There is life after COVID-19 and the recession it created. It does not hurt to be optimistic even with infection numbers still on the rise. Just like other pandemics in history, the virulent coronavirus outbreak, too, shall pass.
The world now has more options to address critical concerns. Businesses have access to information and tools to do better in the face of health and economic crises. It makes more sense to come up with a post-pandemic strategy than to be merely reactive to the ravages of COVID-19.
Agility in responding to changes
Controlling the COVID-19 outbreak does not mean things will go back to the way they were before. The new normal is not coterminous with the pandemic. To drive the point, McKinsey has coined a new phrase: the next normal. It is a new set of realities that carry on the changes brought about by the coronavirus problem. The changes in customer behavior and the way companies do business will likely linger even after the virus scare eases.
Accenture conducted a study that backs this idea of lasting change. “Consumer attitudes, behaviors and purchasing habits are changing–and many of these new ways will remain post-pandemic,” writes a late April research report from the firm. The same report notes that consumers are turning to digital solutions to work, learn, and play. It also projects an increase in the virtual workforce as more people see the advantages of remote work arrangements.
More ecommerce, greater dependence on tech solutions, and greater adoption of remote work are three of the biggest changes that characterize the post-COVID19 world. They lay the ground for the kind of challenges and opportunities businesses will face in the new normal.
With all these developments, it is important for companies to adopt agile management approaches. “The journey to agility must start now,” Accenture asserts in a report about outmaneuvering COVID-19 uncertainty. Becoming agile, however, is not just about responding to immediate needs. It also entails the building of suitable competencies such as digital adeptness, data-driven strategies and solutions, and cloud-based operations.
Creating a resilient business model
Quy Huy, Professor of Strategic Management at INSEAD, authored an insightful study that presents ideas business owners will unlikely think in the first instance. Two points from Huy’s article stand out: targeting survivability and resilience and building a strong organizational immune system.
The extensively experienced corporate strategy expert suggests that resilience should be prioritized more than economic efficiency. This may contradict the common wisdom of ensuring efficient operations to minimize expenses and maximize profits. However, there are many instances when surviving matters more than becoming efficient. “To increase reliability, therefore, redundancy will trump efficiency with regard to critical resources,” the INSEAD professor wrote.
Also, Huy’s witty organizational immunity idea in relation to the viral pandemic is noteworthy. “Build a strong organizational immune system rather than maximize short-term profits,” he advised. It is easy to be tempted to explore promising business opportunities once the pandemic and recession problems subside. Prudent strategizing, however, calls for the buildup of consistent regular income streams before engaging in attractive but risky ventures.
Some companies are inherently resilient, which focuses on risk-free arbitrage in the digital asset markets. “The paramount benefit of using arbitrage as an investment strategy is that if deployed correctly, it is risk-free regardless of the market conditions,” says in a report by Prance Gold Holdings.
However, even companies founded on relatively risk-averse business models also need to evolve. While arbitraging is legal and legitimate, markets are trying to plug the inefficiencies responsible for arbitrage profits. Because of this, focuses on triangular or three-point arbitrage. According to the same report, “A triangular arbitrage strategy involves three trades, exchanging the initial digital currency for a second, the second for a third, and the third for the initial.” This strategy makes it possible to continue finding opportunities for arbitraging across different markets.
Mindfulness of the competition and industry landscape
Strategizing rarely succeeds without considering the competition and external factors that affect a business. Competitors will always try to outdo their rivals especially with the less-than-optimistic consumer sentiments after a pandemic. Ignoring their actions can lead to disastrous consequences.
Competitor analysis does not only help in coming up with strategies to fend off or defeat competing businesses. It can also yield ideas on developing better products, services, and marketing and sales campaigns. It is not about having an adversarial mindset but a way of keeping up with the trends and being responsive to changing industry landscapes.
Estelle Metayer, a strategy expert affiliated with McGill University, wrote some compelling points in a research published in the Ivey Business Journal. “Our careful analysis of more than 20 Canadian and European companies that successfully implemented a Competitive Intelligence program revealed certain best practices,” Metayer noted. These best practices include better strategic planning with competitive intelligence inputs, more informed recruitment, the prioritization of synthesis and analysis, and behavior modification aided by competitor analysis.
Moreover, it is necessary to keep an eye on regulations and geopolitics. Even in the freest economies, companies need to adhere to rules and policies that may change over time. Likewise, with the undeniable clout of globalization, it is virtually impossible for businesses to be isolated from disturbances in international affairs.
Strategies should factor in all external forces that can impact operations. If the risks for a particular plan are too high, it would be better to change plans. Alternative courses of action or contingencies may be formulated to have some flexibility in strategizing.
In developing a post-pandemic strategy, companies can benefit from the basic SWOT analysis. However, it helps to underline the need for more agile responses to changes, threats, and opportunities. Additionally, businesses can deal with challenges better by ensuring resilience and preparedness for whatever competitors and external forces present.
