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Transformational Change is the Name of the Game

How to create a change-ready organization through a culture of play.

The past few years have felt like anything but a game – unless that game is Monopoly and you’re losing to your older sibling after landing on Park Place for the eighth time. In this case, the taunting sibling has more teeth: global pandemics, social reckonings and war. 

All of these factors have shaken people’s sense of safety, identity and trust. And these challenges have required companies in every industry to accelerate transformation—something that’s difficult in an environment where people are exhausted, frustrated and, at times, scared.  

Fortunately, many companies are heeding the call to take care of their people with 90% of employers reporting an increase in investment in mental health programs (come on, the other 10%!) according to Wellable Labs’ “2022 Employee Wellness Industry Trends Report.” 

And while holistic well-being is incredibly important, work itself still lacks the humanity (the human beings in “well-being”) needed to sustain change. But that’s where play comes in. Forgive the pun, but it plays a part in the transformation.  

What is Play and How Does it Tie Into Transformation? 

Prophet’s Change Fitness Model reflects the different starting points for how companies see and address change, ranging from the transactional belief that “change is an obstacle to overcome” to the transformational state of play where transformation can be a sport to be enjoyed. 

You can think of play as “batteries not included.” Because, given the constant nature of change, those who have achieved play can spend less energy overcoming each effort and more time being fueled by it.  

So how do you get to the state of play? Exactly—you play!  

Scientists Meredith Van Vleet and Brooke Feeney define play as: A behavior or activity carried out with the goal of amusement and fun that involves an enthusiastic and in-the-moment attitude or approach, and is highly interactive among play partners or with the activity itself.  

Applying this lens to work clarifies the opportunity–making work that people enjoy, that brings out enthusiasm and deepens connections.  

The skeptic will say, “We don’t have time for play – we have work to do!” But those ahead of the curve see the intrinsic need to link the two. Better play means better work. In fact, in a 2019 study by Brigham Young University, teams that played video games together were 20% more productive than others.  

That’s because play unlocks creativity, helping people tap into new sources of inspiration and ways of thinking—which creates better solutions.  

And, especially at a time when the universe is playing chess with humanity, play creates sustainability and safety, encouraging people to enjoy what they’re doing, so they’ll want to do it more. And it deepens skill building, encouraging trial and growth in new ways. Checkmate. 

Of course, play is easier said than done and toxic environments will reject it. People can’t experiment if they believe their job or reputation is at risk. They won’t be themselves if they don’t like the people they’re working with. And they won’t prioritize play if they’re getting mixed or conflicting signals from leadership.  

Play shouldn’t be isolated to an innovation team, a single brainstorm, an occasional company outing nor the funniest person in the room. Play needs to take place across all levels and contexts – across a company’s culture, teams and individuals. Each reinforces the other with a company’s culture making it easier for teams to be able to play, and individuals bringing their whole selves to both innovation and the everyday.    

How to Create a Culture of Play Within Your Organization  

So how might you best implement a culture of play? We couldn’t not use the SMILE acronym, could we?  

Safe 

No one wants to play “the floor is lava” with actual lava. People need to feel safe in their environment. That means feeling confident that they can make mistakes and learn from them, not be punished by them.  

According to Peter Temes, founder and president of the Institute for Innovation in Large Organizations (ILO), “that hasn’t changed since we began this work 15 years ago, and probably hasn’t changed from decades prior to that—this idea of lowering the cost of failure.”  

Leaders can create safety by modeling and being transparent about failures and growth opportunities. Most importantly, leaders’ actions must speak louder than words – when individuals fail, they need to celebrate those learnings, not focus on the implications. 

Leaders can also help create a sense of safety through joy and levity in the workplace. Jennifer Aaker and Naomi Bagdonas, authors of “Humor, Seriously,” have shown that companies that embedded humor in their culture had employees who were 16% more likely to stay at their jobs feel engaged and experience satisfaction.  

Meaningful 

By nature, games have stakes and meaning – it’s what makes them exciting and, as defined above, creates the enthusiasm that creates play. Giving meaning to play can take many forms.  

One way is through reinforcing an organization’s purpose, helping people see why their work matters. Some companies create meaning through competition – whether individual incentives, team challenges or by focusing on external competition.  

One company created an internal fantasy league, resulting in an 18% increase in outbound calls and an increase in morale. Making play meaningful like this can be a great cause for celebration and recognition as well—reminding people about why they need to be invested in what they’re doing. Of course, “meaningful” must be rooted in safety – if people fear the stakes are too high, that fear can hold them back.  

Individual 

Everyone’s favorite radio station is WiiFM – “What’s in it for me.” Ask someone about a project they’re working on, and they might smile. But ask them what they did this weekend, and they’ll light up—even more so if they get to talk about personal hobbies or passions.  

Create more ways for people to light up, and you’ll create more ways to unlock that joy and translate it into their work and relationships. At a systemic level, consider how you’re fostering individuals’ passions and making them feel heard and represented. And at a team and day-to-day level, find ways to share them.  

Linked 

On the other side of the “individual” see-saw is the need to bring people together. Often, people have more fun working with other people, and collaboration creates those all-important feelings of togetherness and belonging. Prophet’s 2022 Catalysts research: The Collaborative Advantage finds that employees achieve better outcomes personally and professionally when they collaborate – 65% of respondents cited higher levels of productivity as a result.  

In hybrid environments, it becomes more challenging, where it may seem like people are working together on endless transactional Zoom calls. In reality, there is a shrinking emphasis on true connections which require smaller group interactions and a mix of both work-related and non-work-related focuses.  

Exploratory 

People need new inputs to get to new outputs. Trying a new dish can be more fun and exciting than eating the same meal for the fifth time this week. Consider how to fuel people’s joy and creativity by putting them in new situations, hearing from new voices or thinking about things in new ways. Then, use that space to give people a chance to get their hands dirty, safely.  

Build in the flexibility for exploration. A global airline used the power of play to teach the organization its seating pricing strategy. Leaders used a game of “The Flight is Right,” taking the principles of “The Price is Right” and applying it to the complex principles that airlines face. By approaching the learning in a new way, and allowing people to play and participate, the message stuck.  

LEGO’s serious play methodology is another great example of encouraging exploration to envision challenges in new ways while tapping into the joy of being a child.  

The creativity expert, Edward De Bono, describes “Rivers of Thinking” – the building nature of experiences that help us to unlock new solutions. When we fill our rivers with the same water, it becomes difficult to explore new ones.  


FINAL THOUGHTS

Play isn’t a moment in time or something you do outside of work. Organizations can use the power of play to create a sense of safety in the workplace, give employees a purpose, and build trust– all factors needed to accelerate transformational change in an organization. 

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How Does an Economic Downturn Impact Your Transformation?

When recession fears increase, companies usually pull back. However, the smart ones know that navigating turbulence builds resilience and exposes growth opportunities. 

News that global markets are either in or inching toward a recession is creating uncertainty, causing many companies to consider pausing or reducing transformation initiatives. However, history has shown that challenging economic times can often lead to the urgency that stimulates profound innovation.  

For decades, recessions have accelerated change and given birth to giants. Some examples include Hewlett Packard and Hilton in the 1950s; Microsoft in the ‘70s; and new economy brands like Uber, WhatsApp, Venmo, Instagram, Airbnb, Slack and Dropbox all roared into life during the Great Recession, which began in 2008.  

New platforms and operating models–from the sharing economy to subscription models to crypto–rise in times of uncertainty. And legacy companies may have a competitive advantage if they have the right components in place. These unpredictable markets offer unexpected opportunities for established companies. Consumers develop new needs and behaviors causing competitors to change tactics and reveal new white space opportunities.  

We’re not saying it’s easy to shift course to address these changes, but those ready to step up to the challenge often find exceptional growth, even when competitors struggle. 

Incumbents can significantly capitalize on this advantage if they start to act more nimbly, leveraging their strengths and leaning into risk. In many cases, consumer trust in their brand proves invaluable, giving legacy companies permission to capitalize on new consumer behavior with new business models.  

Organizations that have already started transformation efforts have a clear advantage. Many that were proactive during the pandemic have positioned themselves in a way that increases their chances in achieving new growth. This is especially true as they emerge from the downturn. But these organizations will need to address the scope and renewed urgency of change within this market by meeting it head-on and accelerating their transformation. Recessions alone are transformational – altering the economy, consumers and the competitive landscape. Just as the pandemic required adapting to new ways of shopping, working and doing business, this new terrain will undoubtedly bring its own paradigm shifts. 

While accelerating is crucial, the environment transformation leaders currently face is rife with risk. Leaders need to unlock ways to confidently readjust their transformation strategy and approach. 

The challenge to not only transform, but to do so at an accelerated pace in a down economy, requires a new approach. Mike Leiser, Prophet’s chief transformation officer, recommends leaders take a uniquely human view through the lens of our Human-Centered Transformation Model™. This model requires a shift in thinking that will help organizations unlock and accelerate transformation.  

“Businesses don’t change,” he tells us. “People change, and people change businesses.” 

This is particularly true for legacy companies. They often have the capacity to fund transformation but need to overcome significant obstacles, including older operating models and antiquated talent incentives. We suggest starting with some hard questions about each interrelated dimension.

Organizational DNA Focus on Core Transformation Strategies and Driving Near-Term Value 

Consumer needs and behaviors are dramatically different than those pre-pandemic, and it’s unclear how today’s inflation and rising interest rates will affect them over the next down cycle. These fundamental shifts will require leaders to evaluate their transformation priorities and roadmaps. However, with all areas of corporate spending increasingly under the microscope, transformation leaders will be called to show immediate impact and results. Very few companies will have the luxury of thinking in long-term “moon shots”, prevalent in stronger economies.  

