Leading through crisis: Creating opportunities from external pressures

On 14 September Future of London convened a roundtable of senior leaders from across London’s built environment sector at Montagu Evans – the second event in our Leading through Crisis series.

“The word ‘crisis’ is overused but it’s undoubtedly the right word to describe the current circumstances”, said Lord Bob Kerslake to kick off the discussion.

The pandemic, followed by the war in Ukraine, means that there are now multiple crises competing with one another for our attention, resources and solutions: wider inflation, rising energy prices and the risk of moving into recession. And all of this is unfolding against a backdrop of extraordinarily stretched public finances and a huge service backlog.

What should London’s leaders prioritise? Image courtesy of alevision.co on Unsplash.

So what should London’s leaders prioritise during this period? To discuss this question and reflect on the leadership skills and approaches needed to create opportunities in times of crisis, Future of London’s Chief Executive, Nicola Mathers, was joined by:

  • Lord Bob Kerslake, Chair, Be First
  • Matthew Carpen, Managing Director, Barking Riverside
  • Robert Evans, Joint Managing Partner, Related Argent
  • Fiona Fletcher-Smith, Group Chief Executive, L&Q
  • Joanna Parker, Principal Planning Officer, City of London Corporation
  • Cath Shaw, Deputy Chief Executive, LB Barnet
  • Mike Woolliscroft, Group Co-Chief Executive, Countryside Partnerships

The discussion focused on four key opportunities: innovation, collaboration, plugging the skills gap and changing the public perception of development.

Unfolding – and overlapping – crises

Lord Kerslake began by inviting us to reflect on the 2008 financial crisis and reminded us that London recovered faster than the rest of the country back then. So we mustn’t lose sight of the city’s ability to bounce back.

While attendees agreed that the 2008 financial crisis felt much more dramatic, there are fears that the impacts of the multiple crises we’re now experiencing will be much more pervasive and last for a lot longer. “This is a rolling crisis, impacting multiple levels of society over a sustained period, rather than a cataclysmic one,” said Fiona Fletcher-Smith.

And the rolling nature of these crises is taking its toll on staff resilience. The adrenaline rush of the early days of Covid-response is giving way to burnout. And the fact that huge numbers of people are leaving the workforce is putting extra pressure on those who stay.

There’s also a risk that being in constant crisis mode leaves little room for radical new thinking about how the built environment could be and how we as a sector could do things differently. Instead, traditional thinking prevails and schemes continue to come out of planning now that haven’t been adjusted to respond to the impacts of the pandemic, particularly with regards to office space.

“Redesigning the office to better enable and support hybrid working would have such a great impact on staff morale, cohesion and productivity.”

Matthew Carpen   

And while the pandemic response proved that the sector can make big decisions and implement them quickly, there was also a lot of government funding then that enabled the public sector to take risks. But the multi-layered and rolling nature of the current crises make it much harder for organisations to focus their energies and resources on just one or two issues as they did during the pandemic.

This is an opportunity to…innovate

Nevertheless, despite the challenging circumstances, attendees expressed a great deal of optimism about the good that could come of them – particularly with regards to creativity and the hope that we might find smarter ways of combining land, skills and money. “The real estate industry in incredibly bureaucratic, paper-based and so on – it deserves to be disrupted,” argued Robert Evans.

For Related Argent, one way of innovating has been to invest in PropTech funds to get better exposure to this entrepreneurial industry and see what the built environment sector could learn from it. It’s been both challenging and interesting, but it’s resulted in a culture change within the organisation and a desire among staff to innovate and experiment.

“Being innovative attracts better talent.”

Jo Parker

Several attendees felt that higher energy costs were spurring investment in renewables and a move away from a high-carbon economy. Local authority planners are having more and more conversations with developers about retrofitting existing buildings rather than building new developments, and sustainability is increasingly at the top of the sector’s agenda.

This is an opportunity to…collaborate

Lord Kerslake suggested that, while these various overlapping crises are ongoing, the sector can use this time to prepare the ground for the next economic upturn, so development schemes and projects can hit the ground running.

The best way of doing this is to form strong partnerships and get better at working collaboratively – whether that’s in the form of joint ventures or working with institutional investors. “To do this well it’s important to understand your partner’s priorities and how they are being affected by today’s crises,” added Mike Woolliscroft.

“There’s a tendency to respond to a crisis by shifting your focus internally, to your own organisation. Instead, we should be looking up and out.”

Cath Shaw

As budgets tighten, local authorities and housing associations should stop seeing each other as competitors and work on ways to share resources and tackle problems collaboratively. Organisations like the G15, London Councils and Future of London have an important role to play to facilitate this.

“At the moment we all work on our own schemes,” said Robert Evans. “But could we deliver more affordable housing and tackle the net zero challenge more robustly if we worked in a more aggregated way?”

This is an opportunity to…plug the skills gap

Staff retention is a big concern for the sector at the moment. Image courtesy of Jason Goodman on Unsplash.

With huge numbers of people withdrawing from the labour market and the inevitable ‘war’ for talent that this creates, we should be prioritising building capability for the future by revisiting and strengthening the relationships between employers and employees.

Lord Kerslake suggested that this is an opportunity for the sector to develop a ‘Five-point plan’ for the skills agenda and other attendees agreed that staff retention is a big concern at the moment. New employees are more focused on work/life balance and want to work for value- and purpose-driven organisations, so the development sector needs to be better at communicating the social impact it delivers.

It was also suggested that any new skills plan should be co-produced with staff, to not only address the specific gaps within, and needs of, particular organisations but also to gain insight into what current staff want and need in order to stay in the sector. And as outlined below, the skills needed to work with communities are now as important as traditional development skills. Leadership courses, like Future London Leaders and Leaders Plus, have adapted to these times of crisis by focusing on resilience.

“Maintaining personal resilience is vital but so is curiosity – about our partners, about innovation. How can we, as a sector, spark that?”

Fiona Fletcher-Smith

This is an opportunity to…change the public’s perception of development

There was broad agreement that the wider public perception of the development industry is fairly negative. The reputation of many developers has been tarnished and many members of the public don’t trust the private sector. Now is an opportunity to renew the sector’s social license.

How can we show we’re on the side of local people? Lord Kerslake stressed that there are many positive stories we can tell Londoners from the past ten years, particularly the amount of social housing that has been built. He suggested that housing associations and local authorities could start by asking people about their lived experience of development and the built environment.

Collaborating to build a London-wide framework to capture this data would give much better insight into how to build a positive narrative about development, helping the sector better understand what matters to people and put communities at the heart of developments going forward.

London’s leaders are now focusing on the next crises that might affect the sector, including blackouts. Image courtesy of Claudio Schwarz on Unsplash.

“The work we’ve been doing with the Young Foundation, the local community and peer researchers is one of the most important bits of research we’ve ever done to help understand what people want from development in their area,” added Matthew Carpen.

What are the next crises London’s leaders should prepare for?

Attendees explained that they’re preparing for a number of new crises in the short and medium term, including:

  • supply chain failure
  • industrial action
  • civil unrest
  • blackouts.

However, if London’s leaders respond to the current crises by pushing innovation, strengthening partnerships, building capacity and renewing the social license, the sector will become more resilient against future crises and, crucially, be in a better position to deliver for London in the long term.

As our discussion revealed, crises present an opportunity to rethink and re-evaluate the art of the possible, from partnerships to people’s expectations, and from appetites for risk and reward to smarter ways of working.

Thanks to Montagu Evans for hosting us. Please get in touch with Sophie Nellis if you’d like to know more about Leading through Crisis.