When I am doing my cardio around 4:45 a.m., I bounce my TV watching between ESPN and CNBC. Sports and business—what could possibly be better? The conversations dominating both networks are the rate of change in society and its impact on sports and business. People are constantly talking about the inability to predict, well, anything. Think about the easiest things to predict in the past: the start of the NFL season, the end of the NBA and NHL seasons, NCAA football starting, Major League Baseball, etc. You get the point. Right now, these organizations can’t predict when to start, if their season will finish, if and how fans will return to stadiums and what might be the permanent effects of COVID-19 and social unrest? Smart businesses are setting themselves up for highly adaptive behavior to the environment around them to survive and, we hope, thrive. In years past, these organizations would only need tactical behavior to follow the schedule, get games executed and harvest the predictable successes.
There is a military term for this: VUCA (volatility, uncertainty, complexity and ambiguity). Volatility is the rate of change—have we ever seen changes happening this fast? Uncertainty is not having clarity about the present—have we ever been less clear? Complexity is when there are multiple decision factors—have we ever seen so many potential issues, threats and opportunities interfacing with one another? Ambiguity is when you can have multiple interpretations of outcomes from all the complexities—have we ever seen a more ambiguous environment?
Fact is, club owners have always dealt with VUCA; it’s just that now every aspect of VUCA has its dial turned to a 10 (or an 11 for fans of Spinal Tap). What the military knows is that organizations, teams and individuals must display a high amount of adaptive behavior in high-VUCA environments and must have faster and better information to create context and to allow solutions to emerge.
Right now is a great time for everyone to reread, or read for the first time, “Primed to Perform: How to Build the Highest Performing Cultures Through the Science of Total Motivation” by Neel Doshi and Lindsay McGregor. In the book, the authors lay out how companies deal with VUCA and how to build a culture that is extremely adaptive and resilient in a high-VUCA world.
Within the context of a high-VUCA world, club owners I have spoken with who have reopened their clubs are generally optimistic. Members are coming back to the club with returns increasing each week, sales are high (some of this is due to some permanent closures of competitors), and members have been happy with the changes they have seen when they returned.
Maybe things will progress in a linear fashion from here, but I give it almost no chance of doing so. What can we do? First, we should leverage technology for getting better information faster. This should come from operational data such as usage (i.e. check-in comparisons and unique visitor comparisons), member experience data, financial data, COVID-19 tests and case data in your area, etc. Secondly, start playing out multiple scenarios now and work with a team to ideate what opportunities might exist in each.
The questions I am trying to gain clarity around are:
- What does over-crowded look like now compared to before?
- How can we serve the people that can’t fit into class but want to?
- How might an increase in my dues affect immediate cancellations?
- If I doubled my price and kept two-thirds of my members, what opportunity or threat am I creating in my market?
- How will member perceptions change in the next few months?
- What effects of COVID-19 will be permanent on the fitness consumer and what will be temporary?
We are all trying to gain as much useful information as possible to find some assurance as to what is coming our way before it gets here. Success is not as predictable as it once was. We all need to utilize technology in better and faster ways to support an agile strategy.