Some people may disagree, but I think that Victoria made a real mess in the way it handled the virus.  More people have died in Victoria than the rest of the country combined, and the economy has been devastated.  Hundreds of thousands of people have lost their jobs, and thousands of SME’s will never open their doors again.  Thousands of entrepreneurs have seen their dreams shattered, and lost their money.  The mental health of the population has been badly affected, with calls to help lines increasing dramatically.

All in all, it has been a disaster for Victoria.  As has been said by many commentators, both professional and amateur, it has not been Covid 19 that has done the damage – it has been the reaction to Covid 19 that has caused the devastation to the state.  One of my favorite sayings is – it’s not what happens, it’s what you do about it.  And what the Victorian government did about the virus is what matters,

So what can small business owners learn from the debacle that was the Victorian response?

Well, I think that the government, and in particular, the Premier, failed on three fronts.

Firstly, he failed on the question of management;

Secondly, he failed on the question of leadership; and

Thirdly, he failed on the question of culture.

There is no question in my mind that all three of his failings were equally responsible for the terrible position Victoria and Victorians find themselves in today.  Let’s examine the contribution made by each of the failings.

Management

I would split the failure of management by the Victorian government into 3 areas:

  1. Preparation
  2. Execution
  3. Management of consequences
  1. Preparation

By all accounts, Victoria’s health department was the worst funded health department in the country.   For whatever reason, the government, over the years, didn’t deem it necessary to ensure that its health department was in a fit condition to handle any situation that would arise.

The department was also not technically advanced.  When the pandemic hit, and contact tracing was an issue, it came out that Victoria, unlike its counterparts in other states, was still using pen and paper and fax machines in the contact tracing department.

It also seemed that the organization of the department was strange.   The Chief Health Officer (CHO) was not at the top of the pile.  When decisions were made, it seems that he was left out of the loop, instead of being the “go to” man.

So, all in all, it seems that the Victorian Health Department was in no position, financially, technically or organizationally to handle anything as serious as a pandemic.

  1. Execution

The shambolic handling of the hotel quarantine system has been exposed and discussed at length.  For his own reasons, Daniel Andrews decided to use private security contractors to police the hotel quarantine rather than the ADF and the police, as used by other states.  (I’ll talk more about this decision under the heading of “Culture”).  

While the decision in itself might not be the reason for the disastrous consequences, security guards were a strange resource to turn to.  Security guards are generally casual workers, working in more than one organization and in more than one job at the same time, and are not of the most highly qualified in society.  Many, if not most, are not particularly highly trained, and would not be the first choice for a delicate operation like ensuring that returning travellers, who would be unhappy with their incarceration in hotel rooms, would follow the rules.

And then, the training given to these guards was basic in the extreme taking no more than a couple of hours, much of it web-based.  In fact, rather than being trained in infection control, and the proper use of Personal Protective Equipment (PPE), and the need to ensure compliance with the rules, they were given training in  – diversity.  

So, not only were the people being used the wrong people, but they were almost totally untrained for the very important job that they had been tasked with doing.

The result was not to be totally unexpected.  The job wasn’t done properly, infections leaked out of the hotels, and nearly 800 people died as a result.  The debacle also led to the strictest lockdown in the world, and that brings me to the next failure – the management of the consequences.

  1. Management of the consequences

As I said earlier, it’s not what happens, it’s what you do about it.  And here, the Victorian government has failed hugely.

Daniel Andrews is the CEO of a very big enterprise called the State of Victoria.  As a CEO, he is expected to be able to manage all aspects of the enterprise, and to be able to balance those various aspects of the enterprise to the benefit of the enterprise as a whole.  Any business manager or owner is familiar with the concept of the dashboard, where all KPI’s are visible, enabling the balancing act to take place.

Daniel Andrews seems not to understand this concept at all.  From the time the hotel quarantine debacle became apparent, Andrews ditched all management techniques, and panicked.  He put Victoria in stage 4 lockdown, strangling business and the population.

He basically ran the state on one KPI only – Covid 19 infection numbers.  The rest of the indicators were simply forgotten, as if they didn’t exist.  The result, which I mentioned above, was not surprising.  No business can be run on one KPI.  Imagine a business being run on the sales number only.  Easy to push up the sales – give big discounts, extended credit terms, same day delivery.  The sales numbers will be great – but there’ll be no profit, and the cash flow will look sick.  And that’s basically what happened to Victoria.