To get a better sense of potential changes, Prophet reached out to several experienced transformation leaders who have weathered the storm of a past recession. One such veteran is Stephen Crowley, former SVP of ATM technology & operations at Bank of America, who found himself in the eye of the financial crisis in 2008. 

Crowley explained that, at the time, ATM and check depositing was still a modest business. But when it transformed toward digitizing 25% of all checking deposits, the effort became a massive, yet pivotal play to differentiate itself from other banks. The company radically accelerated its timeline, moving up goals and pouring support into an entirely new way of operating ATMs and check processing centers. 

He shared his key lessons in connection with successfully doubling down on the vision:   

  1. If you want to focus on the business case around transformation in this economy, concentrate on customer experience–people can defect quickly in a downturn. For Crowley, that required standing in front of a thousand ATMs to watch customers make deposits.   
  1. Think about what kind of paradigm shift is happening and what’s transformational about the process itself. From a timing perspective, Bank of America was positioned to succeed where others had previously failed because smartphone technology had caught up to facilitate the transformation. 

Questions to Help Clarify Transformation Strategy:  

  • How are customer and employee behaviors shifting? Spending habits? Lifestyle changes? Priorities?  
  • Are competitors creating new growth opportunities that fall under our North Star? Are there opportunities to divest non-core businesses? 
  • Is there a compelling business case, measurement and governance model for the transformation strategy as costs are being cut? Will this transformation help drive growth during a recession? And beyond?  
  • Given market changes, are the transformation vision and roadmap still relevant? Can it be executed faster? 

Organizational Mind and Body: Manage the Skillsets and Muscles Required for Change 

Within this environment of unknowns, it’s critical to understand how organizations will continue to drive momentum on transformational initiatives. That’s where the mind–the skillsets–and body–the operating model to support transformation–come in. In doing so, it’s essential for leaders to go beyond just thinking about processes for transformation.  

Leaders must understand their organization’s aptitude for change, which requires addressing past successes, underlying culture and the values that are going to introduce agility – particularly as leaders seek to accelerate transformation in this down market. 

Many organizations are already on this path, thanks to the pandemic. In a matter of months, they provided their workforces with new flexibility and upskilled them with digital collaboration tools, maintaining and even increasing productivity. Many organizations also expanded digital and online capacities to strengthen customer relationships and reconfigure supply chains. They did this by leaning into change and building organizational muscle. These organizations now know–as do their employees–that they can get through the storm and thrive. It gives them the confidence to do more in this environment, although the demands for organizational change will continue to evolve. 

In an uncertain, cost-sensitive market, leaders need to encourage unexpected, rapid solutions. Therefore cross-organizational collaboration is essential fuel for accelerated transformation, allowing leaders and teams to break down silos to creatively build new solutions for value – giving them the ability to do (exponentially) more with less.  

While this is still a challenge for most companies, our recent research finds that the more organizations promote this cross-functional work, the more successful they are. Employees see themselves as more productive and value the personal and professional growth that collaboration brings. 

Secondly, the organizational mind needs to be primed to succeed amid risk, especially in a recession. “When you reward employees for healthy risk-taking, there’s a willingness to try new things,” says Matthew Perry, former vice president of foodservice sales at Kellogg Company. This pro-risk perspective allowed Perry to establish notable food product innovations during the Great Recession – many of which developed from rapid ideation and experimentation. 

Perry believes succeeding in a down market requires empowering the workforce with new skillsets and growth opportunities. There are some clear actionable “mind” focused areas organizations can address to ensure employees are able to weather a down market environment:   

  1. Reward employees with healthy risk-taking and willingness to try new ways of solving problems. This will be a stretch for some who might not be suited to this environment, but, with the right support, many will be more willing to try. 
  2. Empower your workforce with new skillsets and personal growth opportunities that directly relate to the transformation at hand, making their role more relevant and connected to it. Additionally, make it clear that these skills encourage personal growth no matter what the ultimate outcome is. This is especially meaningful in tough times. 
  3. Encourage employees to lean into collaborative and cross-disciplinary teamwork. This speaks to the “body” and allows teams to action and accelerate transformation. When the environment demands that all leaders do more with less, encouraging employees to lean into collaborative, cross-disciplinary teamwork is a win-win. 

Questions to Build the Organizational Mind and Body: 

  • Do structures support transformation in an uncertain and fast-changing environment?  
  • What skills do we need to get where we need to be? 
  • Are teams and employees empowered to collaborate quickly to produce unexpected solutions in the face of market challenges? 
  • Where can more agility, integration and experimentation be encouraged? How are hybrid work policies helping or hindering collaboration? 
  • How are employees rewarded for actively stretching skillsets? For taking risks? 

Organizational Soul: Design Communication for Intentional Motivation, Connection and Comprehension 

Employees are every organization’s greatest resource. Teams who embrace and thrive during tumultuous times are key to transformational momentum. That’s why tracking and managing morale around transformation efforts is essential–the entire workforce is paying attention to what leaders say and what they do.

The past several years of change have often left employees too cynical to believe in transformational efforts. Couple this with informal information, and rumor mills go into overdrive, often based on real fears. “Will there be layoffs? Am I safe here?” It creates a significant barrier to realizing transformational goals. 

Communication is the best tool to emotionally manage change and build morale. We’ve found it’s essential to provide clear, consistent communication about the strategy, and it’s also important to honestly and transparently report how the transformation is going. Most of all, leaders must acknowledge all the people impacted by the change. Employees should feel connected and a part of it all. Taken together, this builds a culture of resiliency. 

Prophet’s recent research reveals a common trend: Accelerating transformation requires a motivated workforce with democratized decision-making. Leaders need to lean on mid-level and junior-level employees more heavily, meaning morale needs to be nurtured more carefully. 

Deepak Agarwal chief information officer at the School District of Palm Beach County, Florida, shares that leading the digital transformation of a 27 thousand employee school district wouldn’t have been possible without an emphasis on strong communication. From 2008 to 2012, thousands of employees needed to adopt an entirely new set of operational and educational tools. He believes that the COVID-19 era has created a greater need for communication.  

“Leaders need to ask how they can make employees’ work and lives better as they support and adopt transformation initiatives,” he says. 

Agarwal sees three interrelated ways he successfully motivates colleagues and teams: 

  1. Leaders must provide strong communication systems and clear messaging about what changes are happening and when. Doing so will help employees engage during transformation. 
  2. Create better knowledge management systems to educate employees and train them. 
  3. Give employees better feedback tools so leaders can monitor how employees are feeling about the change.  

This approach allows employees to feel valued, valuable and motivated to drive transformation forward.   

Questions to Inspire Morale: 

  • How well are transformation messages getting through? How thoroughly do all employees understand progress reports? 
  • What is the process for making shifts in messaging when required? 
  • What can leaders do differently to strengthen the purposeful connection between employees and the transformation? 

Learn how to turn up your business in a downturn economy with Prophet’s Transformation Training.

Over the course of a one-day session, our team of Transformation professionals will evaluate your organization’s readiness for innovation and uncover near-term opportunities to accelerate your growth.

Please contact Kristen Groh, senior transformation partner, to host a Transformation Training with your team today!



FINAL THOUGHTS

As leaders look ahead to the next year, they will need to acknowledge that the latitude for risk is narrowing. Although nothing is certain, applying a Human-Centered Transformation Model™ allows leaders, particularly incumbents, to be more precise about their transformation. Transformations do pose risks, but there’s also a cost to failing to transform. Changing markets and customers require organizations that change, too. And those that transform effectively will achieve new growth and win against the competition. 

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The Equation for Growth in Healthcare: Customer-Centricity, New Skills and Balancing Brand and Demand

Prophet recently hosted a healthcare leadership roundtable, moderated by John Ellett, focused on driving uncommon growth in healthcare today. Read the takeaways.  

These were the takeaways from Prophet Healthcare’s leadership roundtable, moderated by John Ellett, which focused on driving uncommon growth in healthcare today.  

Attendees included: 

We convene for these discussions a few times a year so leaders from different subsectors and functions can compare notes and share insights. The latest session was all about growth – where it is coming from today, how senior marketers can make it happen and who needs to be on the team.  

Key Takeaways for CMOs and Growth Leaders Across the Healthcare Ecosystem 

Play the Long Game of Innovation 

In healthcare, innovation takes many forms – from new product launches and optimized experiences, to M&A and business model innovation. But no matter the approach, and whether we’re talking about startups or large enterprises, innovation requires both a long-term perspective and a sense of timing. It can take years to develop, say, breakthrough technology, but if the market’s not ready for it, new offerings might not take off.  

Relative to growth, innovation must be viewed in the context of core value propositions, as well as future impacts. That means knowing what really moves the business and understanding what innovation will deliver (e.g., future revenue gains, increased profitability, brand differentiation). The support of senior leadership is key to keeping the organization’s eyes on the prize across long time horizons.  

Solve for Talent 

Executives agree that talent is as important as ever, even as marketing becomes more tech-driven. A few firms were looking for more skilled strategists to set the direction for marketing. But more are looking for tactical and functional expertise to execute growth strategies. There was consensus that “even the best strategy needs worker bees.” Ideally, workers will be self-starters who understand big-picture objectives, think analytically and measure results. As with growth itself, there seems to be no such thing as too much talent. 

Focus on The Perennial Value of Customer-Centricity 

As much as marketing has changed, customers remain the perennial focus. Everyone agrees that customer insights should be the core of all growth strategies. But participants also noted that it’s easier to say “we’re customer-centric” than to integrate the voice of the customer throughout all brand and marketing efforts, especially when targeting new segments. Many felt CMOs are uniquely positioned to maintain the powerful link between such customer-centricity and growth, including building stronger customer communities. In fact, being a “customer advocate” might be the most important responsibility CMOs have. 

