Rethink how you do business for organizational resilience and responsiveness
- Posted on May 19, 2020
- Estimated reading time 3 minutes
The scale and scope of the COVID-19 pandemic has shocked us all. In hindsight, it’s hard to believe that infectious diseases didn’t even make the World Economic Forum’s top 10 list of global risks in terms of likelihood for 2020. Yet, during the first half of this year, our workplaces and world have radically changed due to the COVID-19 virus. Instead of traveling several days a week to spend time with clients as I was previously, I have rarely left my Dusseldorf home over the past couple of months. While Germany is slowly starting to reopen, virtual has now become the default for how we live and work. As a result, issues of safety, privacy and ethics are front of mind for us all, and resilience, confidence and trust have become pivotal.
However, we can also see much cause for optimism – and opportunity. Recent months have proved we are able to learn and adapt fast when we break with convention. What we buy, how we live and the way we work have changed forever, and faster than we could have imagined. Accenture Research shows that almost half of people who never worked from home previously plan to do so more often in the future and that more than 35% of purchases will be taking place online by the end of the crisis, a five-fold increase. Meanwhile, experts predict the use of telehealth and telemedicine will continue to accelerate and become normalized post-crisis. Our habits are rapidly reshaping.
In its reflections on management during the current global disruption, the Center for Information Systems Research at MIT Sloan School of Management notes that we have “an opportunity to rethink how we do business … This will include transforming your company to have an even better customer experience and more efficient operations.” Business continuity will remain a key priority, but you also need to set your sights on the long term. Now is a chance for leaders to reflect critically on new ways to drive value and rethink how business is done.
Rethink to Respond, Reset, and Renew your business
Most organizations will pass through three phases as they recover from the impacts of the COVID-19 pandemic. Typically, organizations will be in Respond mode for the first three to six months, with an absolute focus on business continuity and getting back into control – enabling employees to work remotely and customers to continue to access goods and services from home, while maintaining core operations.
Already, we‘re seeing many of our clients move beyond this phase to adopt a Reset mindset. They’re using the current global disruption as an opportunity to reconfigure their operating models to be more modular and scalable, and to rapidly iterate their product portfolios in response to changing market demands.
Over the course of the coming 12 to 18 months, we expect organizations will increasingly shift their attention to how they can Renew and grow and position for the future. Business model innovation will be mobilized through experiments actively sponsored by the C-suite, while emerging technologies will help organizations drive increased efficiencies and differentiation in the market.
Throughout these three phases, we encourage our clients to focus on five priorities to rethink how they do business:
- Cost Containment and Optimization – Immediately reduce operational costs, moving to a scalable cost model and freeing up capital to accelerate growth opportunities.
- Talent Agility – Empower your employees to respond to external changes efficiently and nimbly, while evolving to an optimal balance of staff, third parties and automation.
- A Resilient Core – Protect the core operations of your business and build a resilient and scalable operation that is flexible for the future.
- Customer Care and Operations – Continue to be able to support the changing needs of your customers and create a capability to support new channels to market over time.
- Products and Services – Rapidly respond to changes that affect your product portfolio to minimize disruptions and anticipate how products and services will evolve in the near and longer term.
At Avanade, we’ve identified a list of factors to consider in these five areas at each stage of Respond, Reset and Renew. I invite you to read our disruption recovery guide for more details.
None of us have experienced anything like this current situation before. During previous disruptions, our intent has been to return to normal as soon as possible, but that can’t be our objective this time. What we know is that change is urgent and digital technologies are a tremendous accelerator. As Satya Nadella observed in Microsoft’s recent earnings call, “We’ve seen two years’ worth of digital transformation in two months.”
To rethink your business, you need to quickly identify strategic bets to make your operations more resilient and your products and services more desirable to customers. Think about how you can build on your remote working experience to create a truly elastic digital workplace. Or how you can rapidly scale your operating model with the cloud. Perhaps you need to optimize your customer care and operations to maximize revenue opportunities through this global disruption and beyond.
Regardless, you can be sure the path ahead won’t be linear, so you’ll need to activate the full capabilities of your organization – both digital and human – to unlock operational efficiencies and create new revenue streams in response to changing market dynamics. As you test and learn, make sure all investments are outcomes based and have a demonstrable business case. A clear vision and the agility to rapidly test, learn and adapt throughout this global disruption will separate the winners from the losers.
Learn how you can Respond, Reset and Renew your business for resilience and growth.