We hear the world will never be the same after Covid-19. But what does that really mean for businesses?
An insightful article — published by Linkedin and written by Neal Kissel at Charles Rivers Associates — gets to the heart of it. The article is called “Five Lasting Changes CEOs Need to Be Planning For Now.” Although it says “CEOs,” it’s “big picture” stuff useful at the ground floor at smaller communities.
Here are the five areas that will be here to stay if not accelerated by the pandemic:
1. Remote working. We’ve seen it already happening; Covid-19 will just speed the adjustment. “The need for corporate office space may become less acute,” the article says. “Companies may move to a variant of the ‘flagship store plus digital’ retail model – with a small central office space… .”
2. On-line retailing. It may have reached a “tipping point,” the author says. “The crisis forces everyone to transact online and, in many cases, directly with suppliers. … “This has profound implications for businesses that relied on face to face interactions like insurance brokers, and bricks and mortar retailers.
3. “Cocconing.” It will live beyond this health crisis, with “a significant increase in time at home, a reduction of journeys of any kind, a re-rooting of consumers to their local community (emphasis mine)…, and, finally, an understanding that many basic needs for goods and even services can be met online.”
4. The supply chain. This crisis will may bring supply chains closer to home in the long-term, and that may mean business opportunities closer to home. “It is likely that this crisis will bring a re-consideration of the efficiency vs. control and predictability… with many businesses looking to bring supply chains closer to home regardless of short-term hit to efficiency that the loss of lower-cost international suppliers might imply.”
5. Risk management. It will cause a re-examination of objectives and strategy. In part, “the virus has brought into focus just how long-term, notionally abstract risks — e.g., Disasters, Diseases, Climate, Employee Discrimination, etc. — can threaten the very existence of businesses in a very short time-frame, once they materialize. Investors concerned with risk management will have this in mind when they grill companies about their plans in the future.”
A link to the full article is HERE.