In 1859, Charles Darwin’s ground-breaking text, On the Origin of Species, changed the very fabric of scientific knowledge and the way we perceive the natural world. Darwin revealed to the world that ‘it is not the strongest of species that survives, but rather, that which is most adaptable to change.’ A veil had been lifted and a new period of enlightenment began.
Never before, in our modern era, has a lesson from the past held more truth. Recovery from the global COVID-19 pandemic will require the building of businesses and societies that can thrive in the face of continuous change. The lessons businesses are learning during the pandemic are profound; the cost-effective supply chain model revealed its brittle nature, digital business transformation accelerated at lightning speed, innovative agile teams problem solved complex tasks, necessity illustrated what products are truly important, and the planet, in our absence, began to heal. We are living through a turbulent period in history, with climate change, political unrest, and COVID-19 challenging our perceptions of ‘normal’. However, we decide as to whether this can be another era of lifting the veil, of revealing important natural, political, social and business truths to enlighten and improve our ways of life, or, we can revert back to ‘normal’, business as usual, with no lessons learned.
I believe that the veil has been lifted. Today, I hope to give you a look through.
Innovation and Agile Leadership
The current crisis has ignited the spark of innovation often hampered by rigid, bureaucratic structures. The businesses that most aggressively adapted their ways of working have turned the crisis into an opportunity for innovation, solving important social problems. Dyson designed a new ventilator in ten days responding to UK hospital demand, Alibaba built an unmanned store providing essential items for citizens in Wuhan, and Irish spirit distillers are collaborating with the HSE producing alcohol sanitisers for frontline medical workers.
These innovative responses weren’t part of any business plan. Instead, small teams recognised an urgent need, shunned aside unimportant activities, broke rigid bureaucratic structures and adapted their standard operations. This social innovator transformation strengthened both their businesses and society. 47% more business ‘rising stars’ are viewed during periods of turbulence rather than stability, with 89% of ‘sinking ships’ capsizing (Bain, 2020). Agile leadership and innovation appear to be key determining factors in whether businesses sink or swim, while simultaneously brining value to profits and society.
Building Resilient Supply Chains: ‘Going Local’
The current pandemic has shown the fragility of global supply chains and the importance of good procurement practices. Market demands for cost competitiveness have put unsustainable pressure on supply chains. This became most evident in the personal protective equipment (PPE) global bottlenecks. The brittle, inflexible, and often obscure nature of these cost-effective supply chains has been laid bare, exposing the need for change.
A Thomas Reuters’ study, on the ‘Impact of COVID-19 on Global Supply Chains’, reveals that 63.5% of businesses foresee nationalism on the supply chain rising. This has important implications for producers and service providers who can avail of this opportunity by offering sustainable, local solutions to businesses who wish to shorten their supply chains. In turn, this will satisfy shifting consumer trends. Euromonitor’s ‘Proudly Local, Going Global’ 2020 megatrend sees consumers valuing home culture and products tailored to local tastes and preferences.
As an open economy, we should avail of our position within the Eurozone and build collaborative relationships with our local European neighbours. As we are an export and import dependant country, cooperative trade relationships within our Eurozone could prove mutually beneficial; export opportunities continue, with supply chains also shortening and strengthen.
Together, businesses and consumers can support local while also availing of the value that they desire. This ‘new buying normal’ can help boost local economies, assist small businesses and start-ups, and add value to the triple bottom line by supporting people, the planet and profits.
Technology: The Digital Transformation
COVID-19 has highlighted the importance of digital readiness, allowing businesses to continue operations. Digital technologies are playing a crucial role in keeping our businesses and societies functional and preventing the spread of the virus.
Remote work is redefining consumers daily routines and, as they adapt to life at home longer, drives trends towards ecommerce, home entertainment and new digital experiences. This creates strategic opportunity for businesses across products and services.
Ecommerce and digital marketing must be embraced by businesses if they are to answer to shifting consumer behaviours. L’Oréal responded successfully to the crisis by quickly moving its marketing spending online, seeing e-commerce sales rises of up to 400%. L’Oréal executive, Lumboria Rochet, explains that “we are setting ourselves up for a world where half of the business is e-commerce and 80% of consumer interactions will happen online…In e-commerce, we achieved in eight weeks what would have otherwise taken us three years to do.
B2B buyers are also embracing the digital transformation. Research shows that 70% of B2B buyers believe that virtual sales calls are as effective as in person calls for complex products, with ‘virtual experts’ being presented as new service offerings (Bain, 2020). Digital transformations will be key in building sustained competitive advantage.
Sustainability with Purpose
While researching for this article, I came across an interesting misinterpretation of the Chinese word for ‘crisis’. Many motivational speakers correctly translate the first character as ‘danger’. However, the second logograph does not mean ‘opportunity’, as many believe, instead it translates as ‘a point where things change’, with the derivative being ‘chance, good timing’.
The theme of change is again evident. Now, more than ever before, we have the chance, the good timing, to get things right and recover from this period of danger.
Since the financial crisis of 2008, we have added environmental (climate change, pollution, biodiversity destruction), social (inequality and injustice), and political (Brexit and Trump) crises to our list. We now face the current COVID-19 crisis which has brought us collectively to our knees. Evidently, something is not working. Managing Director of the IMF, Kristalina Georgieva, states that “the best memorial we can build for those who lost their lives to the pandemic is a better, greener, smarter, fairer world.” Realising how past inactions have deepened global inequalities, her proposed ‘Global Reset’, promising mass investment in people, education, society and the planet, again echoes the desire and need for change.
During the pandemic, as humanity halts, nature is healing. COVID-19 is triggering the largest ever annual fall in carbon emissions from burning fossil fuels, heading for an 8% global reduction. Crude oil is close to worthless. The waters of Venice, normally choked with diesel and petrol, are now clear and frequented with dolphins. Lions roam freely on African roads that usually teem with safari jeeps. People in India now see their neighbouring Himalayan mountains for the first time, as the cloak of air pollution lifts.
The call to action is clear. We must embrace this opportunity for a global reset and build a ‘new normal’ where we live in equilibrium with our natural planet.
For too long environmental responsibility has been transferred to the individual citizen and for too long greenwashing has tainted businesses CSR policies. COVID-19 has highlighted humanity’s fragility in the face of nature’s power. We cannot allow climate change to teach us another fatal lesson. The pandemic has also taught us that no one can prosper alone and that collaboration for the common good can be achieved. We must adopt a holistic approach to our businesses, the triple bottom line, and create social, environmental and economic value for all our stakeholders, including our planet.
What kind of business do you lead?
What kind of business do you work for?
What kind of business do you buy from?
Is this business promoting the type of ‘new normal’ you want in this world? Or are they inhibiting it?
The secret of change is not to focus all of your energy on fighting the old, but on building the new.
Together, we can build a stronger, fairer, safer, healthier, planet. Together, we can achieve anything.