This aspect of the failure of management was, in my opinion, the worst, because it showed a lack of understanding of the whole principle of management.  It showed, to me, that the fact that Daniel Andrews has only ever worked in politics, makes him unfit to be the CEO of Victoria.

But Andrews is not working on his own.  He has a whole cabinet to consult – a cabinet made up of people with different skill sets (I presume) who could advise him of the other KPI’s that were suffering. Why didn’t they alert him to the problems occurring in other areas?

And that brings me to the question of leadership.

Leadership

Leadership should be examined in two areas – leadership of the people, and leadership of the management team.

  1. Leadership of the people.

A leader’s job is to inspire and enroll.  He or she needs to inspire the people with a vision, and to enroll them in the achievement of that vision.  Here again, Daniel Andrews failed badly.  When he put the state into stage 4 lockdown, there was no inspiration.  There was only punishment.  At the daily press conferences, all we heard were threats and warnings.  There were warnings of the dire consequences of Victorians not following the rules – we would see infections rise – and threats  – more restrictions, and heavy fines.  At no time did he show any understanding of the pain that people were feeling.  He didn’t seem to empathise at all with the owners of businesses who were unable to earn a living, and had to watch while their businesses withered and died.  He had no sympathy for the people who lost jobs, and found themselves, for the first time in their lives, dependent on welfare.  He just threatened and warned.  He didn’t show a light at the end of the tunnel – we were always told that numbers were too high to relax any restrictions.  And the fact that some restrictions seemed to make no sense at all – the curfew, being able to exercise only for an hour once per day, the 5km distance restriction – meant that many people were not enrolled in the program, because they didn’t believe in it.

Andrews’ apparent inability to listen to advice from anyone outside of his circle of advisors (which I will discuss further under culture) was a source of great frustration to Victorians.  When a group of 600 doctors wrote an open letter to him pointing out the adverse health effects of the lockdown, he dismissed the letter, saying: “With respect, I disagree with them”.  This attitude made it very difficult for people to be inspired and enrolled.

So, as a leader of the people of Victoria, Daniel Andrews failed.

  1. Leadership of his team

What about his leadership of his management team – his cabinet?

There was an illuminating article about Andrews’ style of management in the Australian.  It painted him as a “command and control” leader, a micromanager.  It was said that anyone who disagreed with him was put in “the freezer “ – he just froze them out.  This would explain why none of his cabinet members could alert him to the damage he was doing by the lockdown.  Many Victorians wondered if the Victorian government had a treasurer at all, or a minister responsible for jobs, or small business.  No attention was paid to any of these areas.  In fact, even the CHO seemed to be a Covid Health Officer, not a Chief Health Officer, as the fact that other illnesses seemed to be increasing was not factored in.  For example, the number of deaths from cancer increased, due partly to the fact that fewer people went for cancer screenings.  Suicides increased, and people treated for attempts at self-harm rose significantly.  But none of these elements were taken into account, because the leadership style did not encourage anyone to raise an objection to the course being followed by Daniel Andrews.

What came out of the enquiry into the hotel quarantine fiasco was that it would seem that none of the Andrews cabinet ministers had Position Contracts, spelling out their responsibilities.  A huge decision was taken, but nobody knew who took it.  Of course, it is not really believable, but, from the evidence, it seemed that the decision fell between the cracks.

So, as a leader of his management team, Daniel Andrews failed, because it appears that no one was prepared to voice an opinion contrary to his, and nobody was really aware of their individual responsibilities 

And that brings us to the culture of the government, which is responsible for many of the failings discussed. 

 

Culture

The culture of the Andrews government can be described as hubristic – having excessive pride or self-confidence.  

From the beginning of the pandemic, the Andrews government was determined to do things its own way.  When the AHPPC (Australian Health Protection Principal Committee) determined that it was safe for schools to remain open, the Victorian government decided to close them.  It felt that it knew better than the AHPPC, and did things its own way.

This is the same hubris that led the Andrews government to handle hotel quarantine in its own way – using private security guards rather than the ADF and police.  (There may well have been other reasons tied to the unions, but we’ll not go there.)  It is arrogance, an attitude of “don’t tell me what to do” that can so often lead to downfall.

This arrogance played out in Andrews’ refusal to listen to, or even talk to, the doctors who were concerned about the adverse health effects of the lockdown.  The same arrogance prevented industry bodies, like the events management industry body, or the gym owners, from presenting to the Andrews government their plans for the Covid-safe opening of their industries – which would have put many people back to work, and off welfare.

