Opinion | It isn’t just business tools that will shift but our mindsets too3 min read . Updated: 16 Apr 2020, 09:40 PM IST
Entire business models may need to be reworked as customer behaviour shifts in response to covid
One positive side-effect of the covid-19 pandemic has been the emergence of black humour, reflecting the unique human ability and survival instinct of laughing in dark times. A cartoon frequently forwarded to me depicts a multiple choice question: “What led to the digital transformation in your company? A. The CEO B. The CTO C. The CDO D. COVID19". The answer tick-marked is D, of course.
Digital transformation is one of those things that every chief executive officer (CEO) wants to carry out, but never gets around to doing in earnest. Right now, as companies reel from the covid impact, there is a lot of pessimism around getting back to business, revenues, job losses, etc. Investing in anything new, even going digital, seems far from their priorities. However, post-covid, digital transformation will become an even greater priority for the managements of companies across sectors and geographies. CEOs know that they will be entering a very different world, and a transformation in their businesses will be needed to adapt to it. Here are four reasons why digital transformation will accelerate post-covid:
One, saving costs and becoming less human-dependent: Cost-saving through digitization will be the top priority. Digitization of processes through robotic process automation, collaboration tools like Zoom and Microsoft Teams, automation via the Internet of Things and other technologies will not be optional any longer. This will help companies share costs and increase collaboration as well as productivity. They will also invest to reduce human-dependence to the extent they can, since humans-in-the-loop could become a point of failure, unaffordable in bad times. This will have the unfortunate effect of extending job losses, but it now seems inevitable.
Two, the hunt for business resilience: Prepare for the adoption of new business models that bank on digital transformation. Companies whose models are purely online (like Zoom, Byjus, tech/software as a service companies) are seeing a boom during this disruption. Companies whose models are enabled digitally, such as those engaged in e-commerce, have been disrupted, but their decentralized, tech-enabled supply chains will recover faster than others; think of Zomato and restaurant delivery, rather than restaurants themselves. Most traditional companies will, therefore, have to review what aspects of their models can go digital, or whether an entirely different business model can work; the out-patient-departments of hospitals moving largely online, for example. This O2O, or offline-to-online, transformation will suddenly become mission critical.
Three, changes in customer behaviour: Experts claim that it takes 66 days to break or form a habit. A lot of new habits will form over this lockdown period. Say, reading newspapers online, not going to restaurants, working from home, wearing informal clothes, always wearing masks, etc. Consumption patterns will change, often quite radically. People might not like to crowd stores, their attitudes to public transport will alter, and even their leisure travel might get impacted. Thus, apps may emerge to enable curb-side pickups, book grocery pick-up time slots, and enable socially-distanced journeys. As business models and processes get reworked to adapt to these new patterns, digital tools will be adopted to cater to customers in need of new consumption experiences.
Four, changes in management cultures and dispositions: Here again, the mindsets and corporate cultures will likely be influenced by the need to use digital technology. Human beings, especially those in senior management, tend to resist change. This crisis will force them to be more receptive to new ideas, and listen more closely to customers and employees. Many CEOs I know would never have countenanced working from home, but are realizing its benefits now. The covid crisis has opened their minds to new tools.
The correct answer to the multiple-choice question posed at the beginning is none of the choices given, not even the disease that has shaken up the world. The correct answer is E. The Customer.
Covid-19 is a transformative event that will radically change the minds, needs and demands of customers across the world. Every future-ready company will probably be in a race to meet their demands by redoing its business model, customer experience and work culture by deploying an array of digital technologies. This has profound implications to the world of business in accelerating a transformation that was underway.
Jaspreet Bindra is the author of ‘The Tech Whisperer’, and co-founder of Unqbe