The IMF has said that the economic impact of COVID-19 is unlike anything we have seen since the great depression of the 1930s. The International Labour Organization has predicted a loss of around 195 million jobs worldwide, while the National Bureau of Economic Research reported that by May 2020, more than 100,000 small businesses had already permanently shut in the US.
In the midst of this chaos, what’s gratifying is that many organizations in the healthcare, IT, consulting and logistics industries have reacted reasonably well. They have reimagined their business strategies, processes, tooling, security, business continuity plans and remote working approaches. Their strategic advantage was Business Agility that allowed them to pivot as quickly as needed.
In this two-part series, part 1 mentions three focus areas that organizations will need to invest in, when building business agility. It also takes a deep dive into the first focus area; customer centricity. Part 2 of the article explores the remaining two focus areas; business continuity and employee engagement.
Business agility in action
Agility helps businesses respond quickly to opportunities and threats - internal like failing business operations and external like shifting trends or competitive markets. Authentic business agility involves the organization’s delivery and operations teams, and supporting functions like marketing, legal, HR, infrastructure and security.
Let’s look at a few examples of agile organizations responding in innovative and relevant ways to the ongoing uncertainties -
Unexpected business alliances are being formed. Dominos in India has a vast delivery network and has partnered with a major grocery company to deliver essential products.
Online retailers like Amazon and Flipkart whose delivery networks were halted, began producing and curating online entertainment content for their customers.
Many financial institutions’ back-end offices implemented remote working by relaxing some of the more severe regulations.
Hospitals like Apollo and Fortis ramped up digital initiatives and readied their practitioners and specialists for remote consultations.
People policies, especially those relating to mental and physical health, have come under a lot more focus due to remote working. For instance, IBM’s CEO Arvind Krishna’s pledge demonstrates a lot of empathy towards employees working from home. There is a higher frequency of communication on revised policies and updates to medical coverage, leave etc.
Automobile manufacturers like Volkswagen are reusing available technology to produce ventilators to meet the high demand.
Solutions like the above were not part of these companies’ strategic growth or expansion plans. However, being flexible and responsive helped them continue providing their services through difficult times.
Business agility focuses on three areas
Business agility is the ability to re-organize, like a set of gears, to keep moving in ever changing business environments
Enterprises responding to the desperate call for greater agility can benefit by focusing efforts on three areas -
Customer centricity: Disruptive and successful business models, transformation initiatives and business strategies are usually centered on customers. Zappos’ CEO, Tony Hsieh famously said, “Customer service shouldn’t just be a department, it should be the entire company.” This ever relevant sentiment is that much more crucial during crisis times because it pushes agile businesses quickly pivot and create relevant products and services for their customers.
Business continuity: An event as unprecedented as COVID-19 throws conventional BCP plans, like what the travel industry might have had, out the window. Business models driven by innovation exhibit resilience and continue to provide services in uncertain and demanding market conditions.
Employee engagement: Employee-centric organizations are driven by empathy. They focus not only on skill development but physical and mental wellbeing too. This plays a significant role in nurturing and maintaining a workforce that consistently aligns to dynamic business goals.
A McKinsey study states, 25% to 63% of global consumers expect their household income will continue to fall over time because of COVID-19. More than 75% of consumers expect COVID-19 to impact their routines and finances for months ahead while 50% expect the impact to go on for more than a third of the year. EY’s Consumer Index shows 35% of consumers will stockpile, while 28% will cut down on expenses.
These studies are evidence of evolving consumption patterns which places both consumer habits and businesses’s responses in uncharted territory. Some businesses are responding with digital solutions while other are altering services to be free - to hold onto their hard-won customer base.
Let’s look at a few businesses’ agile responses through the ‘customer centricity’ lens:
To ensure a seamless transition to remote working, without hindering customer services, tech companies provided employees with requisite hardware, software, security applications and tools.
Many schools like my child’s school in Gurugram, India offered online classes to continue with stipulated curriculums.
Google offered its premium version of Hangouts for free.
Cisco’s Webex, video conferencing tool was free for a few weeks.
Customers’ safety concerns encouraged Migrant Coffee, a Melbourne café to accept phone orders and issue home delivery services. In India, Swiggy, Dunzo and FlipKart are amongst the most popular companies to also offer contact-free delivery to customers.
For those organizations still struggling to figure out next steps, here are a few ways businesses can better align with customers’ changing needs, behaviors and priorities -
Amplify digital listening: Depending on the type of business, options range from 1:1 tele or video conversations to mailing lists or online and social campaigns. Sifting through data from these channels to unlock even the smallest patterns could enrich digital channels with critical content and services for existing and new customers.
Rewire, now! This is no time for conventional multi-quarter budgeting and planning sessions. While strategic roadmaps for a Post-COVID market are necessary, the current prerogative is to rewire present resources and offerings to match immediate customer needs. These needs are identified through continuous market analysis of demand patterns that are regularly reviewed by internal response teams.
Connect with customers: Deepening the relationships with new and existing customers will matter, as we enter the recovery phase of COVID-19. Involving customers (including suppliers and partners) in efforts to fight the pandemic can help achieve this. Simply asking for customers' suggestions on ways to help affected people or showcasing the organization's efforts or asking customers to contribute to the cause can be impactful. These are examples of continuous engagement that will rally together, business’ customers, suppliers, vendors and partners during a hard time. In time, customers will look back at organizations that were proactive about creating such positive experiences and show their love.
Most disruptions and innovations are centered on the customer, whose behaviour and needs will dominate how the business evolves post the current crisis. Part 2 of this series will take a closer look at the two other focus areas when building agile businesses; business continuity and employee alignment.
Disclaimer: The statements and opinions expressed in this article are those of the author(s) and do not necessarily reflect the positions of Thoughtworks.