The current global pandemic is disrupting business like no event for at least 75 years, possibly ever. The COVID-19 crisis is changing business models that have been established, in some cases, for decades.
Restaurants are adapting to providing take away food, schools are being forced into online education, businesses are equipping their people for home working and industries where selling has always taken place face to face are gearing up to find new ways to personalize business online.
Accentuating the positive
The single positive about this global crisis is that it has happened now, at a time when the world has never been better connected. There are 3.2 billion smartphone users worldwide, a little short of 50% of the global population, but significantly higher than a decade ago. A combination of faster internet connections and better mobile networks have left many people far better able to cope with lockdowns than they would have been a decade ago when online was less mature.
Changing behaviors to digital
The circumstances of COVID-19 have forced many businesses to pivot to a new digital reality much more quickly than they might have planned. Healthcare professionals have been able to conduct telephone and video-based consultations for some time, but custom and habit has continued to make the experience face to face, despite the obvious risks of ill patients sitting in a waiting room with other ill patients. It has taken the virus to force a change of habits that will likely continue. Tesco has achieved a growth of 100 percent in online deliveries in a matter of weeks-rather than the planned years. It is now offering one million online delivery slots per week in the UK.
Recent research by Workhuman demonstrated that only one third of US employees worked from home before the pandemic. This is also behavior that is likely to change in the future with the realization by companies that they can be efficient and effective with fewer premises, most likely prompting a rethink of the ‘office’ environment as the most suitable way to do business.
There is clear evidence from similar (but less severe and global) incidents that once the crisis is over, the behaviors do not necessarily change. McKinsey, for example, believes that the explosion of Chinese e-commerce was a direct consequence of the severe acute respiratory syndrome (SARS ) epidemic of 2003.
The ‘new normal’-whenever it emerges-will feature aspects of life from both pre and post the pandemic and is likely to be far more dependent on online services.
Digital transformation - A journey
Of course, many companies - including some of the most successful businesses in the world today - had already made big bets on digital before the outbreak of the virus. These tended to be companies determined to challenge acceptance of the traditional business model:
- Amazon in retail
- Uber in transportation
- Airbnb in accommodation
- Netflix in broadcasting
These pioneering companies were using data collection and analytics to identify and generate new business opportunities by deliberately challenging the perceived status quo. More recently, the same businesses have pioneered the application of artificial intelligence, developing algorithms that analyse big data to deliver personalized experiences on a scale never seen before. They are leading the journey along a digital transformation trajectory and evolving their business models to keep pace with an environment when the only constant is change.
The current crisis has forced millions of less digitally native companies to challenge their own status quo, from the restaurant chains that have quickly moved to offer home delivery services, to real estate agents that have deployed 3D imagery to disrupt the process by which people buy property. These businesses are now embarking on their own journey of transformation, through necessity, rather than choice.
Thriving in chaos - The role of data
It stands to reason that the businesses that made the best use of digital tools and services before the virus will be in the primary position to benefit when the crisis subsides. Companies need to be able to identify and analyse the shape of the new reality and data is the tool that enables them to do so. By leveraging both internal and third-party data, organizations can:
- Uncover the context surrounding customer trends to inform sales and marketing strategies.
- Use alternative data from news and business sources to power predictive analytics that can inform buy/sell decisions.
- Support academic research with bulk data for training machine learning algorithms.
- Integrate critical PEPS, sanctions and watch list data into risk management applications to enhance compliance programmes.
And, ultimately, data-driven organisations can capture pole position as they rebound when a new version of normality returns to the business world.