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2020: A year of acceleration and collaboration

5 insights from COVID-19 to drive organizational and global change

We have yet to overcome the COVID-19 pandemic, but we have seen an extraordinary effort to collaborate across societies, industries, and organizations. So, in the spirit of the year's end, let us look back and reflect: What can we learn from the pandemic to help us tackle other global challenges, such as the climate crisis?

By Daniel Sunde-Hansen and Bastiaan Walenkamp, Deloitte Center for the Edge

 

What can we learn from COVID-19-related changes to approach other societal challenges?

 

It’s all about learning

By learning from disasters and using it to change our behavior, we create meaning from crisis. We firmly believe that companies with clear long-term perspectives and values are far more capable of overcoming challenges, including the COVID-19 pandemic. As the pandemic caused stocks to plummet in late February 2020, the market rewarded companies that were perceived as more socially responsible.¹ By drawing the right learnings from this pandemic, companies and societies can adapt more quickly to future crises. And by embedding constant learning at the heart of their strategies, they can create new value and better manage societal challenges such as climate and health.

The COVID-19 pandemic accelerated change in an unprecedented way. It caused friction in many ways throughout society. Many companies had to find new ways of doing business almost overnight². Companies have displayed an unexpected ability for rapid change, such as breweries switching from producing beer to hand sanitizers. We have seen these transitions within companies and in partnerships across industries. They have shown us what we can achieve in a short amount of time and on a global scale when we face up to a grand societal challenge.

From our perspective of transformation and innovation, we identified five significant learnings of COVID-19:

1. Urgency accelerates innovation

We saw a sudden burst of experiments by companies to stay in business, with some able to find completely new ways of operating. Three types of experiments were dominant:

  • New ways of working: Business as usual, but from home. Organizations had to facilitate working from home overnight. Even companies that had been struggling with the digitization of processes for years managed to offer remote working in a few days.
  • New methods of distribution and production: Companies that changed their business activities. For instance, restaurants transitioned to take-away. In addition, many US and European companies with production chains in China and APAC were forced to move onshore, with a surprisingly positive outcome in terms of quality and price.
  • New products and services: Companies that completely changed their output, such as vacuum-maker Dyson taking an order of 10,000 ventilators from the UK government³.

Some companies even found that these changes resulted in higher profits - especially those with a digital-driven business model such as the Dutch online food retailer Picnic. Online food retailers experienced an unpreceded surge in demand for their services, as the appetite for visiting supermarkets plummeted.


2. Action brings a purpose to life

Many are suspicious of words like 'purpose' and lofty corporate visions - and with good reason. For a long time, politicians and corporations have tried to create followers through promises they would not, or could not, keep. However, the internet has introduced a new level of transparency for society. Broken promises can be exposed both instantly and globally.

The COVID-19 pandemic has made the distinction between words and action even more clear. ‘Purpose’ has been a boardroom topic for a while, and most top executives talk about their company's purpose and role in society. The crisis has, however, forced companies to act on it. Trust and belief are built through action, and the market has rewarded companies that demonstrate responsibility. It will become increasingly difficult to communicate a purpose that is not supported by significant action.

A clear purpose helps organizations respond to crises more effectively. It builds loyalty amongst both customers and employees. Deloitte’s latest millennial survey⁴ found that Millennials and Gen Z show more loyalty to employers that take their societal role seriously. While the pandemic has caused the concern for health care to rise, climate change remains the top priority for the younger generations.


3. From a burning platform to a burning ambition

A sense of urgency enabled us to respond to COVID-19. But while a 'crisis mode' can initiate action, it is not sustainable. As the initial shock and uncertainty diminished, the mobilizing power faded - something history has shown on countless occasions.

Even before the pandemic, the level of fear about the future was high. While COVID-19 demonstrated the mobilizing power of societal challenge, this mobilization was based on fear. Fear shrinks our time horizons and increases our inclination to prefer traditional ways of doing things.⁵ Seeking comfort in the past gives a false sense of security, as conventional solutions are unfit to solve global challenges such as climate and health.
Too often, the narratives used to frame these challenges are simplifications that build on fear and furthers polarization. Such narratives contrast what John Hagel calls opportunity-based narratives⁶: A powerful call to action, based on clear long-term opportunities, mobilizing customers, partners, and talent. Could we use the power of a unifying narrative to answer those societal challenges?


