To succeed and stay profitable in the coming months and years, organizations must develop a post-COVID-19 business plan.
Existing plans, as most business leaders know, are no longer relevant – new ones will be needed to survive and thrive during the post-viral era.
To create suitable strategies, it is important to understand:
- How the pandemic is impacting the business landscape
- How it will continue to unfold
- What the world will look like after the virus has subsided
- Effective strategies that can be applied across industries
In this article, we will cover these topics and more.
To start off, we should first learn how the pandemic will shape the economy and the world in the years ahead.
What Will the Post-COVID Era Look Like?
Many analysts and research firms predict that the world will be irreversibly changed by the pandemic. According to McKinsey, for instance, the COVID-19 pandemic will deeply affect the global economic order.
In short, we won’t return to the same normal that we once knew – instead, we’ll be returning to what they call “the next normal.”
McKinsey, Accenture, BCG, and many others agree that the pandemic will fuel a major paradigm shift that will affect many aspects of business, society, and our daily lives.
One consequence of this shift is that businesses must make major changes to their business strategies, plans, and operating models.
Naturally, before making such major changes, organizations will need to understand what changes lie ahead.
Below, we will examine a few of the biggest trends to watch for during the post-COVID era.
COVID-19 quickly transformed from a global health crisis into the largest financial crisis of our lifetimes.
Government restrictions, such as lockdowns and mandated business closures, severely disrupted businesses and entire supply chains.
The entire financial system contracted in response, resulting in job losses, bankruptcies, reduced customer spending, and more.
Though the economy will rebound at a certain point, it will take significant time – and the competitive landscape may look very different in the coming years. Small businesses and certain industries, such as the airline industry, may need to be rebuilt from the ground up, for example.
Customer Experiences and Needs
The pandemic has also had a significant effect on customer expectations and behaviors.
- The economic impact has depressed customer spending
- Online shopping has become more popular because it is safer
- Customers prefer businesses that offer more hygienic products and services
Some of these trends will reverse to a certain extent.
At the same time, however, the experience of the pandemic will undoubtedly fuel an increased demand for health-related services, hygienic business practices, and so forth.
In fact, Accenture even suggests that every business will need to become a “health business.”
Though every customer base and audience segment will respond differently, businesses can fully expect that their customers’ expectations, needs, and behaviors will shift in some way. Customer-centered business practices, covered later, will become even more essential as we move forward into the next normal.
The Workplace and Employee Expectations
Health concerns and requirements will also fuel many changes to the work environment.
Some of these will be driven by shifts in employee expectations, while others may be mandated by governments and regulatory agencies.
A few changes that we can expect include:
- An increased need for health precautions in the workplace
- On-site health checks
- More telecommuting
- Less business-related travel
In short, many of the changes that occurred during the pandemic will have a lasting impact – and some may even become permanent features of the post-COVID world.
Digital technology will be one of the most important areas to focus on when designing post-pandemic business plans.
There are several reasons why:
- After COVID-19, the world will be far more reliant on digital technology
- Digital technology can improve organizational resilience, performance, and agility, among other areas
- Many digital trends and technologies are making substantial progress during the pandemic, such as robotics and telehealth
- Digital leaders will have a better chance of innovating and outperforming competitors
Trends such as these will end up reshaping the world after the crisis, rebalancing the technological landscape and contributing to a more digitally advanced economy.
Reasons such as these should compel organizations to continue driving digital transformation efforts, or even to accelerate them.
Mapping Out the Journey
The trends covered above will continue to influence the global economy over the course of the pandemic, but these changes will take time to develop.
Planning for the post-viral era will require, among other things, an understanding of the journey that lies ahead.
Below is a three-stage roadmap that describes how the pandemic will unfold:
The first stage of the pandemic was the crisis itself.
During this phase:
- Governments implemented lockdowns and quarantines
- Businesses shutdown worksites and implemented remote working procedures
- Travel restrictions limited local and international travel
- Other government restrictions limited business operations
- Organizations initiated business continuity plans
For the most part, most governments and organizations simply did their best to mitigate risk, reduce losses, and assess the situation.
At this point, the true scale of the crisis remained uncertain – for the most part, organizations did their best to maintain operations and chart a path forward.
By mid-2020, the scope and scale of the crisis had become clearer.
Business leaders had a better grasp of the pandemic’s impact and, as a consequence, what their options were.
During this phase of the crisis:
- Business continuity efforts will continue as necessary
- Overall economic performance remains stagnant
- Organizations must plan for further potential disruptions
- Leaders pivot existing strategies and operations to fit the current climate
Most experts suggest that this stage of the pandemic will last until a vaccine is developed and distributed.
Once that occurs, then health restrictions will begin to relax. And, as a result, the economy can begin its path towards full recovery.
3. The Next Normal
The next paradigm after COVID-19 goes by different names, depending on the source.
McKinsey calls that paradigm “the next normal,” Accenture calls it “the Never Normal,” and many others simply call it “the new normal.”
Regardless of which label one uses, the fact remains that the post-COVID age will be far different from the pre-2020 era, as we saw above.
