How Transformations Can Learn from a Crisis

Remember Greece in 2008?

The Greek economic crisis and associated austerity measures have led to negative social impacts that are still felt today. At the height of the crisis in 2013, general unemployment rose to almost a third of the population with significant impacts on wages and household consumption. Athens was the epicentre of the crisis, experiencing a 51% increase in poverty.  Given the financial mechanisms of the crisis, the most affected were the unemployed and self-employed, young and middle-aged families as well as people paying rents or mortgages.

Traditionally vulnerable groups, such as farmers and the elderly, were comparatively less affected than urban wage-earning families.

Among those that still had an employment, the economic crisis led to a worsening of labour conditions with people having to work longer hours and losing many of the labour protections that existed previously. These precarious labour conditions made farming and the opportunity to be one’s “own boss” incredibly attractive.  Work conditions were becoming so difficult that people linked the crisis and living conditions in the city to a “loss of humanity” that could only be regained through a process of personal transformation.

The result was an exodus of people back to the land to become farmers and a whole wave of personal transformations.

Transformations that were triggered by a crisis.

Crises are defined in a broad sense as "collective stress situations" which change how we understand something is organised and structured e.g. society.  Depending on their level of stress, they can lead to system-level transformation as we saw in Greece.  People’s personal beliefs were shaken to the extent that it made them view the world differently and take personal action for change.

What we have seen here is how a crisis can accelerate transformative change – more than the best laid out transformation plans – because it’s a shock to the system to remind it that it’s alive, a living entity with more latent skills than leaders recognise or fail to realise.

Crises accelerate transformative action because they require a response. By taking action – especially in uncertainty – we create results and results are what we learn from to inform decisions, course correct and take better action in the future.

It’s a counter-intuitive approach because the nature of uncertainty means we don’t actually know what to do. But paradoxically, the only way to get the information we need is through action – taking your best guess, starting small and learning your way through.

Beyond Greece, the entire world went through a crisis back in 2020 when Covid struck.  What we saw in this period was a whole new level of transformative change.

As we know, leading transformation in large organisations is tough. It requires patience, persistence and can feel like an uphill struggle against the system that can’t get out of its own way to evolve. Millions of pounds, countless hours and bucket loads of energy are poured into organisations to encourage revolution. How many true stories of success do we see?

What we have seen though both in Greece and, more recently in Covid, is that crises can bring the best out of people.  It was fascinating to see how the clarity of mission - and that time it was a collective mission of survival - connected people together to drive an intrinsic level of motivation, which in turn drove collaboration to succeed in high-pressure high tempo situations.

We saw the NHS holding patient appointments online and giving us an app to see our patient records.  Remember Joe Wicks famously leading what felt like the whole country through online fitness sessions? Dyson started producing ventilators and local stores sorted appearing online with their own YouTube channels.

And the business world transformed overnight. At Tesco bank they were able to implement an increase in contactless payment limits in days, when previously it would’ve taken months. They and other organisations found a way to decamp overnight to work from home using rapidly prepared laptops. Company meetings went online with Zoom and we all suddenly worked out that people can be productive, and indeed be trusted, to work out of the eyesight of their manager.

It did seem at the time that organisations grasped at speed the benefits of lean and agile processes enabling them to react faster and make quicker decisions. But, if that is true, what brought that about.

Is it that a crisis unshackles an organisation’s ability to apply these principles when before they were suffocated by bureaucracy, siloed thinking and risk aversion?

Covid certainly focused people’s minds.  It gave them a shared purpose which was easy to understand, and which tapped into their intrinsic motivation. Suddenly, the objective was clear and crisply defined with a clear call to action.  Teams could see themselves tackling challenging problems and able to deliver real and successful outcomes for their customers.

Covid-19 also led to radical organisation wide reduction of initiatives, a forcing-function to focus teams on a shared small set of priorities, where otherwise organisations battle many competing priorities often creating confusion.   It created a simplicity with a succinct set of objectives that was both powerful and attractive.  A bit like a football team knowing that it needs a goal in added time or they will be knocked out.

By harnessing this true sense of purpose, the simplicity that comes with it, and the associated compelling motivation, we then saw further knock on effects that made successful outcomes far more probable.  Individuals and teams had a far clearer focus and were more able to see the impact of the part that they played.  At the same time, people became more outcome focused and thought of quicker smarter ways to achieve their goals.  And research since has talked about how Covid19 enabled organisations to focus and take smaller steps, faster.

Another aspect that seems to appear was enhanced collaboration maybe because of the breaking down of political barriers or the reduction in risk aversion that often suffocates an organisation.  Indeed, people reported a shift in culture and people values — especially as leaders started to role model new behaviours and acceptance of imperfect results.

It appears that in the face of crisis induced uncertainty it has now become acceptable at all levels to “learn as we go”, adapting to the crisis and changing when required.

What crisis creates is a situation that isn’t artificial. It’s not a training, a simulation or a story of what great looks like—it’s real. And in this scenario, people get to see, feel and experience the benefits of applying these ways of working for themselves.

The biggest hurdle to change is people not believing it’s possible. In Greece, thousands upon thousands of people combatted that and made their own choice to act.  Similarly, with Covid, the pressure of the crisis has prompted people to act differently, provided a new perspective and impacted their mindset for the better. It created the forcing function to react, grow or be left behind.

How we can leverage that experience of managing a crisis for the benefit of future transformations is the big question.  Can we learn from them or do we lapse back into our old ways of trying to do too much, not being clear in our real purpose, and forgetting the importance of creating intrinsic motivation in our people. 

We’ll see.