Recognize it Takes a Network 

As healthcare leaders face an ever-expanding range of growth possibilities, the importance of internal and external networks grows more important. Asking the right questions of mentors, peers and external advisors is key to staying ahead of important industry developments. Socializing and testing your own vision is just as important. A strong network can certainly provide tips and insights relative to engaging customers in new channels. On a larger scale, they can shed light on how new technologies, ecosystems and partnerships, as well as business models, will impact growth strategies over the longer term.  

Balance Brand and Demand 

Senior marketers and other growth-oriented leaders across industries are trying to balance brand-building and demand generation investments and activities. (Check out Prophet’s blog series on this very hot topic). Demand strategies are easier to measure, a huge advantage in the multi-channel digital world. However, because of the unique nature of healthcare where relationships are at a premium, brands remain critical to building trust with consumers and patients. 

One participant mentioned the classic formula of “40% demand and 60% brand,” but the optimal balance will vary based on an organization’s customer base, growth strategy and market position, among other factors. Because both “brand builder” and “performance marketer” are inherent parts of their job descriptions, CMOs must continue seeking the right balance, and recognize that it will evolve continually along with market conditions.  


FINAL THOUGHTS

From the most effective channels and platforms to new media that might emerge, to new rules for customer engagement, the only thing that seems certain about the future is that CMOs and growth leaders in healthcare will keep watching developments closely and comparing notes with peers and colleagues.  

If you’d like to participate in future healthcare roundtables, please reach out to Paul Schrimpf or John Ellett.  

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The Future of Your Organization is Human

People aren’t robots. In a changing environment, companies shouldn’t be robotic, either.

It’s a truth older than Darwin: The ability to adapt grows more valuable whenever uncertainty in the environment increases. With the world’s markets tiptoeing toward recession, companies have the opportunity to make their next evolutionary leap–the chance to become more human.  

We know –”more human” doesn’t exactly sound like how we’ve traditionally been taught to think about organizations. Businesses have spent the last two decades pursuing digital transformation and embracing artificial intelligence and advanced robotics–technologies that generally assume tasks previously reserved for humans. Additionally, business leaders have spent the last two centuries absorbing the Industrial Age organization theory, painting organizations as machines. 

However, enterprises are not machines and people can no longer pretend that they are. Organizations are living organisms with behaviors and abilities like the humans who staff them. 

The last few years have made that clear. Profits, while essential, aren’t all that matter. The market’s definition of success has shifted, and while people still expect organizations to make money, they increasingly value environmental sustainability, social equity and inclusion as well as efficiency. They expect human behavior–that means ethical, compassionate and transparent–from the companies they do business with.  

Organizations can’t behave like single-minded robots to thrive in this new era, marching mindlessly toward the next quarter’s financial results. They need to evolve and become more complex, adaptive and creative organisms.

Three Ways You Can Build an Adaptable Operating Model  

Adaptability is an acquired skill, and enterprises can take inspiration from our own human biology. We see three critical ways companies can evolve their operating model to become more adaptable and flexible, using the human body as a starting point.  

1. Distributed Intelligence 

People’s bodies can react quickly without involving the brain. Think about knee-jerk reflexes or yanking a hand away from a hot fire. 

Organizations do the same thing when they empower people to take action throughout the company instead of having all decisions centrally controlled by a handful of leaders.  

In a pharmaceutical company, for instance, engineers and planners can be embedded into production teams so they can deal with any issues locally, continually improving performance. The production quality gets improved locally and immediately, without involving the company’s central leadership. 

This pivot to decentralization is evident in flexible manufacturing. For the pharmaceutical industry, for example, this concept is increasingly important when using cell and gene therapies to make advanced biologics. Often, these drugs are aimed at small patient populations, especially in oncology. Manufacturing cells need to reconfigure quickly to respond to market needs and be first to market. 

It shouldn’t be local intelligence and action versus global intelligence and action. It’s about both. The human body has neurons in muscles, gut and extremities as well as the brain–and so do organizations.  

2. Learning Through Data 

Our brains learn through external stimuli, and people’s knowledge and capabilities represent everything they’ve individually learned or experienced. In other words, they are built by the data available to them through the senses. That’s why neural networks, modeled on the structures of human brains, can only be as smart as the training data available to the model. 

For organizations to be more nimble, they need better and more frequent access to data of all types. They need to develop robust “sensory organs”–mechanisms to ensure they intimately understand customers’ needs, wants and desires. And they need to feed that data (as real-time as possible) into organizational decision-making.  

That’s especially true for design functions, so that customer and employee experiences adapt to the needs of 21st-century consumers. Many companies believe they already do this, of course. But in adaptive enterprises, it is as natural as the human eye adapting to bright sunlight. 

Samsung has built regional design studios around the world, which leverage design thinking and market knowledge to rapidly innovate. With its main hub in San Francisco, its multidisciplinary designers help it tap into the entrepreneurial spirit of Silicon Valley. That enables it to reign as Apple’s most formidable competitor.

3. Embrace the Ecosystem 

Humans are exquisitely social animals. Most of us cannot exist independently from one another. Societies are complex ecosystems, with people mutually dependent upon one another for survival. And as environments have changed, new civilizations have grown up in response to new human needs. 

In organizations, this spurs ever-expanding ideas about partnering and collaborating with other organizations. Technology incubation centers have spawned new developments–enabled by these networks and connections in ways that didn’t exist even a decade ago. It’s driven by sharing platforms– companies like Uber and Airbnb–and the subscription economy, led by companies like Salesforce and Apple. 

Thriving in a VUCA World 

There’s no escaping the VUCA (volatility, uncertainty, complexity, ambiguity) world we live in today. Organizations are still scrambling to embrace the changes wrought by the pandemic, including shifting customer values and hybrid workforces. And while the recession is by no means certain, rising inflation, energy costs and interest rates are pressuring consumer and B2B customers.  

But organizations are by no means helpless. These sweeping changes offer opportunities for evolution and adaptation. For some, it may even be the right time for organizational transformation, including a new approach to human-centric operating model design. And no matter what, this uncertainty requires an entirely new approach to collaboration, a holistic view of the organization that takes in a company’s eyes, ears, heart and soul–as well as its brain.  


FINAL THOUGHTS

Companies that want to thrive in a changing environment can do so by being less like the robots they used to be and more like the humans they serve.  

Want to understand how to put your organization on a path to become more human-centered? Get in touch with one of our experts. 

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Transform Your Financial Services Retail Experiences with These 9 Levers

9 key levers across 3 development stages, each enabling financial institutions to transform their retail experience towards the future.

In many Asian markets, financial services companies used to grow alongside the macro economy and compete heavily on products. But things are changing. Product innovation within established incumbents is becoming more difficult under a slowing economy and tighter regulations. Fintech companies are disrupting legacy brands – with offers across saving, credit, insurance and more. The new generation of consumers is increasingly looking for more than short-term returns. These macro shifts indicate that in the future of financial services, reimagining the customer experience and offering benefits beyond transactions will be critical in driving sustainable, ownable growth.  

Study1 shows that nearly 70% of Asian financial services companies understand the importance of “customer-centricity,” and are investing heavily to improve digitally enabled customer experiences (CX). Yet surprisingly, only 20% of customers consider FS companies providers of truly “customer-centric” experiences2. This gap is not a favorable truth but indicates a great opportunity for a company to take action and lead the future. We have identified nine key levers across three development stages that will enable financial institutions to transform their retail experiences for the future.

Fix the Basics: Become a Financial Services Company that Meets Customer Needs 

1. From “Experience” to “Branded Experience” 

Speed and convenience have become critical for customers in the modern digital world. But focusing efforts solely on “ease” also tends to create very similar sets of experiences and/or functions. So how can a company cut through the clutter?   

The answer is simple: brand. A solid brand strategy clearly defines what promise a company makes to its customers and how it uniquely delivers on the promise. Next, this will be translated into a brand identity system that closely aligns with the strategy and guides the development of truly ownable experiences.  

For many financial services companies, brand has not been considered and managed as a strategic asset. Therefore, before aspiring to create any signature experiences, companies need to build a solid foundation first by carefully looking into their brand strategy and identity to define their own experience principles. 

2. From “Product Distribution” to “Omni-Channel Experience” 

Internet companies and FinTech pioneers have disrupted and transformed the retail side of financial services (e.g. Ant Finance and Ascend Money). Many companies now rely heavily on these platforms to broaden their reach to retail customers. But platforms can be restricting, and the company could face constraints in building distinct experiences and owning customer relationships.  

As a solution, some leading companies have started to invest in their own digital ecosystem. For example, Fidelity created SmartRetire, a one-stop retirement solution platform. By building their own digital experience, companies can not only design and own the customer experience, but also collect data to enable targeted, more relevant engagements, that in turn can improve the customer journey in the long term.   

If creating owned ecosystem is not feasible in the short term, companies should at least build a holistic plan across touchpoints and identify opportunities to maximize owned experience and relationships. 

3. From “Experience as External Resources” to ‘Experience as Internal Center of Excellence” 

Many financial service providers leverage third-party vendors to deliver service and experience at lower costs. However, service quality could be at risk under this outsourcing model and differentiation could be harder to sustain if the vendor relationship is not exclusive.  

Companies should prioritize experiences that are most desirable to customers, viable to businesses and feasible to execute, building an internal “center” that breaks the silos, connect the dots and assures quality. A strong center of excellence enables great experience from within, bringing higher efficiency and sustainable competitive advantage in the long term.  

Excite with Experiences: Become a Financial Services Company that is Loved by Customers 

4. From ”Fill the Pits” to ”Elevate the Peaks” 

There could be a huge perception gap on “excellent customer experience.” Research3 shows that 80% of financial services companies believe they deliver excellent customer experiences, while only 8% of customers agree. One of the reasons behind this is that most companies focus only on fixing the pits upon functional pain points, but not on creating any peaks that delight and excite customers in memorable moments. 

