Management’s Responsibility
McKinsey is starting to do very good work in the COVID-19 area. Credit them for coming up with the term a “crisis nerve center.” We will call this the CNC.
We cannot send our people back to work and simply assume that COVID-19 protection measures will be serious and sustained without proactive oversight. This requirement really applies to any business, from very small to huge.
The following will lay out some principles. It would be up to owners and senior executives to figure out how to apply them in their businesses through structures and processes.
COVID-19 is a novel and totally unexpected new reality. For now, it is a moving target. Someone needs to be in charge of the CNC. Someone needs to be, or to manage, the crisis nerve center.
The CNC needs to make a regular assessment and iterate from the starting place of CDC principles to new COVID-19 processes, policies, and plans, changing any piece of this as new data and experience becomes available.
The CNC needs to be, what McKinsey calls, the “listening post”. Someone or some group needs to be thinking about this and learning about this on a daily basis.
The CNC needs to develop contingencies that would be triggered by indicators/metrics for immediate or strategic action, such as data or assumptions that become invalidated. Any business that reopens needs to stay out in front of this crisis which likely will be with us for a long time. When changes are required, they need to occur quickly. Hence, a business which reopens needs to place a high value on flexibility in just about everything it does.
McKinsey says the crisis nerve center needs to consider as wide a set of factors and requirements as necessary in these five areas:
- Protecting the Workforce
- Stabilizing the Supply Chain
- Engaging Customers
- Stress testing the Financials
- Operating the nerve center.
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Reflections of a CEO on the COVID-19 Regulatory Atmosphere
Data without context is nearly useless. This probably best sums up my frustration as a citizen and a business manager with our government as well as the raft of pundits discussing the science, politics, economics, etc., of all this. In order to draw any meaningful conclusions, we have to be very careful we understand what information is, how it was collected, under what conditions, and by whom.
For instance, it is beginning to be clear that the number of confirmed infections is not the same as the actual infections. In fact, there may be an order-of-magnitude (or more) between the two. However, the former is constantly touted as a valuable indicator, worthy to drive decision-making. I am beginning to think the reason for that is nothing more that it is a measurement – you can run tests, aggregate result, and produce a statistic. You can’t with actual infections (at least not yet).
But what do confirmed infections really provide you as a datum? Yes, it shows, to some degree, the spread of the disease. It might also give you trends, but that’s a second-order statistic, which only compounds any errors or poor interpretation of the underlying statistic. But we use this statistic, and others, to justify a great deal of authoritarian political activity at the moment.
Now, as has been famously said, the constitution is not a suicide pact. I’m not impugning any activity that requires us to restrict our movements for the good of society, but I do think you really have to know what the hell you’re doing and why when you start significantly and negatively (and for some poor folks, permanently) impacting people’s lives.
Of course, many arguments have been predicated on the idea that “people’s lives are more important than money”, to paraphrase the Governor of New York. But of course, as we all know (and live) this statement is highly dependent on context, and is (perhaps sadly) often violated in everyday life. It also gives the impression that a specific action (“lockdown”) actually produces the touted benefit (“saved lives”) in a manner clearly disconnected to a rejected consequent (“making money”). In the context of COVID, in my opinion, this impression should be rejected, based on the data we have.
Social distancing is connected to reductions in infection in a nearly anecdotal way. It is much like the idea that we should fight global warming by primarily reducing fossil fuel usage. Indeed, if we stop using fossil fuels, we will slow global warming. If we social distance in the extreme (quarantine), we will stop the spread. But we can’t just stop. We must be more nuanced. But there appears to be precious little extant science on the actual mechanism of the spread, and the degree to which separation works, or if separation is better or worse than alternatives with other costs. (With facemask usage, this problem is even worse.)
Sweden, it appears, has decided that the science, and social cost/benefit, are such that a different approach is called for. We will only know if that is a good or bad idea after the fact. But no one, in my view, can justify it’s rejection. Those that have done so to this point appeal to emotion or metaphysics.
The reason why all this matters to me at the moment is that I am far from the only one who can look at the current data, media, journalism, and come to the same conclusion. The man in the street can and has been. But many of our political leaders have based their societal control measures and timelines on facile arguments like the one from New York above.
Suffice to say, authority without rational justification is dangerous. It is dangerous not so much as to what it may become (we’re not all about to be fascists), but what it may make people do. In California, we are seeing this. Yesterday, Main Street in Huntington Beach was crowded to the gills. People were out, en masse, to greet the sunshine and to make a statement, if only to themselves: I have the right to be here. The Governor of California is not my father, and I do not accept his petty punishments (the state beaches in Orange County had been closed earlier in the week as a direct response to the Governor’s evaluation of the people’s poor social distancing behavior). To this point, California has done fairly well during the crisis. But all that may be lost as the state’s ability to influence behavior quickly unravels.
I think there are parallels in the workplace. Command and control in an environment like this has tight limits. If our employees reject our direction related to COVID, I don’t see how policy will help. We have been trying to carefully evaluate our workplace options (in accordance with the law as we understand it) and then communicating both our direction and our justification. We appeal to higher authorities (CDC, CA Dept of Public Health, etc.), but we also try to be reasonable and rational. And we let folks know our reasons. We won’t get it all right, but I’m happy to report that our staff seems confident, and I know they’ve been productive.
Thanks for letting me expound! Good luck with you continuing efforts – they are very much needed. More thought, less reaction.
