In this article Mark shares how he navigated his business through the early days of lockdown and valuable lessons he learned on dealing with a crisis. Keep reading to learn how constant communication is critical, accommodating unprecedented client requests pays off and how in the darkest moments your team really pulls together.

The eve of a world in crisis

If you’ve been following my articles for The Consulting Balance you’ll know that I've been telling Nexient’s story chronologically. We are now in February 2020 so I’m pretty sure you know what’s about to happen. Funnily enough though, at the end of that month I was still quite oblivious to what was coming. I think we sometimes forget how rapidly things changed for everyone in that period between late February and early March.

I’d just landed on a Sunday afternoon flight from a personal trip when I got a call from a board member. He was asking what we were planning to do about the incoming pandemic. We weren’t actually doing anything at that point. I'd read about it, but hadn’t really grasped what was approaching. A great thing about working with the venture community is that they are always a step ahead on trends and events, and this was the wake up call (literally) I needed.

How we introduced remote working

Even though Covid was an extraordinary event, it helps illustrate some lessons we learned on how to deal with a crisis. And this was one heck of a crisis.

Our whole business was centered around a delivery center concept. That meant that our product teams all worked out of our primary delivery center in Ann Arbor, MI or our recently launched second center in Columbus, OH. Security in our buildings was hugely important to our enterprise customers and always formed part of the initial checks when a new client signed up. We had no formal work from home approach.

Also, we embraced Agile across everything we did. I was particularly proud of this. We moved in sprints of a week or two and we constantly looked back to see what we could do better. It was a methodology that adapted well to running a company but at that point meant being “on the ground” was critical.

The idea of working from home was looking like an insurmountable challenge. When I gathered the executive team in the first week of March to tell them it was looking likely, they initially thought I was crazy. I pointed to the tech firms in the Bay Area who were already moving that way and it then sank in. We decided we needed to urgently pilot a remote working setup to see what issues might block us from doing it broadly. This was a great idea as it helped us identify and deal with a few technical issues (VPN scalability) and legal issues (client contracts necessitating permission to work remotely). We then rolled it out, with our entire 700-strong company working from home within ten days of us initially talking about it.

Handling difficult client requests

The challenges then got even more real. We started hearing from clients how they were going to handle the situation. A small number said that they were going to cut projects until they understood what was going on. A larger group asked us to provide them a discount. Some even asked for lengthy payment terms. They wanted us to do the work, but bill them 90–180 days later. I never understood the logic on why a small services firm should effectively loan money to a Fortune 100 enterprise, but I didn’t argue.

All of this gave us whiplash. Over the first two months of 2020 we’d hired 79 new people. Hiring, onboarding, and integrating that many people was a ton of work. We then had to turn around and roll off 120 people from eight different client engagements. We'd also given discounts of 10-30% on 56 more clients to try and extend their work. We had accepted slower payment terms on another 120 people in order to keep them. These slow payment terms were especially painful as we would pay our employees immediately and then wait three to six months to get paid by the client. We were very fortunate to have a strong balance sheet by this point so we could make it work.

Communication is key

We realized quickly that we needed to communicate frequently with our three key stakeholders: employees, clients, and shareholders. We jumped into getting all three communication patterns set up.

All-company emails were sent almost daily and we started having short all-company meetings with more than 700 people calling in. Initially these meetings were twice a week and then we settled into weekly. We held very direct, open calls, leaving time for anyone to ask questions. We answered a lot of these with “we don’t know yet,” but the fact that we were even doing that helped people understand what we were focused on and how we were approaching the whole thing.

We started the client communications equally quickly. In the beginning we sent out an email to all of our clients several times a week and offered up calls with the executive team for any client who wanted one. These calls were crucial for us to understand where we stood with clients and what was most important for them. Many told us that we were their top US provider and that if we could help them in the short run, it would lead to more work in the long run. This gave us the confidence to make the various concessions that were requested such as roll offs, discounts, and extended payment terms.

Updates with the board were ramped up to weekly. In the prior year, as part of the company having matured, we had moved from monthly board meetings to quarterly board meetings. Jumping all the way back to weekly sessions was quite a shift, but with things changing so quickly it made sense. We could keep the board up to speed on everything we were doing and why. It helped them to be on the journey with us and understand why we made each decision.

What I learned

This initial phase of the crisis was all about the company taking repeated blows to its model and us as a leadership team moving as fast as we could to do the right thing for the long term. We were incredibly lucky to have a strong balance sheet when the crisis hit – this gave us the luxury of taking a long view.

What we learned over that terrible period can be translated into any context. I truly hope you never have to experience anything so catastrophic but if you do, this is my advice:

• Constant communication is critical – The number of hours the executive team and I spent communicating with each other and with our key stakeholders was mind-blowing. Every bit of it was worth it though. When we looked back after the first two months of the crisis, the number of major changes we had made to the business model was amazing. Keeping our employees, clients, and board members up to date each step of the way was critical to getting that much change done that quickly. It was so helpful to have everyone aligned the whole way.
• Play the long game with clients – There were many moments when it was tempting to push back on client requests. When a company with billions of dollars asks a small company with a few million dollars for free financing, it’s tempting to say no. We said yes to all of it. Our general response was “how can we help you get through this?” Most of the people who asked us for these concessions were being pushed to get them, so asking them to fight it would've been futile. Making it easy for them to deliver what they needed created incredibly valuable good will.
• A chance for your team to gel – I often think that teams don’t really gel completely until they’ve had to go through something difficult. The process of banding together and meeting a challenge is a great way to build trust within your team. Our executive team was always strong at teamwork, but we took it to another level going through this crisis together.
• You’ll learn where you stand with clients – We heard from several clients that we were their number one US vendor. Because of this, they told us that we had an opportunity to grow our share of their portfolio in the long run. I suspect that the conversations other consulting firms were having were far less positive. When things are difficult, your clients will tell you exactly where you stand. In our case, it worked out well for us

‍