The business landscape today has been radically altered for better or worse. In 2020, many companies experienced a 20 to 60 percent loss in revenue and an estimated 12.2 crore lost their jobs due to the pandemic in India. As India struggles to cope with the second wave, businesses are in a race to adapt to extraordinary circumstances or perish.
With new vaccines emerging and a glimmer of hope at the end of the tunnel, let’s find out how your business can unlock avenues for productivity and growth going forward, based on insights from Forbes. These trends and factors may play a crucial role in ensuring business continuity.
Business Model Innovation
In 2021, customer behaviour and how businesses interact with customers has changed. This has had a significant on business operations and the underlying business models. Industries like hospitality and events underwent a drastic transformation in 2020: A digital first approach became necessary for many industries. Even those industries were not completely customer-centric had to change their processes to make their services and products more accessible and friendly. The organizations who were quick to adapt and make changes survived and even thrived. For instance, restaurants who quickly adapted to an e-commerce driven home delivery model were better off than those that did not.
Many companies were forced to adopt a hybrid cloud model to accommodate remote working environments in the new normal. Businesses today must constantly be on their toes about market changes and disruptions. Innovation has become the key for long-term business survival as a crisis may have many hidden opportunities. Businesses may have to re-build trust on new mediums and platforms while focussing on offering a delightful customer experience.
Decentralized Finance
Capital markets are in terrible shape in the wake of the pandemic. Businesses who want to raise capital via conventional means find themselves in a quandary. However, crowdfunding, blockchain technology, and decentralized finance provide some interesting options. The decentralized finance sector has strong potential in 2021 but it still has many challenges and there is still a need to build trust with businesses that have a more conventional mindset.
Pent-up demand
The period of lockdowns across countries led to a vicious circle. As businesses shut shop, consumer demand was hit, and many suffered job losses. The mandate for social distancing meant that conventional retail outlets, real estate, transport, tourism, and hospitality experienced a collapse.
Post the lockdowns there was still a looming sense of uncertainty but in regions unaffected by the second wave, the pent-up demand made up for the lost business and revenue. However, the overall trend is one of uncertainty and people are exercising caution with their expenditure.
Digitally enabled productivity
In terms of technological adoption, it is almost like we have travelled in time. With the rapid uptake of various industry 4.0 technologies, the world will never be the same again. Organizations today have addressed supply chain bottlenecks, enhanced data security, and deployed cutting technologies like automation and IoT in their operations. 2021 will be a clear differentiator for organizations who have leveraged these technologies. According to Mordor Intelligence, the industry 4.0 market was valued at USD 86.03 billion in 2020 and is estimated to reach USD 267.01 billion by 2026 while growing at a CAGR of 20.71% for the forecast period of 2021-2026.
The impact of these technologies on revenues and productivity shall only be known once data is available for the next few quarters. In the past, it has taken at least a decade for cutting edge technologies to become productivity. However, this is happening at an expedited pace in the new normal.A McKinsey survey published in October 2020 found that more customer interactions were happening digitally and the increase in online interactions was by as much as 3 times.
Final thoughts
Many businesses have reached an inflection point with the onset of the pandemic. The learnings and need for resilience and agility are expected to remain even post the pandemic. The focus will be on digitally enabled technologies and omni-channel communications. Businesses will have to leverage AI and automation to achieve a sustainable turnover in the long-run, while optimizing business operations and maintaining lead times.
