With much of the world gradually lifting COVID-19 lockdown restrictions by end of this year, the question remains whether businesses are ready to face the long-term challenges that seem inevitable to manage the pandemic. Uncertainty about the virus has led policymakers everywhere to take a cautious approach to reopening their respective economies.
It is time to adjust to a new normal that will safeguard the interests of the corporate sector and support the vulnerable sections of society. Since experts believe the pandemic is likely to last for two years, the world is gradually learning to recalibrate to a new way of life and work.
That said, the grim reality points to further waves of COVID-19 infections that could potentially derail the already ravaged US economy. According to the Fitch Ratings, the Indian economy will shrink by five per cent in FY21 as a result of the extended lockdown. Further, Japan, the world’s third-largest economy, is facing its worst post-war slump and its first-quarter GDP shrank by 2.2 per cent.
But the global financial meltdown has also been a watershed moment for businesses and governments alike. It has compelled leaders to rethink priorities and seize new opportunities to get the economy back on its feet.
As lockdown restrictions ease around the world, significant trends are emerging that will determine how the pandemic will permanently transform the future of several industries.
Reimagine Supply Chains
Undoubtedly, COVID-19 has put to the test the fragility of existing supply chains and accelerated the need to optimise them to prepare them for potential future economic shocks. In my view, the face of manufacturing will drastically change in the long run as it will become a more diversified network to reduce dependency on one country or a single production hub. Supply chain shocks had led business leaders to identify other countries that are an alternative to China.
For instance, Facebook’s $5.7 billion investment in Reliance Jio has been widely viewed as a sign of India emerging as an attractive manufacturing destination, a crucial supply partner for western economies.
As businesses adapt their strategies to cope with roadblocks, factory closures and restricted movement, a digitised supply chain is expected to emerge as one of the lasting impacts of the pandemic.
Deutsche Post DHL Group, the German contract logistics provider, has announced investing in digitisation to support customers seeking more flexibility in the supply chain. The company’s initiatives include deploying 1,000 new robots, which will replace manual labour throughout its supply chain network and introducing electric and autonomous vehicles, anticipating a driver shortage in 2021.
Usher in a new energy order
According to a recent report, the pandemic has created an unprecedented situation where the global demand for oil could drop by an average of nine per cent this year.
Indeed, the plummeting price of oil and gas is one of the major shockwaves experienced by the global economy.
In my view, since oil and gas are critical enablers of prosperity, a new energy order that supports the sustainability agenda is vital to accelerating the recovery process led by energy companies. The time is ripe to reboot the system and introduce initiatives that will lead to a more stable global economy that thrives on renewable energy solutions. Boosting domestic production of low-cost solar photovoltaic (PV) modules and cells, and raw wind material and components is one such initiative that will lead the way.
Thus, the pandemic has triggered the unprecedented collaboration between the Organization of the Petroleum Exporting Countries (OPEC) and the G20 to cushion the oil price shock in an equitable way.
A new energy regulation body is vital to ensuring the long-term stability in energy markets and prepare them to handle future catastrophes.
Change the face of consumer behaviour
One of the biggest shifts is the emergence of a new ‘normal’ where global organisations will help consumers to adjust to a new lifestyle. Enforced stay-at-home government mandates and social distancing have ushered in unprecedented changes in consumer behaviour that will continue beyond the lockdown.
Retailers are now compelled to lead innovation through omnichannel competencies as online shopping experiences are replacing physical shopping in brick-and-mortar stores.
Refreshingly, the pandemic has seen the fuelling of innovation driven more by consumer demand and less by the bottom line. For example, alcohol beverage companies are manufacturing hand sanitisers to follow hygiene guidelines to combat the pandemic.
If organisations seek to thrive and not just survive in the aftermath of the pandemic, they should reimagine customer experience to explore new revenue streams and reinvigorate their businesses. For instance, brands are offering niche shopping experiences to stay engaged with consumers. For example, Amazon Go that was launched in 2018 is a fine example of frictionless retail, heavily dependent on a complex system of cameras and sensors.
OTT platforms and at-home digital media are catering to consumers’ “home-bound” entertainment needs. . Virtual live events that bring outdoor events to the consumers’ screen will be the futuristic innovations that will leverage digitised technology, like never before.
Improve Learning outcomes through technology
Due to the pandemic, schools have been closed in 146 countries, affecting at least two-thirds of the global student population. It is an unprecedented opportunity for EdTech companies to break the mould and offer students an experiential learning-based education. The trend is expected to continue long after the lockdown ends.
The world over, the adoption of smart classrooms has ensured the continuity of learning outcomes for students. A remote learning environment aided by Artificial Intelligence (AI) and other learning analytics techniques will co-exist alongside the traditional notions of learning. Chatbots, voice recognition software, virtual, augmented, and mixed reality will drive the future of education.
Adapt to the work-from-home model
The pandemic has fundamentally changed the way people work and live. It has compelled organisations to allow employees to work from home and support them by providing them with the necessary technology, skills, and tools to improve and monitor their productivity. The work-from-home model is here to stay, even after the lockdown lifts. Overnight, the pandemic has made organisations adapt to a virtual realm wherein team members use collaborative tools for creative problem-solving and online meetings.
For those who need to report to work, companies have been on an overdrive to build contactless technologies that rely on sensors and facial recognition tools to ensure that social distancing norms are followed. For example, Cushman & Wakefield has installed beacons in their office premises to track employees’ movements via their mobile phones, sending alerts when six-feet rules are breached.
Employers are also using surveillance tools such as DesTrack and WorkAnalytics monitor workers’ productivity.
On the flip side, the pandemic has seen the emergence of a more agile and engaged global workforce.
From rebound to recovery
The foundation for post-COVID growth can be built only if we do not return to the ‘old normal’ that has brought us here. The pandemic has served as a wake-up call for business leaders to stabilise amid a crisis and explore risks and opportunities to find a path towards growth and prosperity. Businesses should continue to actively engage with customers, leverage technologies to scale unparalleled heights of innovation and build adaptive and agile organisations that will be resilient in the face of future catastrophes.
Fortunately, the pandemic put the spotlight on innovation, which will drive the road to recovery. I urge business leaders to prioritise innovation by seizing new opportunities emerging from the crisis. The ecosystem should also foster a renewed culture of entrepreneurship as fresh ideas and solutions will pave the way for a new post-pandemic era that fuels India’s growth engine.
Despite the second wave of the pandemic that has gripped over fourty nations, notably India, it is my belief that robust optimism will take the world forward in the scenario that unfolds hereon. In the past one year, economies have been rebooted, the environment has been rejuvenated and people are getting vaccinated. We must not lose this momentum and strive to not just bounce back, but fully recover from the scarred legacy the pandemic will undoubtedly leave behind for both individuals and world economies.
~ Ravi Narayan, CEO, T-Hub
NOTE: The article was originally published in The Economic Times on 20 June 2021, titled The top 5 business trends to Look out for after lockdown.