Customer lifetime could be quite long in financial services. To become a company that customers choose, trust and love, companies must build a holistic view of the customer lifetime journey, by identifying and prioritizing moments that matter and creating signature experiences that customers truly desire.  

5. From ”Transactional Moment” to “Real Life Relationship”  

Many financial services companies are facing infrequent interactions and transactional relationships with customers. Research4 shows that 60% of Asian customers have had zero engagement with their financial service provider in the past 18 months.  

To go beyond the transactional moments, companies should look to expand their role and presence in other areas of customers’ everyday lives through partnerships and co-branded experiences. For example, Neo Bank MOX in Hong Kong partners with merchants favored by its customers and provides exclusive cash back. Another example is insurance company Beam, which partnered with a smart toothbrush brand and launched an oral health solution, offering premium incentives based on customers’ usage and behavioral data. 

Companies should take a broader view of the customer journey, identify opportunities to meet people where they are in life and enable their lifestyle beyond financial needs. With expanded partnership and engagement, companies could also build an enriched understanding of customers on top of transactional data and enable future products and service innovations. 

6. From “Data Enabled Personalization” to “Human Enabled Personalization” 

Research5 shows that 80% of financial service customers desire more personalized experiences. In Asia, customers are 1.5 times more willing than customers in Europe to share personal data in exchange for personalized experiences. Yet it takes time to build data and analytics capabilities that enable meaningful personalization at digital touchpoints. Customers in Asia also still desire a certain level of in-person engagement – even in younger customers, research6 shows more than half believe financial services are not human enough.  

So, while building data capabilities, companies should invest in empowering their front employees (e.g. RMs, agents) to deliver better, more relevant experiences with smarter tools and insights (e.g., need analysis, claim tracking). These tools should be designed not only to enable higher quality engagement but also to capture customer insights/data into the centralized database – to maintain customer understanding and relationships at risk of potential people turnover.  

Lead the Future: Go Beyond the Frame of Reference as a Traditional Player 

7. From “Proactiveness” to “Intelligence”  

Customers are increasingly sophisticated and their expectations will rapidly evolve. Being “proactive” will become a table-stake part of the experience and companies could aim to lead by creating “intelligent” experiences that are three steps ahead with AI technology. In 2021, HSBC HK saw 10 times higher engagement between relationship managers and customers when it leveraged AI to offer 22 thousand different sets of wealth management solution advice to individual retail customers7

Deep learning and hyper-personalization are among the top strategic priorities for CX leaders in 20228. Leading financial service companies should not only identify close-in use cases, such as product innovations or credit risk assessment but also stretch-out use cases that help the company go further into customers’ lives. 

8. From ”Valued Customers” to “Empowered Customers” 

Being “customer-centric” has been the center of gravity when creating experiences, but it still treats customers as “buyers,” in the position of receiving. As we move into the future, this relationship will be disrupted, and we will see customers as active stakeholders in deciding what type of experiences are created for them.  

Creating better experiences requires data, but customers are increasingly conscious of their privacy and the power of data ownership. Research9 shows that although Asian customers are more willing to share data in exchange for better service, 90% of them are concerned about data privacy and 84% of them desire more control over how their information is used.  

Leading companies should see this more as an opportunity than a challenge. Financial service brands should look at customers as empowered individuals, transform data collection into a “value exchange”, enhance data transparency with a sense of “co-ownership” and develop solutions and experiences through customer “co-creation.” 

9. From ”Boundaries” to ”Boundless” 

In the future world of Web 3.0, traditional boundaries will be blurred – online versus offline, virtual versus physical, consumers versus owners, etc. This boundless space will change how financial service companies organize and deliver value to customers throughout the lifecycle.  

The entire model of “financial services” might change in the context of this – the role of a company could transform from a “service provider” or a “transaction middleman”, to an ecosystem or a community that enables peer-to-peer connections and better decisions among employees, partners, and customers.   

The fast disruptions of fintech will never stop. Financial service companies should be open and embrace the changes to experiment with new ways of delivering value in the future, starting from small use cases.  

Data source:  

  1. Harvard business review, Taking the Financial Services Customer Experience to the Next Level
  2. Salesforce, Trends in the financial service industry
  3. Bain, How to achieve true customer-led growth and close the delivery gap
  4. Genesys, The era of 4.0 experience in Asia financial service industry
  5. Mckinsey, Future of Asia financial services
  6. Capgemini, The customer engagement imperative for financial services
  7. South China news portal, HSBC leverages smart analytics to develop new tools that enhance the personalized customer experience
  8. Genesys, the state of customer experience in financial services
  9. Warc, APAC consumers increasingly concerned about data privacy

FINAL THOUGHTS

With advancement in customers, technology and society, experience will become a critical driver of sustainable and transformational growth in the future. Financial services companies should take actions early and carefully assess which stage they are currently at, what levers they could invest in building towards the next stage and start with smaller test and learn today to lead the future.  

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Naming in Today’s White-Hot M&A Environment  

Learn the five best practices to get M&A naming right.

Despite the uncertainty of the global pandemic and recessionary outlook, M&A activity continues to surge across all industries, with a record $2.9 trillion in transactions in 2021, and 2022 is expected to be even bigger. While not every deal requires naming, the large transformation deals do. In these cases, a new name is the most visible, symbolic and longest-lasting M&A decision. It’s an opportunity to start fresh and signal unity to employees and customers alike. But shockingly, many companies still get it wrong. 

Getting to a great name in these fast-paced environments requires significant care and attention. What sometimes starts out as “let’s brainstorm and come up with something cool,” can often turn into a highly emotional, intensely subjective process that can create leadership friction and decision-making paralysis, ultimately delaying a brand’s launch.  

Following are five best practices to get M&A naming right.

1. M&A naming is not a democracy. 

Since naming a new enterprise is something many executives experience just once in their careers, many leaders don’t want to make the decision alone. So, they invite stakeholders from every angle to weigh in. However, there will likely already be numerous decision-making voices at the table—including multiple CEOs, private equity partners, other investors or board members. In these multi-stakeholder environments, we believe the decision-making body should be kept to the right balance of as few executives as possible, but as many as necessary, with focused participation early in the process (yes, even CEOs).  

Despite the perception that naming is a fun, creative exercise, the reality is that it’s a high-stakes, emotional decision that will carry your organization into the next several years, and maybe even the next several decades. With this in mind, getting lean on the decision-making team, and ensuring they’re active participants from the very beginning, will lead to a more successful outcome.   

We also recommend that clients resist the temptation to test name candidates with employees—while inclusion is a noble goal, this step gives employees a voice in the decision, rather than treating them as an audience we want to inspire with our ultimate reveal.  

2. The name you want is probably taken, but there’s a better name out there that isn’t. 

This one is a tough pill to swallow. But with most M&A deals being highly global, getting a name to clear across many trademark classes and geographies requires deep, divergent thinking. Yes, ‘Mosaic’ is taken. No, you cannot have the name ‘Fountain’. ‘Iris’ does indeed tell an intuitive metaphorical story, but four other organizations already beat you to it!  

While we wish it was easy enough to just call the U.S. Patent and Trademark Office and ask for an exception, unfortunately, it’s not. But by exhausting creative exploration, you can uncover an adjacent or new idea that tells an even richer story. Sometimes that means you’ll get lucky with a simple, metaphorical real word that isn’t yet taken. Sometimes it’s about coining a gettable, “sticky” new word, and sometimes it takes getting comfortable with an idea that is more abstract—and more ownable. With an estimated 213 million companies in the world, naming isn’t just a creative game. It’s also a numbers game. And arriving at an answer that is inspired, strategic and viable requires diligence, objectivity and a willingness to push past your comfort zone. 

3. Every name has varying degrees of legal risk—but not every risk is a deal breaker.  

To add on to point #2, almost any name you consider will have some degree of risk associated. No name is ever given an ‘all clear,’ so getting legal involved early on can help you understand what degree of risk your organization is willing to take on, which will then influence the types of names explored. What’s more, different legal teams may employ different legal strategies to pursue or secure a name, from acquiring a mark to petitioning for co-usage with another party.  

When Google launched Alphabet, even an enterprise of their size and influence couldn’t clear the pure URL of alphabet.com or secure the pure ‘alphabet’ social handles, which were currently being used by other organizations with the same name, including a division of BMW. But Google believed Alphabet was the name that best represented the story they wanted to tell, so they went to market understanding there were legal risks associated with that name and launched with another URL—the very clever www.abc.xyz. All to say, legal baggage associated with your favorite names can be investigated and often worked around, as long as you have legal embedded in your process from the very beginning. 

4. Fast-paced M&A deadlines can work in favor of a successful naming outcome.  

With all the critical decision points and process gates leading to deal closings and ultimately a new brand launch, getting a name identified, cleared, designed and launched can feel like a daunting process. At Prophet, we believe sticking to an objective process and adhering to a thoughtful naming brief as the source of truth enables teams to use time pressure in a way that works in their favor. Having less time can actually be the forcing function teams need to evaluate ideas objectively, leave emotion and biases at the door and make quick, but meaningful decisions. When there is no time to second guess or decide by consensus, teams often trust their guts and arrive at impactful answers. 

5. And finally, remember that a name is a powerful asset—but not the only asset. 

Although we always say your name is your most visible asset, it is not your only asset. This is especially important in M&A environments, where there are multiple parties coming together under a shared value proposition that is oftentimes broader and more aspirational than their previous strategies or stories. While the name can certainly signal part of this new experience, it cannot tell the complete story on its own. We help clients see their name in the context of other strategic levers, like the promise they make to their customers, their visual language, or the experiences they aim to create.  