To succeed in that new paradigm, businesses must:
- Plan for many of the changes mentioned earlier
- Survive the remainder of the pandemic
- Implement aggressive changes to operations and strategies as needed
Making deep organizational changes may not be necessary for every organization, but for a great many, it will be.
After all, since the entire economic system is undergoing transformation, businesses will need to adapt.
How to Design a Post-COVID-19 Business Plan
Here are a few frameworks and tools that business leaders can use to create business plans for the post-COVID world:
A 5-Stage Framework from McKinsey
McKinsey, as mentioned, coined the term “the next normal,” which has become widely referenced by other businesses around the world.
According to their analysis, businesses and institutions will pass through five separate stages on their way to the next normal:
- Resolve. During the initial weeks and months of the outbreak, businesses were mostly focused on crisis response efforts. These included remote working, workplace safety measures, and other procedures aimed at protecting the business. Business leaders were tasked with determining which actions to take, as well as the depth and pace of those actions.
- Resilience. As the health crisis quickly transformed into a global financial crisis, it became apparent that the scale of the crisis would perhaps be the largest crisis faced in the past century. Governments struggled to keep the financial system afloat, while multiple sectors faced liquidity and solvency challenges.
- Return. Disaster recovery and the restoration of business operations became the next priority. However, sporadic outbreaks and secondary waves continue to threaten businesses in the absence of a vaccine. Businesses and governments both were faced with the difficult decisions of reopening, versus the financial threat of staying closed.
- Reimagination. The ongoing changes to the economy will require businesses to reimagine their business models. On the one hand, we will continue to face new challenges and risks, but at the same time, new opportunities we be revealed. Leaders will better understand how to create businesses and networks that are more resilient and productive.
- Reform. Over time, the “black swan event” that is COVID-19 will drive reform in a variety of areas. Public health systems, government regulations, and business practices will all be forced to rethink their operations in order to become less susceptible to such events in the future.
This model can serve as a roadmap for the remainder of the crisis, while also offering useful indicators of what we can expect in the post-COVID era.
Deloitte’s Flexible Scenario Planning
Another useful planning strategy comes from the consulting firm Deloitte.
One model, offered by Deloitte’s UK branch, provides a flexible scenario planning strategy that can be used during the remainder of the crisis. Since government restrictions can severely impact business operations, the model advises creating a set of plans based around those restrictions.
Deloitte suggests creating plans for three specific time periods:
- When restrictions are at their peak. As restrictions rise, so too do limitations on business operations. These limitations can result in the closure of work locations, an increase in remote working, and less consumer spending. Since these restrictions can occur at any time, businesses should be prepared to implement plans for these scenarios at any time.
- Just after restrictions have begun to relax. In many countries, restrictions tend to be lifted in stages, allowing businesses to restore operations under certain conditions. These conditions will vary from location to location and from industry to industry, so business leaders should evaluate their own government’s regulations when designing plans.
- After most restrictions have been lifted. At some point, regulations will be relaxed almost entirely, allowing businesses to restore normal operations. Plans should also be made for these periods, though, as mentioned elsewhere, restrictions may be implemented again in the event of an outbreak. For that reason it is important to maintain plans for all three scenarios.
In addition to developing specific plans for each scenario, Deloitte points out that those plans must be evaluated and “stress-tested” to ensure that they are actually viable.
Deloitte’s planning framework will be useful during the remainder of the crisis, as we move towards the post-COVID new normal.
Since it is more concrete and tactical, it may be more easily implemented than some of the other frameworks covered here. However, since it is not as high-level as others, this framework should be used in combination with some of those that look farther into the future.
Another Approach to Scenario Planning, from BCG
Boston Consulting Group (BCG) also recommends a scenario-based planning strategy.
BCG says that it helps to design each scenario around several factors:
- The public health situation, its duration, severity, and location
- How relevant government restrictions will impact the firm
- The macroeconomic environment
- Demand in specific business scenarios
Key indicators can be established for each of the factors listed above, to provide ongoing insight. Employment and investment levels, for example, can be used as indicators for the state of the economy.
To ensure that each scenario is implemented effectively, BCG also recommends:
- Building strategies based on the company’s starting point
- Planning for several time horizons, rather than just the short term
- Maintain situational awareness and act accordingly
- Shape the policy environment as needed to improve the chances of success
By following these principles and building a supporting organizational structure, organizations will be able to make effective decisions in the short-term. And, by maintaining their long-term strategic thinking, they will be prepared to confront the new normal.
5 Human Truths to Watch For, According to Accenture
Accenture claims that in the wake of the virus, we will face five new “human truths” that will impact sentiment, behavior, and, as a consequence, business strategies.
The firm suggests that:
- Customer confidence will erode, which will increase the importance of trust. As apprehension rose related to the virus, purchases were postponed and many businesses attempted to compensate with virtue signals and more virus-related noise. In such an environment, it should not be surprising that overall confidence decreased in a number of areas. The cost of earning that confidence back, therefore, will increase after COVID-19 has ended.
- Virtual services and interactions will become the norm. The virus has spawned a massive trend in virtual services and activities, from remote working to online shopping. Accenture suggests that after the pandemic, the preference for virtual activities will significantly increase, ushering in what they dub the “virtual century.”
- A health-related economy will emerge and redefine customers’ expectations and relationships with businesses. