28 Jul 2020
Post-pandemic leadership: The CEO of LeasePlan Corporation N.V. speaks out on the coming economic crisis, missing personal contact and defining different types of meetings.
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If COVID-19 and the inevitable economic crisis change the way we work permanently, what does that mean for business leaders like Tex Gunning, the CEO of LeasePlan Corporation?
How have you experienced the COVID-19 crisis so far?
For us, liquidity is the most important thing. Liquidity and managing our cash position are our main objective, where the focus was initially on sales and revenue.
We also formed a crisis team, consisting of the executive committee and additional members, who came together every day for two hours.
The phase we are in now is that we have to start growing again. Initially, we had our sales people working at the service desk to help our customers with (postponing) payments and postponing contracts. Now, they have to start selling again and take orders.
“Our focus has been shifting throughout the crisis. From liquidity and costs, to managing our P&L and now going back into growth mode”
Looking ahead, what perspectives can you share?
At some point a balance will return. However, if you grow too fast, it means that too much risk is being taken and I don't think you should take much risk in this phase of economic crisis.
In the third and fourth quarters, we will see the full extent of the economic crisis in many countries. I live in Amsterdam, and I see more and more shops permanently closed. Whether it's a grocer down the street, or a clothing store, they are close-closed, empty. Total sale.
That will be in the larger companies too. They have not restructured much so far, out of a sense of compassion. Firing people in the middle of a huge health crisis, how are you going to sell that? At some point, reality will set in and you will see these reorganisations and restructurings start to appear.
The United States shows that if you do not control the virus, you have nothing under control and you only get more chaos. That will have a huge effect on people's confidence in the economy. They will save more, spend less, private investments will go down and you will probably get more lockdowns again. You see that in Melbourne, Australia. In Singapore constantly, because of the foreign workers. Interestingly, in China suddenly too. There are more and more pockets in Germany around the meat factories.
If this situation worsens, you get more uncertainty and eventually you will get a slowdown in the economy, because people will stop investing and private consumption will go down.
What adjustments have you made to your own leadership style and techniques?
I’m forcing myself to do more than just follow the agenda, and to start thinking about culture, leadership and strategy. The lockdown has given me time to reflect and put these thoughts on paper, which I prefer to do at night.
However, I do miss inspiration from having face-to-face meetings, because checking in with others happens very little. It is in these conversations that you hear things and that you are more likely to identify a good point. When you miss these conversations, you miss cues that make you say ‘hold on, this is important’.
“You don’t know what you might miss without input from others”
Therefore you will still need to have meetings where you see each other in person, where energy is important, where you have to be creative. Not in the sense of inventing a new car, but in your thinking. Therefore we have defined different types of meetings and the problems we are solving; orderly or non-orderly problems. If these require face-to-face contact, they happen on an ‘office-day’, while all other meetings are done virtually.
To give an example; we have to devise a strategic plan for the coming years and the budget for the coming year. These are processes you cannot do virtually. You need to be in the room together, able to read body language, use emotions, connect with the team again, talk about what is going well and what is going wrong. So, in September, we’ve planned two days for leadership- and team training off-site and two days to work on the strategic plan on-site. This is our new normal.
“I am convinced we will never go back to five days of working in the office”
Whether it will be two days or three days, we will start structuring things in a way and help people so they can determine their arrangement themselves. Many of our people are much more effective when they work from home and can organise their day much more effectively.
Additionally, if people go to the office two days less, we’ll have 40% less CO2 emissions from cars, 40% less traffic jams, 40% less travel time. So it provides all kinds of very significant effects on traffic, on the environment, on people's use of time, their perception of being in control of their own lives and of their own work. We have seen that our people act responsibly. I cannot know whether my people work 40 hours, 30 hours or 50 hours, but as long as the output is there, we trust them.