FINAL THOUGHTS

Naming in M&A environments poses its own challenges but launching a new brand at this scale and on the global stage—and doing so with a name you feel confident in and inspired by—is a deeply rewarding experience.  

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Enabling Effective Collaboration in SEA: The Way Forward 

Our research shows companies in SEA value collaboration but lag in execution. Learn how to close the gap. 

More than ever, collaboration is top of mind as companies ease out of the pandemic and build towards a new normal. The past few years showed us the challenges of collaborating amid changing COVID-19 restrictions and hybrid setups. However, they have also shown us the transformative potential that can be unlocked via technology, agility and a human-centered approach.  

In Southeast Asia in particular, effective collaboration is paramount to unite a diverse set of countries and strive towards a common goal. But this is not without its challenges. The region continues to struggle with heightened competition for talent, fluctuating COVID-19 policies and different development stages of hybrid work in an ever-competitive market landscape. Moreover, collaboration in SEA can be particularly challenging due to a number of characteristics unique to the region: varying cultural and language backgrounds of employees, different levels of economic development across the region, nascent stages of digital transformation and – for international corporations – a wider cultural difference between HQ and regional offices.  

Despite, or perhaps because of these challenges, our 2022 global research report, “Catalysts: The Collaborative Advantage”, shows that SEA companies value collaboration more than other regions (52% versus 44% globally).  

Diagram 1: Value of Cross-Organizational Collaboration 

However, only 28% of SEA respondents feel they are very effective at collaboration across their organization.  

Diagram 2: Effectiveness of Cross-Organizational Collaboration 

How can the region work to close the gap and reap the benefits of strong, cross-organization collaboration?  

The Collaboration Flywheel 

A key output of this year’s “Catalysts” report, Prophet’s annual global culture research study, is the Collaboration Flywheel, a model that reveals a path for leaders and organizations to prioritize and accelerate the efforts to build their collaborative muscle.  

The metaphor of a flywheel helps capture the inherent complexity of the adaptive system that is organizational culture. A flywheel works by reinforcing positive behaviors and outcomes while minimizing negative feedback loops, thus building and maintaining momentum over time. Most importantly, each specific action we’ve identified in the Collaboration Flywheel model helps deliver better, more impactful outcomes more quickly. 

Using this framework, we can understand how SEA can leverage its strengths and unique regional characteristics to drive greater organizational effectiveness.  

Diagram 3: The Collaboration Flywheel 

1. Coordination 

The first phase in the Collaboration Flywheel is Coordination. This is where many organizations begin their development journey by empowering groups to work horizontally rather than just in their vertical silos. Coordination centers on connecting an employee’s effort to the larger picture – the organization’s purpose – and modeling “what good looks like.”  

In our research, when compared to respondents in other regions, SEA respondents were more likely to emphasize the importance of connecting individual work to the organization’s purpose. In SEA, 75% of respondents believe it is important to be able to connect their work to the company’s business strategy, however, only 36% think they are able to effectively contribute to the organization’s purpose.  

Diagram 4: Value versus effectiveness When Connecting Employee Work to Business Strategy 

While many factors can inhibit an individual’s ability to contribute to the organization’s purpose, we see the three biggest factors in the region as top-down management styles, lack of understanding of “what good looks like” and early stages of digitalization. To overcome these hurdles, companies can enable cross-organization coordination by empowering decision-making at lower levels of the organization, showcasing best practices and pushing the digital transformation agenda forward.  

In 2017, MB Bank, one of the largest financial services groups in Vietnam, set up a new digital bank as an independent business unit, separate from its legacy bank. This radical approach to digital transformation helped MB Bank’s speed to market, but it also made coordination between the two BUs challenging. Employees knew the bank’s digital transformation goal, but those in the legacy bank couldn’t always contribute to it.  

MB Bank recognized this disconnect and saw the impact it had on employee coordination and how that translated into the customer experience. By leveraging digital transformation to instill agility and a more nimble way of working across the organization, MB Bank was able to transform its legacy bank, driving the efficiency of its operating model and increasing cross-organization coordination. To further create a culture of collaboration, the company focused on shifting the mindset of its people, encouraging an entrepreneurial and agile approach that embraces risks and a fail-fast new culture. This has propelled MB Bank today to become the fastest growing and most digital bank in Vietnam.  

2. Cooperation 

The next phase is Cooperation, which builds on coordination by adding trust and shared ways of working. It is characterized by clarity of objectives, capability building and incentive alignment. 

Relative to other regions, SEA respondents place more emphasis on aligned incentives as necessary means for collaboration. In our research, 78% believe incentive alignment is important to collaboration effectiveness, and a quarter believe incentive misalignment is also one of the biggest barriers to achieving this goal. 

Diagram 5: Value versus. Effectiveness When Aligning Incentives That Encourage Cross-Organizational Collaboration 

Keeping in mind SEA’s highly diverse workforce, the definition of a good incentive can vary widely.  

For example, companies in more developed countries such as Singapore, tend to consider soft incentives (benefits, training, recognition, etc.). However, companies in developing countries such as Vietnam, often prioritize hard monetary incentives. Beyond cultural differences, unrelated parts of the organization are often incentivized by siloed outcomes and metrics of success, making cooperation difficult. To solve this, companies can enable cross-organization cooperation by aligning incentives with relevant business outcomes that build towards a common goal, while taking cultural nuances into account. 

In 2020, HSBC merged its retail banking, wealth management and global private banking into a new global wealth and personal banking unit. This change in the organizational structure allowed for greater operational efficiency, reducing redundancies and combining related capabilities, talent and infrastructure resources. By breaking down silos and creating a shared mindset around collectively achieving goals, HSBC was able to reduce cooperation barriers to drive more effective client outcomes. 

3. Collaboration 

As cooperation builds interdependence and synergy between formerly independent groups, it creates the opportunity to pilot and embed new ways of working. In the Collaboration stage, leaders reward progress – not just outcomes – and there is a culture of evaluating both process and priorities within the context of the organization’s purpose. 

When compared to other regions, SEA is better at both recognizing and rewarding cross-organization progress. Almost half (41%) of SEA respondents believe their organization is good at recognizing and rewarding progress. However, to enable effective cross-organizational collaboration, organizations need to both recognize progress and be open to constructively challenging the ways things are done.  

Diagram 6: Value versus. Effectiveness When Recognizing and Rewarding Cross-Organizational Progress, Not Just Outcomes 

Many of the companies in the region tend to be more traditional in their approach to workplace organization and culture, emphasizing their top and bottom line over individual wellbeing. This is especially true for small and medium enterprises, which make up 97% of all businesses in the region. This conventional mindset often inhibits individuals from innovating new, more effective ways of working.  

To open the door for innovation, employers can empower employees to think critically about how they can better contribute to the organization’s purpose and be innovative in their ways of working. By allowing a more bottoms-up approach to organizational culture, employers will not only see more effective outcomes in the market but will also make their workplace more attractive to employees. This can be achieved through test-and-learn environments where employees can propose new ways of working and implement integrated planning processes where functions can share wins, risks and priorities. And if the organization is in the midst of a transformation, this is where setting up a Transformation Management Office (TMO) to connect different parts of the organization around a unified set of goals can take place.  

Singapore’s Government Technology Agency (GovTech) has adopted a flat, tech-like organizational structure that gives semi-autonomy to its sub-groups. This enables the agency to have not only speed to market, but also high levels of collaboration across the groups. In addition, when recruiting, GovTech specifically looks for a sense of learning agility in candidates, ensuring its employees are eager to adapt, pivot and stay ahead of the trends. This internal culture of collaboration helps GovTech stay competitive with other tech startups and incumbents that prospective employees might be considering. The results are astoundingly impactful: In 2021, 99% of citizens surveyed expressed satisfaction with the overall quality of Singapore’s government digital services.  

At Prophet, we believe that people are at the core of any organization. And people working together collaboratively is what drives change, delivers results and sets organizations apart. SEA faces unique challenges: from its uneven regional economic development to its early stages of digital transformation to the diversity in its workforce. However, these present an even more pressing need for organizations in the region to build towards a culture of collaboration. By using Prophet’s Collaboration Flywheel, organizations can work towards:  

  • Coordination: Illustrate the linkage between an employee’s individual effort and the organization’s purpose. Guide individuals by showcasing “what good looks like” and giving decision-making authority to lower levels, while leveraging digital transformation as an enabler.
  • Cooperation: Align incentives across the organization, balancing differing definitions of what a “good” incentive is. Take these cultural differences into account to create incentives as well as a shared mindset that collectively achieves unified goals.
  • Collaboration: Focus on the process, not just outcomes to make room for more agile thinking which allows synergies and interdependences to form. Empower employees through a bottoms-up, test-and-learn approach that encourages them to challenge the status quo and implement new, fresh ways of thinking. 

FINAL THOUGHTS

Prophet’s 2022 global research report, “Catalysts: The Collaborative Advantage,” aims to help companies better understand how effective collaboration works and identify opportunities for growth. To learn more about how insights from the report can apply to your organization and your region, contact our team today. 

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Powering Positive Impact: A Recap of Prophet Impact Day 2022 

Reflecting on our firm’s annual volunteer day and our goal to drive positive impact in our societies. 

On Friday, July 15, over 435 Prophet employees around the globe gave back to their local communities as part of Prophet Impact Day—an annual event where our entire firm pauses and focuses on elevating the work of organizations that are making a positive impact in our societies. 

The last few years have presented significant societal, economic and environmental challenges and, of course, a global pandemic. While we have reinvented what Prophet Impact Day (previously known as P4NP) means for us as individuals and as a firm, we remain committed to taking on these challenges head-on and doing our part to amplify the work of nonprofit organizations where we live and work. In broadening the scope of this volunteer day, we have a renewed focus on addressing the causes that our employees are most passionate about: sustainability, equality and social mobility. 

