2020 was the great accelerant to socio-economic change. It was a challenging, disruptive, and unique year that dramatically changed how people live, work, shop, travel, and relate to each other. As the full impact of these changes become more apparent, businesses will need to play “catch up” so that they can be ready to hit the ground running when the economy starts to normalize. While a few companies may be able to survive and thrive with simple tweaks, the majority will need to undergo some level of business transformation if they hope to return to sustained growth and profitability.
A recent (December 2020) Deloitte survey of 3,600 executives in 96 countries found that 61% are focusing on transforming the workplace (double pre-pandemic levels). While workplace transformation is important, now is also the time to take a hard look at the changes needed for other key business activities, including what you sell (products), how you sell (sales and marketing), and what your supply chain looks like.
Every major change we’ve seen in the past year has generated a cascading flow of both positive and negative influences on the marketplace. A few examples:
COVID has restricted or stopped indoor public gatherings
- Outdoor activities (hiking, fishing, biking, etc.) participation/spending has exploded
- Music, movie, restaurant, and gym/salon businesses have been ravaged
COVID has closed offices and now millions work-from-home (WFH)
- Traffic jams have disappeared, gasoline sales are down, and air pollution levels are lower
- Athletic/casual apparel (sweats) sales have spiked while business casual sales have tanked
COVID has had a devastating impact on air travel
- Driving is perceived as the safer mode of transportation for traveling longer distances
- Business travel has been replaced by video conferences
Historically high unemployment levels
- Millions of people are in a state of financial hardship and have been struggling to pay rent and put food on the table
- Those that are employed have fewer spending options due to the impact of the pandemic (e.g. travel, restaurants, entertainment) and instead are saving money or moving forward with major expenditures such as new homes, home improvement, and new cars
This list goes on, but you get the idea – 2020 was tough for many people and businesses, and yet for some it was a banner year (I’m looking at you Amazon). What’s consistent across the board is that adapting to change was critical for businesses to either survive or thrive.
Like with most things in life, change creates opportunity. Today people want products and services that fill the needs of living in our new reality. Businesses can capitalize on these shifts in preferences through innovation, evolution, and diversification. But to take full advantage, cross-functional action needs to be taken across a company’s entire ecosystem. This pushes management, staff, vendors, suppliers, and more to collaborate in support of delivering what consumers are looking for.
I’m optimistic that we’ll eventually get “back to normal” but also believe that some things will differ from the pre-pandemic world. Mask wearing is here to stay for those with compromised health conditions. Air travel will be a different form of difficult, but with fewer fees. Restaurants, concerts, movies, and sporting events will be back in our lives, but with more options to experience them in the great outdoors. That said, I’m also quite certain that as businesses move down the path to recovery, new and unforeseen challenges will arise.
Successfully navigating through these rapidly shifting and uncertain times will require savvy, experience, and a strong dose of entrepreneurship and change management. Those companies that embrace and engage in business transformation will be best positioned to take advantage of new opportunities that will help to drive strong and sustainable future growth.