The speed and intensity of COVID-19 rapidly exposed weaknesses in communication and the consequences of poor collaboration.
Suddenly, traditional ways of working were thrown into turmoil as travel and physical meetings ground to a halt. Information flows were not only disrupted, but organizations rapidly discovered how little information they actually had. Trying to predict supply shortages, or demand impact, or the availability of transport were among the many blind spots that emerged. With vast numbers working from home, not only was it difficult to access information, it was also challenging to find out who might have critical knowledge or insight.
Collaboration – where it existed – rapidly proved its value, whereas relationships that were already strained tended to deteriorate further. There was a major contrast between those customers and suppliers who reached out to their trading partners in a spirit of cooperation, versus those who simply flooded the market with notices of Force Majeure.
So what have we learnt?
In times of uncertainty, communication is everything. It needs to be rapid, timely and empathetic. Even if key information is lacking, it is important to advise others of that fact and to indicate what is being done to address it. Traditional communication channels and methods may need to change. For example, the regular meeting by the account manager at the customer’s site won’t happen, but maybe there needs to be almost daily contact from the contract manager to provide updates or alerts on issues. As part of good relationship management, organizations are establishing ‘communication protocols’, which may even be a formal contract supplement. Customers and suppliers need to improve definition of the way they communicate and also with whom to communicate.
In times of stress, it is easy to lose sight of others and the need for collaboration. Yet it is essential, not only in the context of sustaining existing relationships, but also in forming the new relationships that may be critical to avoiding or solving problems. Some great examples of collaboration have emerged – for example, in working through supply shortages, reductions or diversions in an effort to minimize their impact; or in better understanding counter-party cash flow or funding impacts and working together to overcome them. It was also through collaboration that innovation started to occur – for example, customers and suppliers working together to design methods for ‘virtual acceptance procedures’ for new plant and equipment.
Examples of collaboration extended beyond traditional trading partners. Corporations started to exchange knowledge and information both across and within industries. Practical issues, such as understanding the different definitions of essential workers or of social distancing regulations in different states or jurisdictions; exchanging experiences in dealing with different government agencies or programs; sharing ideas for a crisis management playbook. But collaboration went further than this and even competition authorities relaxed many of their rules to enable information flows and practical cooperation between erstwhile competitors. Examples included sharing facilities and even in some cases temporarily stocking replacement parts or components to support a shared customer.
And as we emerge ….
A new normal or a return to the past? Certainly many of the learnings from the pandemic will continue to be applied. Methods of communication will not revert to the old model. Working from home will continue at higher levels than in the past. The quality and integrity of communication methods and models will continue to receive focus as we increase dependence on technology. The technology itself will also undergo major improvements to meet those needs, drawing from the experiences and challenges created by the pandemic.
Among those changes in technology will be an increased focus on the integrity and quality of data flows (so critical in contract management) and also in supporting collaborative working. But will the existence of better tools actually result in a behavioral shift towards true collaboration? The tendency to think only of our own interests, to use power to assert our own point of view, is so well established in business practices (and measurements) that it will be hard to break free. Will contracts actually become more balanced? Will risk actually be more fairly allocated? Will value and outcomes actually become the determinants of success? The pandemic has clearly illustrated that we can work this way, that it is a much more satisfying way to work and that it brings positive results. But will it survive? Only time – and our own determination – can provide the answer.
The IACCM TASK program on Online Communication and Collaboration starts on 29 June and can be accessed at https://www.iaccm.com/task/online-communication-collaboration/