This year, on our 8th annual Prophet Impact Day, we partnered with over 25 organizations and dedicated over 1400 hours to create an impact in our communities.  

Propheteers engaged in a wide array of activities this year supporting a diverse range of causes: 

  • Sorting donations and preparing meals to help underserved communities in Atlanta, Richmond, New York, Chicago and Hong Kong  
  • Remodeling temporary shelters for Ukrainian refugees arriving in Berlin
  • Getting our hands dirty in efforts to help community farms and keep parks and beaches clean in London, Singapore, Zurich and San Francisco 
  • Empowering the next generation of young leaders in Austin and Shanghai  
  • Using our business expertise to consult local nonprofits–including Florham Park Educational Fund, Charlotte Rescue Mission, Alaina’s Voice and Austin Pets Alive– to help them grow and achieve their missions.  

Whether our employees were in-person, virtual, working in groups or independently, Propheteers across the firm had flexible opportunities to support the causes they’re passionate about. Prophet Impact Day also provided a chance for our teams to connect with colleagues outside of the regular day-to-day, building new relationships and nurturing old ones.  

“It was so energizing to see the photos and hear a bit about the experiences that were shared around the globe. It’s this type of leadership, sense of understanding, empathy and excellence in our work that makes me extremely proud of our firm and what we can accomplish together.”

Michael Dunn

FINAL THOUGHTS

With our ever-growing headcount, we continue to find ways to build participation in our offices and give our teams the opportunity to make their own impact. With the world more in need than ever before, we continue to look for more ways to make a difference in our local communities through our Prophet Impact initiatives including volunteer time off, our pro-bono program and beyond. Together with our partners, we strive to build a healthier, more compassionate, more just world. 

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Three Ways Brands Drive Value in Turbulent Times 

Companies often want to cut back brand marketing during recessions. It’s a mistake. 

Buckle up, brand marketers. While a recession is by no means certain, it’s clear that the markets are unsettled. As consumers cut back on their spending, layoffs start and revenues slow, jittery leadership will begin to look for ways to slash spending. Brand marketing budgets are often high on the list. 

However, that’s a mistake. A well-built portfolio of brands is critical in a recession–or even just a downturn. Healthy brands generate more trust, they’re more in demand and have more resilience and strong brands retain customers, even in the face of lower-priced alternatives. In fact, in past downturns, companies that held marketing budgets steady or increased them bounced back best, reports the Harvard Business Review

For example, Reckitt Benckiser increased marketing spending by 25% during the 2008 financial crisis, as rivals trimmed their budgets. With a larger share of voice, the UK-based consumer goods company saw revenues gain 8%, and profits rose 14%. Most of its competitors posted profit declines of 10% or more. 

The 2021 Prophet Brand Relevance Index® (BRI), which was fielded in late 2020 during the pandemic and a period of high market uncertainty, proved this point. . As obvious as it seems in hindsight, consumers flock to names they trust in times of instability. They’re less inclined to take risks, and trust is significant to them. 

In the 2021 BRI, the average relevance score of the top brands jumped 5%. In other words, in a time of uncertainty, these leading brands became more relevant than they had been in times of relative calm.  

Strong brands allow companies to justify and maintain pricing power because consumers understand the value equation. Products from companies like Apple, KitchenAid, Dyson, Bose and USAA on the whole cost more than competitors. But because consumers appreciate their value, they are willing to pay more. 

That advantage holds for B2B companies as well. When selling through intermediaries, B2B firms that deliver greater value can retain a negotiation advantage with channel partners. Weak brands have less leverage and are easier to squeeze. 

An economic downturn may mean fewer people are spending on a given category, reducing the size of the pie. But strong brands get to take a bigger bite. Here are three ways to protect and build brand value, even in stormy economic periods: 

1. Strengthen the Brand’s Foundation 

Strong brands, often with a years-long history of consistent investment, already have a robust foundation. Brand equity stems from clarity of purpose. These brands know what they promise and how to deliver on that promise in the market. That clarity of purpose ensures an efficient spending of dollars. 

Even companies that believe they’ve adequately defined their brand’s purpose need to take a closer look, finding new ways to sharpen, deepen and extend that focus. Purpose–the reason a brand exists in the world– should be clear internally. And it should shine through to customers in every offer, channel and message. 

This is also a great opportunity to lean into the stakeholder networks. With a well-defined purpose, it’s easier to ask key stakeholders–customers, employees, investors, influencers and community members– to step in and act as brand ambassadors. They can amplify a brand’s voice and purpose. Because trust matters so much more right now, word-of-mouth endorsements carry even more resonance. 

2. Make Sure the Story of Value is Clear  

While this is most evident in B2B marketing, it’s just as important when dealing with consumers. People are worried about money, especially with inflation and interest rates rising. There’s an increased focus on the value equation of their purchases. They want to understand all the trade-offs they make between price and quality.  

Customers have a lower tolerance for confusion. This is a moment for marketers to be exquisitely clear about the value in each part of their portfolio. It’s too much to expect people to confront a number of brands and sub-brands and understand why they are priced or marketed differently. Spell out precisely what they get by trading up or down within the portfolio.  

3. Stay Nimble, Rebalancing Brand and Demand Investments 

Agility is important. Marketers should be having earnest internal debates about how and whether to rebalance spending between brand and demand marketing.  

Brand marketers will–and should–argue it’s an important time to continue building trust and equity. Demand marketers, as well as financial leaders watching revenue trends most closely, will want to focus more on driving immediate sales. Our latest research, Brand and Demand Marketing: A Love Story shows that brand and demand marketers must find ways to work together – and those that do are able to deliver better outcomes that are tied to the overall business goals. Everyone wants to ensure they are the brand chosen at the end of people’s purchase decision. 

We’re betting that a year from now, CMOs will have plenty to say about how they’ve threaded this needle and which investments yielded the best results. But right now, brand and demand need to work in tandem, more closely than they have in the past. 

Strong brands can be confident that they’ll continue to lead the way, delivering the innovations that matter most to consumers. 


FINAL THOUGHTS

As economic conditions continue to soften, brand marketers should brace themselves to defend budgets–even if the U.S. enters a recession. And they should take steps to ensure those brand investments. By shoring up brand purpose, clarifying each offer’s value, tapping stakeholders’ networks and carefully considering the balance of brand and demand marketing, they can keep brands strong through every downturn and in the next cycle of recovery.  

Get in touch with our team today to help make the case to your board and executive leadership team on the value of investing in your brand during uncertain market conditions.  

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How Financial Services Brands Can Position Themselves for the Next Growth Cycle 

When charting your next growth move, here are three ways smart financial services brands are already preparing for what comes next.  

So far, this economic cycle is so loaded with 1970s throwbacks like soaring gasoline prices, inflation, and interest rates that we half expect to see a resurgence of the Burt Reynolds mustache and tie-dye ponchos. Whether we are at the beginning of the next Great Recession or just a minor downturn, history tells us that when brands scale back investments in growth, they typically end up with regrets. This is because when the next growth cycle begins, they tend to trail the field as competitors capture significant opportunities.  

For financial services companies, the current times seem particularly dire. CMOs in this industry are increasingly less optimistic, with 44% of those in banking, insurance and finance saying they are less upbeat about the U.S. economy compared to 39% of all CMOs. No one is happy about saying goodbye to the sizzling stock market, red-hot housing sales or consumer spending swagger. 

Scary? Maybe. Time to invest in growth? History resoundingly says yes.  

Research shows that companies who double down on defensive plays tend to limp out of recessions. But those that fare best invest in new markets, products and services. A “Harvard Business Review” analysis of companies in the Great Recession of 2008 to 2010 found that 17% of the 4,700 public companies studied fared quite poorly, either becoming bankrupt, private or acquired.  

Though the majority muddled through, 9% emerged from the downturn as elite success stories, outperforming competitors by at least 10% in sales and profits growth. Why? In simple terms, they stayed focused and invested in areas of relatively lower opportunity costs.

“You cannot overtake 15 cars in sunny weather… but you can when it’s raining.”

– Ayrton Senna, Formula One Champion 

This is a lesson in how firms build resiliency in uncertain times. They evolve and make intelligent choices, ultimately emerging stronger than competitors.  

So what should you do now? We believe those financial services brands that lean into these three areas are more likely to tap into uncommon growth once the economic engines reverse course. 

Below is a summary of each of the three areas. In future articles, we will dive deeper into each to provide actionable recommendations to set your organization up for uncommon growth.  

Align Everything You Do to Your Customer’s Values

“Three classes of factors affect what an organization can and cannot do: its resources, its processes and its values.”

― Clayton M. Christensen, “The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail”

The importance of a company’s purpose has changed dramatically in the last several years. It is no longer enough to establish purpose-driven brand messaging. Companies need to align everything they do to their customer’s values. The growing demands for progress on racial justice, climate concern and social issues no longer come just from consumers. Investors, employees and other stakeholders expect purpose-led thinking too. 

But how do you make your purpose part of your organization’s DNA? Part of the operating model that is core to how stakeholders hear, see and feel the business? Prophet’s Human-Centered Transformation Model™ serves as a framework for effectively aligning the way your purpose and values are integrated throughout your organization.  

Customers and stakeholders want to see corporate purpose defined in a more meaningful sense. They expect products, services and experiences that align with what matters most. It has become a core component of a brand’s reputation and relevance.  

Example Winning Strategy:  Define your purpose-driven operating model

Financial services brands that are leaning into driving purpose throughout the organization are positioning for the future. Some firms are beginning to build purpose-driven operating models, incorporating purpose into project charters and establishing “Purpose Teams” into the project management structure.  

