In August 2019, some 54 percent of executives predicted that digital would have a significant impact on their industry over the next five years[i]. We would assume that a similar survey today would reveal a significantly higher percentage. Work from home, a consumer-centric proposition, digital supply chains and other facets of digital transformation have fast become necessary to transact business.
SMLThe benefits of digital workplaces are fast becoming realised. Those that have been able to establish cultures and operations that can seamlessly cope with loss of co-location, and of data architectures able to scale seamlessly have an operational advantage in the immediate future. Likewise, those that have managed to partner widely, collaborate and enter new markets generally have a greater opportunity to climb out of the depression that COVID-19 could leave behind – whether through access to talent or by using technology to switch business models[ii].
Digital already prompts a greater number of multidisciplinary and cross-sector partnerships – a situation likely to accelerate as manufacturers switch markets overnight, services tap external expertise and government becomes enmeshed in everything. Smash-up businesses and sectors will ensue[iii]. Indeed, the issues of collaboration and colliding markets are likely to rise in importance the longer the COVID-19 pandemic and aftermath last. Bain, for example, suggests that to survive many CEOs will need to explore ‘...public-private partnerships wherever applicable. Companies' best partner in recovery may be a local municipality, mayor, governor, a regional committee, or a country’s governing body[iv].'
There is also an emerging expectation that the extraordinary impositions of the pandemic could lead to more automation. The more companies and sectors that digitise, the less of a competitive/comparative advantage it becomes. it propels us into the post digital era. With labour being an increasingly ‘unreliable’ input into the supply chain, there is a clear incentive for a range of industries to increase the pace of automation. The solutions organisations implement during crises often endure, recession-launched services and products often become market leaders while behaviour shifts can be permanent[v]. Economic resilience in the face of COVID-19 and other wildcards requires companies to do things differently[vi] and to do different things.
Manufacturers such as Vauxhall and Airbus are planning to repurpose their factories and utilise 3D printing technology to create parts for ventilators to treat coronavirus patients[vii]. Capabilities to adapt to new technologies and skills, ingest new ideas and craft new revenue streams are key, replacing history, tradition and in some cases previous expertise. COVID-19 has accelerated the pace of digital change, in many cases irrevocably. The window of change for incumbents would seem smaller than ever.