A fascinating picture of one brand’s journey through the earliest phase of Covid-19 has emerged from the latest financial results of high street retailer Next. (Next Plc, 17 September 2020)

Tracking the firm’s 2020 performance up to the end of June, the bulletin from CEO Lord Wolfson reveals that sales during the Covid era have been resilient, despite the related challenges, and that the firm has engaged in productively innovative behaviour. In parallel, though, it has encountered difficulties with internal communication.

“The pandemic has been expensive and miserable,” Wolfson writes. “But some good has come from the upheaval. It is remarkable what can be learnt from shutting down your entire operation and slowly, department by department, store by store, warehouse by warehouse, bringing it back to life.

“We have learnt how we can work more effectively. Lessons which, if we are careful to preserve them, will stand us in good stead for years to come.”

In particular, Wolfson cites innovations in two, key areas:

1. Warehouses “The process of ceasing virtually all warehouse operations and slowly, operation by operation, winding them back up, was instructive. Social distancing forced us to spread work as evenly as possible over 24 hours and in doing so, we discovered we could be much more efficient if we allocated work differently going forward. We also gained an insight into the true costs of stretching our next-day delivery cut off to midnight and we are actively reviewing whether that last hour is really worth the costs involved.”

2. Call centres “At a time when we needed them most, Covid rendered our call centres virtually unusable. We needed to get colleagues taking calls from their homes. For many years we believed this was simply not practical or possible. I am grateful to Alex Baldock (CEO of Dixons Carphone) for sharing his experience on this issue. Within five weeks of Alex explaining it was possible, many of our managers and staff were set up to take calls from home.”

However, delving into the flipside of staff dispersion, Wolfson writes: “By far the biggest problem with home working has been the lack of spontaneous conversations between colleagues. We have missed the chance conversations, unplanned questions, the ability to learn from colleagues, along with the training and camaraderie that the office provides. At its best, an office can be a cauldron for new ideas and enhanced collaboration.”

He adds: “Where problem solving requires large groups to work together, videocalls have proved unwieldy, frustrating and inefficient. Worst of all perhaps, large video calls have encouraged the proliferation of one of the business world’s most damaging practices – death by deck: slideshow presentations that transform meetings from productive exchanges of ideas into boring, one-way lectures, with the ‘presenters’ rattling through bullet points already visible to their stultified audience.”

So, Next has achieved crucial process innovations, boosted efficiencies and sought valuable advice from the CEO of another firm – but still faces challenges with home working. What can leaders learn from this mixed summary of the brand’s Covid-19 experience?

The Institute of Leadership & Management’s head of research, policy and standards Kate Cooper says: “Lord Wolfson has summed up really well the pros and cons of home working, as opposed to being in the office. We know that during this crisis, people have harnessed technology to learn and change very quickly, acquire new abilities and find fresh ways of connecting to and working with each other. All of that has been great for many firms, and has shown that we don’t need to sit next to each other to be able to work well together. However, as Lord Wolfson articulates, what you lose are those chance conversations that can spark discoveries people may not even have known they needed to make.

She notes: “As he suggests, the solution most certainly doesn’t lie in dull, slide-deck presentations that provide only a flat, one-way form of communication. So the challenge, really, is to offset the difficulties with an enhancement of the benefits. And I don’t just mean the financial benefits of reduced office space – but all of the things that studies have repeatedly told us about why people like working from home when they have the opportunity to do so. And for many people, that comes down to flexibility and autonomy.”

Cooper points out: “As with anything new and different – and this ties into our recent blog on the four-day week – the overarching question is: is this sustainable? What are likely to be the unintended consequences, or even those that we’re in a position to predict, and how are we going to mitigate those risks? So perhaps we may encourage our staff to collaborate in smaller groups, and that will enable us to use videoconferencing in a livelier and much more interactive way. And then we find ways of cascading that information into other small groups, with the input of great facilitators who can help people to collaborate.

“We must remember that, for many people, this is a new way of working: you may be great in office surroundings with an A1 flipboard and a marker pen – but perhaps those skills don’t necessarily translate over a webcam. Of course, that appetite to connect and engage will still be there – but you’ll just need to learn how to do it in different ways.”

She adds: “The most important lesson here is that Next really swooped on to the problems they identified around key pillars of the business they absolutely had to protect and keep going. So that combination of quick thinking and decisive action bought them the space they needed to highlight areas for improvement. What leaders can take away from this is that once a particular challenge is out there and firmly in employees’ minds, you can rely on their ingenuity to tackle it in the same way it addressed previous hurdles.”

For further insights on the themes raised in this blog, check out the Institute’s resources on communicating

Source ref:

Next Plc, 17 September 2020

Image of Next signage courtesy of Yau Ming Low, via Shuttertock