ESG commitments continue to be a focus of a brand’s purpose, promise and principles. Aspiration, an online financial services company and Certified B Corp, is a favorite example. Its “Leave your bank, save the planet” positioning allows customers to decide how much they will pay for services. It has even built a mobile tool to help customers assess their overall impact on climate change based on where they shop and how they invest. 

While ESG was once about compliance and risk mitigation, we believe it is now a requirement for unlocking uncommon growth. And the companies having the greatest success with their ESG strategies are the ones who have created authentic changes in the culture of their full stakeholder ecosystem.  

Financial services firms can maximize their impact by choosing ESG-driven growth strategies that are specific, ownable, applicable and measurable. 

Invest in Humans Over Technology  

Today, companies have more technology at their disposal than they could ever use in a coherent customer journey. It takes a combination of sensibilities and methods to create value. Humans–not digital tools– are better at building these interactions.  

Humans–the roster of employees and all stakeholders–matter more than equipment. That being said, in no way should we diminish the importance of the continued digital transformation across the industry. At its recent Investor Day, for example, JP Morgan revealed it would spend a staggering $14.1 billion on technology this year. However, the firms that will win in the future are those that can also build an organizational focus on the humans using the technology.  

Example Winning Strategy: Build a compelling employee value proposition – develop an EVP that:

1. Articulates what makes your company an awesome place to work and to grow a career

2. Improves how your company wins in today’s talent marketplace

3. Develops an enhanced foundation to support future talent needs and can evolve in line with future business and brand strategy

Leading companies are using technology to focus on pattern recognition, then inviting humans to understand it and put the relevant insights in context. Technology is great. Human capital is greater. 

These companies are also actively working to decentralize, freeing human capital by shaking up organizational structures. Decentralized companies emerge from recessions with higher levels of innovation and more resilience, adapting better to changing conditions. 

Prophet’s research has shown that this human-centered approach leads to greater levels of innovation, especially in the financial services industry. The key to it all? Finding ways to heighten avenues of cross-organizational collaboration

Define Your Brand’s Role in Embedded Finance Era 

Customers need financial services, but they do not need the current legacy construct of delivering those services. Whether you use Affirm to buy a mattress, the Starbucks app to buy a latte or a Lyft for your transportation needs, embedded finance is all around us and presents an opportunity for financial services brands to extend into other industries, such as healthcare and retail. According to recent research, the U.S. embedded finance industry is expected to grow at a CAGR of 23.5% from 2022 through 2029, reaching $212 billion by 2029.  

Long viewed as a transactional element of the customer journey, we are now seeing an expansion of use cases. Take DriveWealth as an example. It is working with healthcare companies to offer comprehensive investment advice as part of healthcare savings accounts. And with the emergence of companies such as Column, billed as the “only nationally chartered bank built to enable developers and builders to create new financial products,” we are poised to see an exponential increase in use cases that cut across all industries.  

What does each of these companies have in common? They have defined the next market battleground using a combination of platform and design thinking, focusing on the value of activating ecosystems. So, it is easy to understand why incumbent banks, insurers and investment managers feel threatened. However, they should not.  

As the industry moves from linear finance to embedded finance, understanding your organization’s role in the new value chain created by this disruption is the first step.  

Will you play the platform-creator role? How should you think about the allocation jobs-to-be-done? How will you control the experience customers have with your brand? 

The faster financial services leaders realize the value of delivering an omnipresent financial services experience in people’s daily lives, the faster that value can be achieved for both the customer and the enterprise. The concept of Time to Value (TTV) will play a critical role in the embedded finance era. 

By positioning an organization’s brand and core capabilities around its aspirational role in the evolving value chain, companies can embrace the embedded finance era.  

If you are a senior financial services leader and have not yet embraced the implications of the pivot from linear finance to the embedded finance era, you are putting your organization at risk of lagging behind in the next growth curve.  


FINAL THOUGHTS

Just as “buying the dip” can produce above average returns in your stock portfolio, financial services brands can prepare themselves for turbulent markets by committing to an offensive strategy through this current economic downturn. Finding new and uncommon ways to build embedded finance era strategies, aligning more closely with customers’ values and investing in human-centered transformation – even as investments in technology continue – will help accelerate growth as we move into the next economic cycle. 

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A Consultant’s Guide to Summer Reading 2022

Summer is here, let the reading begin. 

Summer is in full swing, and everyone is excited to bathe in the summer sun, relax in the heat with a refreshing drink and, of course, finally read the book(s) that have been collecting dust on the shelf. Every year, we ask Propheteers to create a book guide of their favorite reads for their clients, peers and those who are consulting curious! So, if you’re not on #BookTok or are unsure which tales are worth your time, take a dive into our compilation. You may find your next favorite here. 

Our Consultant-Curated Summer Reading List:

The romance book that goes beyond the cliché

“Olga Dies Dreaming”

by Xóchitl González

This tells the tale of a status-driven wedding planner grappling with her social ambitions, absent mother and Puerto Rican roots, all in the wake of Hurricane Maria. Set against the backdrop of New York City in the months surrounding the most devastating hurricane in Puerto Rico’s history, “Olga Dies Dreaming” is a story that examines political corruption, familial strife and the very notion of the American dream–all while asking what it really means to weather a storm. 

The mystery book you will not be able to put down

“Piranesi”

by Susanna Clarke

Piranesi’s house is no ordinary building. It has infinite rooms, endless corridors and walls lined with thousands of statues. There is only one other person in the house – a man called The Other, who visits Piranesi twice a week and asks for help with research into a great and secret knowledge. But as Piranesi explores, evidence emerges of another person, and a terrible truth begins to unravel, revealing a world beyond the one Piranesi has always known. 

The fantasy book that will enchant you

“The Midnight Library”

by Matt Haig

This novel tells the story of a library between life and death. It is a library with boundless shelves and books that provides another chance to live a different life. In Matt Haig’s enchanting novel, “The Midnight Library”, Nora Seed is confronted with the possibility of changing her life for a new one. As she travels through the Midnight Library to find solutions, she must decide what is truly fulfilling in life, and what makes it worth living in the first place. 

The coming-of-age novel that will evoke your own self-discovery

“The Girl with the Louding Voice”

by Abi Daré

Based in a rural Nigerian village, “The Girl with the Louding Voice” is an unforgettable, story of a teenage girl who longs to get an education so that she can find her “louding voice”. This moving novel is a simultaneously heartbreaking and triumphant tale about the power of fighting for your dreams. 

The sci-fi short story collection that takes you to a dystopian world

“Bloodchild and Other Stories”

by Octavia E. Butler

Like all of Octavia Butler’s best writing, these works are parables of the contemporary world. In her short stories, Butler proves constant in her vigil–an unblinking pessimist hoping to be proven wrong, and one of contemporary literature’s strongest voices.

The poetry collection that will tug your heartstrings

“Love and Other Poems”

by Alex Dimitrov

Author Dimitrov believes that of humankind’s greatest achievements, the best invention is love. As he navigates darkness, fear, loneliness and guilt, Dimitrov doesn’t resist joy even in despair. This poetry collection depicts who we are as people and how we view even the terrible and fraught through the eyes of a curious individual. 

The memoir that has gripped our hearts

“Crying in H Mart”

by Michelle Zauner

This unflinching, powerful memoir tells the life story of Michelle Zauner. Growing up Korean American, losing her mother and forging her own identity hasn’t made Zauner’s journey an easy one. Zauner’s experiences radiantly shine through her vivacious and honest writing. Rich with intimate anecdotes that will resonate widely and complete with family photos, “Crying in H Mart” is a book to cherish, share, and reread. 

The science book that Prophet’s healthcare practice couldn’t stop talking about

“The Premonition: A Pandemic Story”

by Michael Lewis

This nonfiction thriller depicts the difficulties medical leaders faced in response to the COVID-19 outbreak. Michael Lewis is not shy about calling these people heroes for following the data instead of directives. The characters you will meet within these pages are as fascinating as they are unexpected.  

The true-crime book of the century

“Empire of Pain: The Secret History of the Sackler Dynasty”

by Patrick Radden Keefe

Sackler name adorns the walls of many storied institutions: Harvard, the Metropolitan Museum of Art, Oxford, the Louvre. Though the family is one of the richest in the world, the source of the family fortune was vague. That is until it emerged that the Sacklers were responsible for making and marketing OxyContin, a blockbuster painkiller that was a catalyst for the opioid crisis. “Empire of Pain” details the Sackler family’s heinous crimes in this well-documented and compelling nonfiction book. 

The Pride book that not only tells you but shows you its history

“Queer X Design: 50 Years of Signs, Symbols, Banners, Logos, and Graphic Art of LGBTQ”

by Andy Campbell

Featured in Prophet’s Pride Month DEI Dialogues, this book is the first-ever illustrated history of the iconic designs, symbols and graphic art representing more than five decades of LGBTQ pride and activism, ranging from the years before the Stonewall uprising to the new millennium. Queer X Design celebrates the inventive and subversive designs that have powered the resilient and ever-evolving LGBTQ movement. 

The marketing book that bewitched our consultants

“Alchemy: The Dark Art and Curious Science of Creating Magic in Brands, Business, and Life”

by Rory Sutherland

How does magic happen? This revolutionary book by Ogilvy advertising legend Rory Sutherland decodes human behavior based on 30 years of fieldwork inside the largest human behavior experiment in history. Rich with deep psychological insight and entertaining storytelling, this book will enchant you with more marketing knowledge than you have known.

