here's my retroactive prediction: As Dean alludes to above, find your buyers the old fashioned way. The pandemic has not made relationships obsolete, it has intensified them. The restaurants and merchants we've supported are extremely cooperative and receptive. I've developed a new cohort of coaching relationships unlike any I've had before from nine countries in North America, South America, Asia, and Europe.

Building a brand and seeking referrals, combining "free and fee," and creating both virtual and physical offerings will continue to be the keys. The underlying supports of the American economy—the one with which I'm most familiar—are very strong, which is why the market is achieving escape velocity. Most of all, adopt the mindset of offering value to ideal buyers. You won't find them on Tik Tok. 

Finally, invest in yourself. Too often people who bemoan a prospect saying "the time isn't right, I have no budget" act exactly the same way themselves about their own development. 

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ColleenFrancis

Amanda and I had an invigorating conversation during my LinkedIn live broadcast yesterday. We talked about what we are seeing / hearing and what the future may hold. We both said after that the conversation spurred our creative thinking, plus we had a ton of fun!

You are welcome to listen in: Here is the link to the recording: 

https://www.linkedin.com/posts/colleenfrancis_an-interview-with-strategic-agility-expert-activity-6674354289529409536-Fb0L 

 

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Amanda Setili

Agreed - doing a live session with Colleen yesterday was not only super fun, but I feel like she and I created some great new ideas and content together, in the process. I so am thankful that Alan brought this community together, so that we can collaborate and learn together! 

Amanda 

 

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Alan Weiss

My pleasure. I'm glad it worked out so well.

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