Post pandemic, in the ‘Next Normal’ business cycle, leaders face the challenges to energise their businesses and brands by winning stakeholders’ empathy and trust. Last year, a huge aberration had crept into stakeholder behaviour world over. That anomaly was the manifestation of fear, insecurity, and uncertainty due to loss of livelihood, income and most crucially, due to the fear for one’s life. As we pledge to march forward to progress, what should be the organisational priorities, strategic imperatives, corporate messaging, and communication metrics for enhancing an organisation’s reputation and, thereby the goodwill? What should an organisation be thinking and talking about?
I believe the following six aspects could define it:
1. Rethinking Social Contracts and Future of Work: During the pandemic, most organisations played an expanded role – primarily by protecting their people–first the employees, next shareholders and thereafter vendors and customers interchangeably. This strategy shift transformed long-held expectations about the roles of the institutions. Once the stress subsides, the organisations cannot return to their old ways of life prior to the occurrence of the pandemic. They need to rethink their way to engage with their people in the future. For example–will ‘Work from Home’ be continued with? Should there be flexi-hours? Should 9 to 5 be done away with? Is a brick-and-mortar office sacrosanct? Should we reduce business-related travel? Should Performance appraisal process change?
The crisis has propelled new technology across all aspects of our lives, from remote working to e-commerce and logistics. New working and transaction practices will probably become a permanent fixture of the next normal.
2. Resilience, Efficiency and ESG Interventions: With the easing of severe lockdown restrictions, businesses will need to figure out how to operate in new ways. In short, resiliency—the ability to absorb a shock, and to come out of it better than before. I believe that the lessons learnt from the pandemic are much more profound than the global meltdown of 2008.
What characterises a resilient organisation is the preparation before the crisis—by building a stronger balance sheet specifically – the ability to manage operating costs. How to pay employees with lesser revenue income. How not to get disrupted due to supply-chain gap. Companies are finding themselves vulnerable because they cannot get the components they need to produce their products. Earlier BCPs and Supply-Chains built on ‘just-in-time’ inventory are fast becoming redundant. Given the way pandemic has disrupted many businesses, distributed component sourcing has to be reconsidered and revenue loss cannot be adjusted by reducing employee cost.
Other key business structure weakness is in succession plans as leaders get sick and marginalised, deputies quickly need to be found across all aspects of operations. Organisations are learning the hard way that succession planning has to go much deeper than the C-suite.
The pressure to include environmental, social and governance (ESG) factors in valuing a business is likely to expand to incorporate resilience to outside shocks, such as pandemics. In sum, organisations need to rebalance their priorities, so that resiliency becomes just as important to their strategic efficiency as is cost.
3. The Contact-Free Economy: E-commerce has meaningfully and visibly eaten into the sales of the brick-and-mortar organisations, except possibly the neighbourhood ‘Kirana’ stores. What the coronavirus has done is to speed up a change in shopping habits. Early indications from our country are that the new customers and markets—specifically individuals aged 35 and over and residents of smaller, less prosperous cities—have shopped online in greater numbers.
Virtual education, telemedicine, virtual wellness and health and food delivery have adopted a new way of life very robustly. Though the vaccination programme has started yet patients and healthcare providers, both have reason to expand virtual interactions. It is becoming possible to imagine a world of business—from the factory floor to the individual consumer—in which we will minimize human contact. Though, for many in our country, especially in urban areas, getting back to being normal will include visiting shopping malls and restaurants again, as opposed to ordering through online food delivery; and the roadside kiosks typical in our country are not about to be replaced by cashless hyper stores very soon. Patients with complex needs will still want to see their doctors in person. And many kinds of manual jobs are not automatable. However, the fact also remains that preferences towards e-services by the customers making companies intently search for people with the aptitude to become data analysts, mobile web designers, and AI architects.
4. Changing Industry Structures, Consumer Behaviour: There are lasting changes to consumer attitudes toward physical distance, health, and privacy. For example, increased health awareness and a corresponding desire to live more healthily bringing in a lasting change to where, how, and what people eat. Or how they travel. For millennials and members of Generation Z, those born between 1980 and 2012, pandemic represented the biggest disruption they have ever faced. Their attitudes could change profoundly and in ways that are hard to predict. The tourism, travel, and hospitality sectors will disruption in their businesses subject to long-term changes in individual travel preferences. Concern over the possibility of other “black swan” events could change how consumers approach financial security—saving more and spending less.
There is a perception that during the pandemic, government and financial institutions including banks were culpable of being lax. Though they accepted hundreds and thousands of rupees in tax payments and investments from the citizens earlier but helped too little too less during the pandemic with tax breaks, subsidies, and deferred loan repayment. Citizens all over are asking a relevant question that if an organisation can have a bailout during the recession, why not individuals? There is a growing sense that shareholder value should not be the only corporate value. Investing in employees, supporting customers and communities, and dealing ethically with suppliers will become a new reality. The idea of the “triple bottom line”—profit, people and planet will become mainstream.
5. Mobilising Resources at Speed and Scale – Within weeks and months of the pandemic, several countries were forced to add tens of thousands of doctors and hospital beds. Several governments including ours had to invest in new tools to map transmission and infrastructure. Because these were missing. A lot of countries in Asia have upscale their abilities to mobilise resources in a crisis. How can organisations utilise these ready-made infrastructures for public health? How the corporate world can partner such efforts here on and continue with the impetus?
6. Moving from Globalisation to Localisation – The pandemic has exposed the risky dependence on a few vulnerable nodes globally. China, for example, accounted for about 50 to 60 per cent of global demand for basic materials such as copper, iron ore, metallurgical coal, nickel, and rear-earth metals. They also mass-produce low-end consumer products, control mass production of pharmaceutical APIs and critical computer components. Organisations need to restructure as production and sourcing should move closer to end-users and should be diverse. Else we are at the mercy of a few which pandemic has taught us not to be. Espouse localisation, the cost is not always the key factor.
Possibly, the view held by the celebrated economist Milton Friedman that, “The business of business is business” needs amendment and we need to communicate that.
Any thought?
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