The advice from economists, from the WHO and the Barrington Declaration that lockdowns are not the favoured method of handling a pandemic were simply ignored.  The attitude is simply: “We know better”.

This arrogant inability to listen to and hear a point of view that varies from his makes it difficult, if not impossible, to learn and change course, where necessary.  

Of course, the way Daniel Andrews has led his cabinet is also a matter of culture.  It is a closed culture, where a different opinion is not welcome.  It seems obvious that Daniel Andrews is willing to listen only to the opinion of people who tell him what he wants to hear, and any other opinion is dismissed.

The other thing about Daniel Andrews’ culture is his apparent relationship to the truth.  He is a politician, and is subject to that old saying that you can tell that a politician is lying by the fact that his lips are moving.  But Daniel Andrews lost many of his constituents because of the fact that he too often told blatant lies.  The most obvious lies came out at the enquiry into the hotel quarantine debacle, when not one of the cabinet members or the bureaucrats could remember anything, and no one knew who took the decision to use security guards.  This was such obvious unbelievable nonsense that it made a mockery of the process.

Lessons to be learnt

So, to summarise, what lessons can be learnt from the failures of the Andrews government?

1 – Invest in your business.

Make sure that the important parts of your business are up to date.  If IT is an important part of your business, make sure that it’s totally up to speed.  If yours is a manufacturing business, make sure your plant and equipment is modern and capable.  Never allow your business to become inefficient – you never know when you will need to shift to a higher gear.

2 – Hire the right people.

You know that it’s so important to have the right people on the bus. Don’t scrimp when hiring – get the best you can.

3 – Train your people well.

The cost of training your team might be high, but the cost of having untrained people in your business will almost certainly be higher.  Make sure your people are all fully trained to do the job they’re supposed to do, and keep training them.

4 – Manage all the KPI’s

This may seem obvious, but it is pretty easy to lose sight of things in the fixation on one goal.  Andrews’ fixation was Covid infections.  Yours might be sales figures, or debtors’ days outstanding, or stock levels.  Each one is a vital KPI, but a focus on one to the exclusion of all others will lead to ruin.

5 – Be a leader.

Inspire and enroll.  Have a vision, and share it with your team.  Get them enthused, even if the vision includes some short-term pain for the long-term gain you are seeking.  Get them to enroll in the achievement of the vision.  Make sure you listen to them along the way, so that the team feels that they are part of the vision, not a casualty of it.

6 – Be open to other opinions and ideas

If you have a management team, use it.  It’s great to have a lot of capable people who have ideas and opinions for you to draw on.  It doesn’t show weakness to accept that a subordinate’s idea is better than yours – it shows strength and self-confidence. 

7 – Don’t give in to hubris and arrogance.  

Never think that you know better than everyone else.  Remember the thought: “Isn’t that interesting?” when an idea is presented to you.  Consider all ideas, even if your first thought is to discard them. Give each one thought.  If, after having given it proper consideration, you still think it’s a bad idea, then you can discard it.

8 – Don’t lie.

Stick to the truth.  When you start lying, you put yourself under great pressure, because you have to remember the lies you told, and stick to the made-up story.  If you tell the truth, it’s much easier, and people will also trust you more, and have belief in you as a person.  Remember, your good name is your most valuable asset, and you should do all you can to protect it.

The way the pandemic has been handled in Victoria should be a great lesson on how not to do things.  Unfortunately, the people responsible for the disaster will probably not suffer at all – they continued to earn their full salaries throughout (in fact, they voted themselves an increase), and will not suffer financially at all.  And politically?  Who knows?  There seem to be a lot of Victorians who think Andrews has done a good job (probably not among the business owners who have lost their all), and the next election is two years away.  Memories are short, and, heaven help us, there is always the chance that Andrews will be voted in again.

The people who suffered are the citizens of Victoria, who lost their freedom.  They lost the ability to meet with family and friends, children lost a year of education, and business owners and their employees lost  the most.  The effects will, it has been suggested, be felt for decades.

If you learn the lessons from this disaster, you can be in a position to ensure that any disasters that come your way won’t have the same effect.  If you’re well prepared, having invested in your business, have the right culture, and you manage your business and be a good leader, you will be able to come out the other side in good shape – unlike the State of Victoria.