How to survive the pandemic and set up for growth

by Ian Richards

by Gabrielle Lukes-Mooney

The impact of COVID-19 is frighteningly real – over 180 countries have been affected to date, with many following a similar trajectory of approximately doubling cases every five days. If containment measures are not adhered to, the exponential growth of infections will rapidly overwhelm any health system’s capacity to cope.

In response, governments around the world have instigated widescale shutdowns with the aim of flattening the curve. The healthcare implications are momentous, and the economic consequences may be just as far reaching and enduring. The latest statistics are stark. OECD has downgraded GDP growth forecasts for all major economies, while global stock markets are experiencing significant adjustments only seen during the 2000 tech-wreck, and the 1930’s depression. In response, central banks in almost 200 countries have cut interest rates and implemented a range of economic stimulus measures including tax credits and investments to avoid the worst of a downturn. Although immediate prospects are bleak, by all accounts the massive weight of fiscal and monetary stimulus being injected into the system will mean the rebound will come quickly and with purpose.
 
Most businesses have now acted on the immediate challenges COVID-19 has presented. However, longer-term survival and prospects will be determined in the coming weeks and months. There are three stages of activity that each business should tackle to anticipate the market downturn and bounce back. Organisations need to respond; keep employees safe and the business running, reconfigure; survive the downturn and position the business for the rebound; where enterprises look to accelerate growth.

Underpinning each of these, a strong focus on people and change leadership is needed. We have all been thrown into a level of ambiguity not witnessed before – it’s critical for leaders to ensure that their people are equipped with the tools and behaviours required to succeed in these times.

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COVID-19 will be felt differently by each business based on their industry and relative level of omni-channel maturity. We’ve identified four strategic approaches you can take depending on the situations faced by individual businesses or divisions:
 
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1. Defend and Diversify: Sectors such as Hospitality, Travel and Tourism have been brutally impacted. Travel and tourism are at a standstill with the vast majority of airlines grounding planes; hotel bookings cancelled for the foreseeable future and full refunds being actioned across the board. In the hospitality sector, a large number of bars and restaurants have closed doors completely. To amplify the challenge, many businesses in these industries do not have mature digital business models to fall back on. 

Organisations in this quadrant need to take action now to right-size operations so they can maintain cashflow and ride out the current peril. The imperative is to get some immediate cost reductions while maintaining the capability to grow. At the same time, omni-channel maturity needs to be fast-actioned and wherever possible alternate revenue streams not as significantly impacted must be leveraged.

2. Disrupt Selectively: Sectors such as Retail Banking and traditional Retail are being hit-hard and will continue to face challenges through the imminent economic downturn. Some have reacted by standing down staff and minimising their physical footprint. While ongoing cost disciplines will be critical, the greater opportunity for these organisations is to take advantage of the differentiated capabilities they do possess. 

Organisations in this quadrant often have a good understanding of their customers and engage them via a mature and proven omni-channel ecosystem. While they need to defend the business against the immediate economic threats (such as the expected spike in loan impairment), they should be thinking now about the strategic repositioning beyond. Anticipation of where their customer is moving is essential and they should leverage this crisis to fast-track the organisational changes required to evolve to a digital-first model.

3. Fast-track Omni-Channel Capabilities: Sectors such as Logistics, Health Sciences and Telecommunications have an unparalleled opportunity in this crisis – having experienced comparatively low levels of disruption and in some cases, increased demand for services.  The challenge for these organisations is that they are starting with a relatively low base of digital maturity. 

While organisations have moved quickly in a tactical sense (for example Education institutions moving to online learning), they need to fast-track the enduring build out of customer insight, demand generation and omni-channel engagement. Reinforcing the human dimension of the change is important as well, to ensure the short-term momentum from the crisis is translated into ongoing transformation.

4. Accelerate Growth Plans: Finally, sectors such as Grocery, Pharmacy and pure play Digital operators such as e-commerce businesses are experiencing a phenomenal time in the sun. They should look to move quickly to capture the opportunity and accelerate growth plans. 

In order to capitalise on the head-start and sustainably maximise this opportunity, organisations should be hyper-tuned to emerging customer preferences and proactively evolve. At the same time, they can redirect some of the financial windfall into innovating their channel experience.

As enterprises raise their focus from immediate crisis response and start to think about the reconfiguration required to survive the imminent downturn – enduring success will be had by those who simultaneously plan for growth beyond. Over the next few weeks, we will be diving deeper into each of the above strategic approaches to support you in setting up for success once the dust settles.

For deeper insights into how to pivot your organisation around the customer, download our whitepaper now: