The human toll of coronavirus and the mounting economic damage has forced thousands of company experiments in new ways of working and operating.
The lessons companies learned in the months after the outbreak were profound. Virtual, digital and automation initiatives, for both customer interactions and internal operations, accelerated at astonishing speed.
Supply chains ruptured, showing beyond doubt that companies have for too long sacrificed resilience for efficiency.
They cannot afford to go back to the old way of doing things, and the companies that adapt will turn this crisis to their advantage.
Recovery will not be a straight path, however.
Employees will head back to work on different timetables, shaping an asymmetric recovery for all companies with global footprints.
The pandemic will continue to test all of us, striking at the heart of communities and demanding that we be prepared for subsequent rounds of reinfection and containment.
Companies will advance where they can, retreat when they must, often simultaneously, then adapt and start again.
The lessons of the past few months are as valuable as they were painful.
Working from home became normal with every department cutting through any hurdle necessary.
Digital roadmaps once measured in years accelerated rapidly in days and quickly proved their worth.
Automation took on the work of some employees who were sent home and helped companies quickly respond to surges in demand.
Yet if history is any guide, fewer than 50% of these companies will achieve their automation performance goals.
As the recovery proceeds, long-term success will depend not on automating a list of tasks, but on redesigning the work and processes with an eye toward automation and digitalisation.
Resilience for a turbulent world
Many shared-services centres struggled to adapt when all of their employees were forced to work from home.
Some companies had operating models that allowed them to quickly train and redeploy idled employees, but many others floundered.
Well before this pandemic, supply chain leaders were beginning to see the limitations of cost-efficient but brittle supply chains in the face of increasingly frequent disruptions, including natural disasters, escalating trade barriers and demand shocks.
The scramble to reestablish supply chains during the pandemic further underscored the limitations of inflexible, opaque supply chains.
One of the clear lessons from the shocks associated with Covid-19 is that today’s supply chains are too complex and too inflexible, and that the future will demand both more visibility and traceability.
Resilience also requires using cloud-based supply chain applications and other tools that can share information with their networks of suppliers and partners.
During the Covid-19 crisis, many manufacturers demanded greater visibility into their supplier’s own supply chains—a practice worth continuing.
5G technology and blockchain offer leadership teams real-time visibility and allow them to calibrate supply and demand during normal times, as well as react to supply and demand shocks.
Resilience does not come without cost of course.
The need for simplicity
Faced with Covid-19, companies did whatever they had to do to keep up with spiking demand or the challenges of running plants and warehouses with fewer employees and fewer inputs.
Simplicity took over because it had to, and many companies report surprising increases in productivity as a result.
Now is the time for companies to look at the products that they don’t need and discard them.
And, when tempting new product opportunities arise, as they will, companies need to balance the obvious revenue opportunity against the hidden cost of complexity.
Now, companies have the opportunity to focus and simplify, but without intentional intervention to maintain this simplicity in the future, business and product complexity—along with all the processes, initiatives, meetings and reports that prop them up—will come creeping back in and proliferate.
Agility that lasts
In two short months, Covid-19 rammed through behavioural changes many executives had tried to coax from their companies for years.
Rapid innovation. Decisions made fast. Bureaucracy bypassed. Urgent needs tackled. Unimportant tasks shelved.
Quick, stand-up meetings focused on the demands of the day and the immediate goals of the week.
In other words, thousands of companies adopted agile methods almost overnight, a marvel of collective human adaptation.
Executives can’t afford to admire this spur-of-the-moment agility for long, however.
Without intervention, it will fade quickly when the perceived threat has passed, but we know that the next crisis is already on the way.
The same approach as previously will burn out the very people who pulled it off in the first place.
Covid-19 broke plans and budgets.
The new found focus on reducing complexity and simplifying offers the perfect opportunity to start with a clean sheet.
Understand who your future customers are, what they need and which highest-priority products will meet those needs, then budget for and fund the organisation and processes to support them.
Back to the future
Every company must figure out how to restart operations but the long path to recovery is beginning to separate companies into two distinct groups.
The first group wants to go back to normal, following the path of least resistance.
Having weathered so much risk, these companies are reverting to the tried and tested, restarting in predictable ways and settling back into old habits.
Understandable and reassuring, but destined to result in mediocre performance—even failure—in the new world.
The second group is committing to a harder path. Those companies recognise there is no normal to go back to.
Instead, they are advancing into the new future and capitalising on the gains from testing and learning through the crisis.
These companies are not simply navigating the restart, but positioning their companies for a world of continued turbulence and regular shocks to the system.
A world where adaptation and resilience will create the most value.