The essay-turned-book about how humanity has shaped today’s world

“Funny Weather: Art in an Emergency”

by John Green

The Anthropocene is the current geological age, in which human activity has profoundly shaped the planet and its biodiversity. Adapted from his ground-breaking, critically acclaimed podcast, John Green’s symphony of essays review different facets of the human-centered planet– from the QWERTY keyboard and Halley’s Comet to Penguins of Madagascar– on a five-star scale. Green’s gift for storytelling shines throughout this artfully curated collection about the shared human experience.


FINAL THOUGHTS

With so many compelling stories and narratives out there, it can be hard to determine which content to consume. Luckily, our Prophet consultants have good taste and love sharing their favorites. From fiction to nonfiction, we have you covered for the season. Which books would you add to this list this year?

If you haven’t already, check out our past guides from the previous years here.

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Building Relentless Resiliency in Times of Uncertainty 

Five imperatives for thriving during a period of economic turbulence.

“Never let a good crisis go to waste” may be old advice, but it feels timelier than ever. While businesses are still struggling to distill the ongoing lessons of the pandemic, they now see inflation, interest rate hikes and an ongoing war pushing the economy closer to recession. If that wasn’t enough, supply chain issues continue to disrupt and consumer confidence is fading. 

Companies are also challenged as they try to figure out if we are in the great resignation or the great retirement, and what that all might mean for the great hybrid experiment.  

A new norm has emerged: The only true business constant is continuous business disruption. 

Predictably, many businesses are already fearful, cutting budgets, freezing new hires and even laying off staff.  We are seeing this in our clients. Governments are getting involved in companies’ marketing spend. And chief sustainability officers wonder how best to pay for the commitments they’ve made over the past two years. 

All these issues are real and complex, and in some ways, it’s good to be on high alert. But businesses have a choice in how they respond, as they did in the economic crises of 2001, 2008 or 2020.   

Each downturn has produced new economies that did not exist before, from e-commerce to the sharing economy to the experience economy to the world of subscriptions and crypto. There’s a long list of companies that have been created by these downturns including Netflix, Uber, Airbnb, AbbVie, Spotify, Instagram, Bitcoin and Ethereum. Others, such as Samsung, GM, Microsoft, Amazon, Google and Bank of America have been reimagined in ways that would be hard “to imagine” before these downturns. 

So, instead of talking about crises, cutbacks and retrenching, we are choosing to use words like resiliency, durability, agility and radical innovation, as we guide clients through this latest challenge. We know growth can’t happen amidst panicky cost-cutting or short-sighted pivots. 

No one enjoys downturns. But we can see how our clients in the past have channeled anxiety into strength and resiliency. They evolve. They make intelligent choices and emerge stronger than the competition. This is a moment to leapfrog and discover ways to accelerate, creating an opportunity to differentiate companies from competitors and create net-new businesses and categories, customer experiences and offerings. 

To this end, here are five ways we are advising clients as they strive to build their own versions of relentless resiliency. 

Accelerate Purposeful Leadership 

In the last two years, purpose-driven companies have become the norm. COVID-19 triggered an unprecedented number of companies to go out, find their North Star and align to a higher-order purpose. These past few years have shown leaders that doing good in the world, doing right by employees and customers and making money can all work in concert. Now is not the time to throw all of that goodwill and equity away.    

Purpose-driven companies are forcing leaders to become more agile, transparent and even a little vulnerable. The radical communications door that opened during COVID-19 needs to stay that way. The entrepreneurial spirit that allowed companies to reinvent how they did business has to continue to thrive. The agile strategies that respond to a changing environment must become the norm.  And, importantly, with a strong purpose in place, they can make hard decisions through a values-based filter. Steps to take now: 

  1. Invest in purpose-driven growth moves. Remind teams that downturns always open white space opportunities for those that are looking “between the cracks.” Encourage teams to continuously search for the next big thing. What will be the crypto or sharing economy of 2023? How might it align with your purpose? How will it move you forward? And, importantly, how does it pay off your purpose? Assume your competition is doing the exact opposite. 
  2. Be ruthlessly transparent. Agility is important, but moving too fast can cause whiplash, confusing employees rather than inspiring them. A change in direction and purpose alignment can’t just be clear to leadership–it must be evident to all teams and employees, as well as customers, shareholders and other stakeholders.  Be vigilant, strong and consistent in your communication approach. 
  3. Accelerate brand, demand and innovation efforts. Discretionary spending is generally first to go, yet, we have seen in the last three recessions that companies that kept their foot on all of these pedals have come out stronger on the other side. On the innovation side, widen the acquisition aperture. Start-ups and small companies might currently be more open to acquisition discussion, and can immediately fill in offering and experience gaps at a lower price point. On the brand and demand side, it’s easy to fall into the false dichotomy that companies must tradeoff between brand or demand marketing. However, you need both. And there must be a real partnership between the two disciplines often most at odds—sales and marketing–to figure out the right mix today and tomorrow. 

Leverage Employees as Your Greatest Competitive Advantage  

There are many reasons the employee base is so fragile right now. The great resignation, the great retirement and many of the experiments coming out of COVID-19 are still in motion. Many companies will use recession nerves to back off employee engagement efforts. If they haven’t yet focused on their employee value proposition (EVP), they may think they can let it slide.  

This is a big mistake. Like many other companies, Prophet just went through a talent war like few others we have seen. There is no reason to think that will change on the other side of this downturn. 

The current economy is making employees increasingly uncertain about the company-employee contract, despite all the employee engagement skills businesses have built through COVID-19. The EVPs just re-launched at many companies will be thrown into disarray. Pragmatically, if personnel cuts need to be made, it must be done through a strategic lens, tying back to the company purpose. Steps to take now: 

  1. Choose programmatic and initiative cuts over personnel reduction. We are still in the early days. And just as the pandemic sparked supply chain issues and are still causing mayhem (just peek in a Target or Walmart warehouse), so too will the labor shortages many are experiencing on a daily basis. 
  2. Encourage cross-functional teams. New research from Prophet finds that 63% of companies with higher cross-functional collaboration skills say it increases employee satisfaction scores, and 54% say it boosts retention. People want to work with one another. 
  3. Poke at pain points. Hybrid workforces are in their infancy, and there is much to be done to make the experience more fulfilling. Is commuting grinding people down? Are they stressed by after-hours e-mail? Do they have Slack or Zoom fatigue, and are there other tech solutions that might help? 

Make Budget Decisions Through the Experience Lens, not Just Organizational Constructions and Functions 

As mentioned, it’s natural for companies to consider cuts across the organization– in each function and business unit. In tough times, this often feels “fair”. Instead, decisions should be made using the experience point of view: What allows for the best customer and employee experience? 

Companies should take this opportunity to understand what is required across the functions to create differentiated experiences for customers and employees. This may require more granular cuts. And in every company, there are pockets within the budget that will always be spent, often in procedural and programmatic ways. That money may well be redirected to experience investments. Paused programs can always be restarted. Steps to take now: 

  1. Create agility through experience pods. Many companies have already put smaller pods into place to boost agility. Put these newer teams to work differently, across functions and in ways that build customer or employee experiences. Create assignments that build connective tissue. 
  2. Enhance collaboration. Break down silos and optimize spending by developing a more collaborative working model. Our recent research shows that while 80% of leaders believe collaboration leads to better outcomes, only 28% of hybrid workplaces effectively support it. And only 50% of respondents believe their teams collaborate effectively, even when they’re all in the same room. What are new ways to rewire traditional methods of working including budgeting, resourcing and product development? 

Harness the Investments Made in Technology  

Digital thinking continues to be the lifeblood of business. It drives everything from manufacturing to delivery to remote work. And technology accounts for trillions in business spending, including ongoing investments that can’t be reduced. The problem is that in most companies, this tech exists in ponds and lakes, with little ability to pull it all together.  

And in many, that single view of a customer–the dashboard we’ve all dreamed of–still doesn’t exist.  

If possible, it’s a good time to pause or slow new tech investments, reevaluating digital priorities. Any spending that improves customer experience should move to the top of the list. Steps to take now: 

  1. Clarify customer journeys. Use the point of view of each customer segment to ensure existing technology adds value, eliminates friction and provides the right data for future decision-making. This includes mapping the tech to each existing critical process. Encourage teams to find greater optimization. 
  2. Reconsider the employee experience. The right digital tools increase employee productivity and satisfaction, enabling the kind of collaboration that drives growth. 

Knowledge of Customers, Competitors and the Market Is the Only Superpower 

Stop guessing. When no one knows what lies ahead (and no one does), it’s critical to understand how customers think, behave and buy in real-time. And it’s just as essential to know exactly what the competition is doing. Amid so many economic changes, the rules of many categories are being rewritten as people and businesses alter their spending patterns. 

What’s required is a set of processes and mechanisms to gather as many insights as possible. This needs to be combined with a mindset that accepts the insights readily, with the willingness to adapt accordingly. No one knows exactly what is going to happen six months from now, but we need the skillset to collect and discern as much about the changing environment as possible. Steps to take now: 

  1. Pulse the market. Invest in pulsing capabilities, then embed findings into practices and processes. This constantly feeds into new products, services, experiences and go-to-market approaches. 
  2. Use insights to prioritize new investments. These insights may tell you that you do not have what it takes to be successful in an ever-changing world. Don’t be afraid to test and learn as a result, shifting investments as needed. 
  3. Challenge team behavior. The hardest part of integrating insights into your business may be changing the behavior of team members to act on the insights. This kind of cultural shift isn’t easy, especially when people are frightened. While you may be cost-cutting, invest in the change required in your culture to drive agility in the organization. 

FINAL THOUGHTS

Amid economic turmoil and uncertainty, there are still plenty of reasons to be optimistic. Downturns may be unsettling, but they provide abundant opportunities too. Companies that can use these times to find new ways of working–collaborating, integrating and even reconstituting–will be well-positioned to prosper as they enter the next growth cycle.

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