We need to talk about the pandemic post-mortem. Five mechanisms to avoid future catastrophe.

Humans are surprisingly adaptive creatures – many of the changes wrought by the pandemic would have been unthinkable in an earlier era. And yet, we’re also remarkably blind to changes happening right under our noses. Here are some reflections, with just a month to go until the paperback launches.

We always do the right thing in a crisis; why can’t we manage that way all the time?

A refrain I’ve heard from many leaders as their organizations grappled with the crisis was how remarkably well their organizations tackled it. They made fast, conscious, courageous decisions. They dropped internal politics and posturing. Sworn competitors in industries such as pharmaceuticals shared incredibly sensitive information and worked together for the common good. They mobilized a work-from-home army which turned out to be, for the most part, surprisingly productive. Clock speed, overall, seemed to accelerate.  

While this was a pleasant realization for many, research by Martin Reeves of the Boston Consulting Group (and a recent Friday Fireside Chat guest) offers some clues as to why so many responded so well and creatively to the crisis. In his terrific book with Jack FullerThe Imagination Machine, they point out that human imagination is triggered by surprise. As they say, “If your brain never encountered anything that was different from its existing mental models, it would never have cause to change its thinking. Contact with surprise – encountering something that doesn’t fit – is the starting point for imagination.” As they say, eventually an idea that began with a surprise, if it spreads, eventually becomes unsurprising: an ordinary and accepted part of reality.  

It’s become almost a meme to say that COVID19 was an accelerant to all things technological. It’s also become an accelerant to a number of other, very significant trends in employment and organizations. It’s brought questions of equity and diversity to the forefront featuring everything from corporate boards (with NASDAQ actually putting some teeth into the effort) to what the New York Times calls the “Wedding Industrial Complex.” It’s made mental health discussable in the culture and the workplace. And it has raised the significance of creating a more just and human society, with younger workers pushing back on rigid workplace norms, even before the pandemic upended traditional work.  

One of the more interesting post-pandemic possibilities is the potential emergence of a new “golden age,” a possibility that features prominently in Carlota Perez’s writing. Indeed, as Peter Sims suggests in a terrific article on Medium, we may be on the brink of a new renaissance, not dissimilar to the way in which it took the Bubonic plague to shake loose the ossified structures of the middle ages. As he points out, when you look at golden eras they are filled with new human energy, led by artists. We’ve learned we can do it in a crisis – perhaps this will teach us to do it every day. 

But it takes “Cathedral” thinking to invest for a more resilient future

Another surprise, and a far less pleasant one, was how badly our systems were prepared for the pandemic, despite literally hundreds of warnings that it was a matter of when, not whether, one would occur. Betsy McKay wrote an article in 2017 (2017!!!) predicting not only the likelihood of a pandemic but that it would probably come from bats, naming specific places where human/bat contact were likely. As Peter Daszak, a disease ecologist and President of the EcoHealth alliance pointed out, “We travel the world in one day, and we take the viruses we pick up with us. That’s how viruses become pandemics.”

This gets to one of the more difficult human challenges of seeing around corners. This is persuading human beings that they have to take action that costs something or takes effort in the here-and-now when there’s a chance that if they just push it off into the future they won’t be affected. We certainly saw that kind of thinking with respect to the pandemic, to the point of weakening provisions that were already in place as a consequence of previous dangerous viruses such as Ebola and MERS. We see it in risk-averse CEO’s who want to just wait things out rather than take on a necessary transformation. We saw it in the disastrous collapse of the Champlain Towers South, with bickering among board members and deferred maintenance likely contributors to the disaster.    

Given this, I’m very taken with an analogy that was described to me by Jennifer Weber, the global head of Human Resources at Food Giant ADM.  One of her previous bosses suggested that what was needed was “Cathedral thinking.” I was expecting her to tell me about the tired and over-used example of two bricklayers, one who was just laying bricks, and the other who was so inspired that he described what he was doing as building a cathedral. That gets used a lot in classes on management and leadership. But she pointed out something entirely different. Those people working on cathedrals in the middle ages did so knowing for the most part that they would never see them completed, with some taking literally centuries to be finished. And yet, commitment to making an enduring impact led to a long-term perspective.  

5 Factors that can help us build resilience and avoid catastrophe

Which brings us back to the question of how we can nudge people to take action in the present when we don’t know for sure what the future will hold. There are several factors that make it more likely that we’ll both pay attention and do something about it.

1. A vivid story. Repairing the so-called Y2K bug, in which computer systems were programmed with only two digits for the year, cost a stunning $100 billion one contemporary observation reported. And even today, there are those who feel that the risks of something going wrong were overblown. But the experts working tirelessly behind the scenes didn’t think so – as one reflected years later, he wouldn’t have been confident in day to day activities like flying if the work had not been done. President Bill Clinton made the fix a priority, encouraging government to “put our own house in order.”  

2. Helpful Cassandras. As I wrote toward the end of 2019, an important source of information that something real and significant is about to happen are what Andy Grove famously called “helpful Cassandras.” These are people, often with a technical or scientific background, who see the implications of new development and can alert you to them. For example, I was talking to a former researcher at Kodak who was all excited about a potentially market defining innovation, only to be met with the phrase “but the  market doesn’t exist?” “Exactly- that’s the point!” “Well, how can I tell my salespeople to sell into a market that doesn’t exist?” Groan. And another project that went nowhere.

3. Multiple resource pools and champions. A characteristic of systems that build in greater resilience is that they have multiple potential responses, not just one. This is why monocultures in biology are bad – let something affect that one type of plant, say, and you can end up with a famine. Same in business, as Safi Bahcall’s wonderful book Loonshots points out. If you have more than one potential response, you’re much more likely to be able to meet a challenge.  

4. Change the incentives to give actors an interest in the future. Another way to make sure that people care about the future is to require them to have a stake in what happens down the road. This is the intuition behind clawbacks in financial services – lessening the short term gains that can be created by excessively risky speculation. It is also the traditional way in which investment firms balanced risk and reward, by operating as partnerships (which observers note has diminished their interest in the long term).

5. Let Big Brother manage it. Finally, of course, we have governments and public policies – entities who exist because it is almost impossible for markets to properly price costs and benefits when individuals benefit (or suffer) asymmetrically. Rebecca Henderson has been encouraging us to rethink capitalism for some time.  

In any case, the paperback version of Seeing Around Corners will be out next month – and we’ll be talking about it in Columbia Executive Education's one-week live on-line course "Leading Strategic Growth and Change."

Share Thought Sparks

Get in Touch, Keep in Touch!

You can follow me on Twitter (@rgmcgrath), on Instagram (@ritamcgrathofficial), on LinkedIn and on YouTube. For access to the archives, ability to make comments and read longer versions of my regular communications, subscribe.  

We’re also ramping up some interesting offers at Valize. For instance, we’ve revived the BareBones net present value calculator featured in my book, Discovery Driven Growth. You can download it for free from the Valize web site here (click on the book).