COVID-19 could change entire industry ecosystems—what makes planning challenging is that it is not clear how permanent and deep the changes will be.
By now you are deep in your business continuity planning (BCP)—if your organisation had planned it, good; if not, you have learnt its importance the hard way. The COVID-19 related disruption is such a seminal event in our generation that none of us are likely to forget the lessons from this pandemic. From now on, there will be few organisations to not have a BCP: building a BCP will prepare you for any such event which surprises you. What organisations now need is a Beyond COVID-19 Plan (BCP), which pools in the learning from this event to make the business go faster, higher and stronger.
The new BCP requires a look at both your internal resilience and external reality. Be brutal in assessing what has changed and how permanent the change is expected to be. The change will be in employees, their behaviours and expectations, the new realities of working, and in the understanding of which aspects of the business model are most resilient. Play out how the various economic scenarios could unfold taking your cash situation and customers’ realities in account.
Both the internal and external world could evolve dramatically in these uncertain times—the suddenness of the change can unnerve and challenge the best-laid plans. There is no alternative to agility. What makes planning challenging is that, it is not clear now is whether changes will be permanent or temporary.
Expand your horizons…
To build Beyond COVID-19 Plans, look across six horizons to rebuild business models. Draw deep lessons from the experiences lived by your organisation, its stakeholders, the industry, your community, and the national and global changes.
Sharply define what the business stands for. In uncertain times like these, it needs to be very clear in the minds of customers on why the business proposition is relevant in their lives. In the classic speak for strategy, are you offering your customer some differentiated offering or the lowest-cost one? In these circumstances, there is one more element: can your business be present with your customers as their needs and preferences evolve? Why should a customer pay for your offering in times when she is conserving liquidity? An ice-cream company may change to become a milk delivery company in these times of only essential goods—if this is what is needed to remain relevant with your ecosystem now, then so be it.
Be in touch with customers. Remember the lives of your customers have turned quite topsy-turvy, not dissimilar to your own. They do not have all the answers, but it is important to ask them the questions so that solutions can be co-created. Many schools are now experimenting with online classes. They may not work perfectly—they naturally miss out on the interactions that are so critical for learning and leadership-development—but they do keep the basic activity of imparting knowledge on. Depending on how long the lockdowns last, the habits of your customers can change permanently as the tools to address their needs get perfected.
Similar to your customers, keep a close eye on the new expectations of employees. They may be concerned and confused about their futures. Many of their roles will morph into something that would have been unrecognisable just a few weeks ago. They will need trainings to pick up on skills in a changed world. If the norm of social distancing will persist for a few more weeks (months?), and the deliverance of all problems will lie in going digital, your organisation and its employees will have to reskill and redefine their roles. If work from home becomes viable, the concept of offices themselves may change!
The biggest change could be in the nature of your industry. There will be new competitors as the definition and delivery of the offering changes. If most of your transactions are going to be digital, what do you need a physical outlet for? How do you engage your customer who earlier would come to your outlet for some interaction? Will new platforms emerge where your brand or offering is only one of the many that vies for attention? If your distribution channel begins to move away from highways to i-ways, how does that reconfigure your own supply-chain forward and backward?
The society itself will not remain unchanged. In battling COVID-19, many societies have given up on privacy in ways that were unimaginable. Drones are now patrolling dense areas, mobiles are tracking your location and linking them up with whether you were with a diseased person, and your health records could become an important determinant in your visa (or work!) applications. These changes in social norms towards privacy will change the analytics that your business may be able to do your customer. Will these patterns reverse once social distancing norms change? Or will the fear of the next epidemic make such data sharing a new normal?
Finally, national and global factors may fundamentally alter. Longer supply chains may give way to smaller ones, countries may become more concerned about ensuring that they are self-sufficient in certain goods and services, and the flow of goods and services may get impacted by sudden and large tariff changes across borders.
…but remain grounded in reality
None of these horizons are clear and nor do they have easy or obvious answers. The answers will continuously change and evolve as the situation changes. We still do not know how long the lockdown can last, with what intensity, and in which areas will it continue or keep recurring. Without even such basic clarity, it is difficult to forecast how the future will unfold.
The only way to thrive is to hang in there, accept the change and keep adapting. Just like in the old world, your Business Continuity Plan (BCP) document would give you some confidence of facing a crisis, playing with multiple iterations of your Beyond COVID-19 Plan (BCP) will better your chances so that you thrive when we walk into the new world, whenever it opens for business.
The author is Head, Strategy and New Initiatives, Axis Bank Views are personal.
Originally published in The Financial Express.