4. Confidence in people's ability to adapt to change

Many senior executives were surprised by how quickly their employees adapted to these overnight changes. If the pandemic made it clear that employees can be trusted to work from home, might the next level be to provide them with the freedom to find new solutions that meet rapidly changing customer needs?

Companies could also pursue another quite simple-yet very challenging-approach to radical innovation. It requires leaders to shift their trust from their processes to their employees. Combining this trust with a strong sense of purpose throughout the organization can significantly increase the impact of related actions.


5. No more searching for the cause

As the world becomes increasingly complex, looking for a specific root cause of any event may lead us down the wrong path. As the debate on the causes of the COVID-19 pandemic continues, identifying its origins may be less important than developing our ability to respond to unexpected future events.

After all, the main learnings from the Titanic were not that we needed to make the ships larger and iceberg-proof. They were about people and the processes directing behavior. If we focus on another COVID-19 outbreak, we may end up less prepared for the next, altogether different, challenge. Instead, we need to develop our ability to respond to the unexpected. We need to nurture the capability to respond to change.


A blessing in disguise?

Transformation initiatives in organizations typically fail, as people find ways to protect themselves and their domain from change⁷. Among the many responses to the pandemic, we see a strong potential for transformation throughout organizations. A challenge founded on a clear purpose can mobilize customers, partners, and employees across traditional silos to solve complex and urgent problems. For organizations, it can help nurture trust, an innovative mindset and a sense of positivity⁸.

On a global level, we can use these learnings to address other societal challenges such as climate change. If we manage to change the narrative from one of fear to one of hope, we can mobilize trust and collaboration in the long term. The rapid experimentation and learning we experienced in the pandemic can also be applied to solve problems that are not only complex but entangled⁹.

 

What can we learn from COVID-19-related changes to approach other societal challenges?

As the year is coming towards an end, let us use this time to reflect upon what we have learned and start the next year by applying our learnings to other crises, such as climate change. To summarize, the five learnings from our transformation perspective are:

  1. Leverage natural urgency to accelerate innovation.
  2. ‘Zoom in’: action brings a purpose to life.
  3. Unify towards a common goal - fear does not mobilize in the long run.
  4. Stop oversimplifying and searching for the cause. 
  5. And perhaps most importantly, trust in employees’ ability to rapidly find solutions that can create new value.

This list of learnings is not intended to be complete - it should constantly be evolving. If we continue to learn, we will strengthen our capability to change and expand our capacity for change. Connect with us to share your learnings, as we need insights from other perspectives. We can only create positive change by collaborating across traditional boundaries between societies, organizations, and people.


As Churchill stated during the process of creating the United Nations after WW2: "Never let a good crisis go to waste." If our main learning from this pandemic is how to avoid COVID-19, we have wasted a unique opportunity.



Endnotes

1. Serafeim, George. 2020. "Social-Impact Efforts That Create Real Value." Harvard Business Review. Last Modified 2020-09-01. https://hbr.org/2020/09/social-impact-efforts-that-create-real-value.

2. John Hagel, Maggie Wooll and John Seely Brown, Human inside: How capabilities can unleash business performance, Deloitte Insights, 2020. 
View in article

3. Jack, S. 2020. "Coronavirus: Government orders 10,000 ventilators from Dyson." BBC News. 
https://www.bbc.com/news/business-52043767.

4. The Deloitte Global Millennial Survey 2020, 
View in article

5. John Hagel and John Seely Brown, The paradox of flows: Can hope flow from fear?, Deloitte Insights, 2016. 
View in article

6. John Hagel and John Seely Brown, Zoom out/zoom in: An alternative approach to strategy in a world that defies prediction, Deloitte Insights, May 16, 2018. 
View in article

7. John Hagel, John Seely Brown, Maggie Wool and Andrew de Maar, Approaching disruption: Charting a course for new growth and performance at the edge and beyond, Deloitte Insights, 2016. 
View in article

8. John Hagel, John Seely Brown, and Tamara Samoylova, Work Environment Redesign, 2013. 
View in article

9. Pendleton-Jullian, A. M., & Brown, J. S. (2018). Design unbound: Designing for emergence in a white water world. Cambridge, MA: The MIT Press.

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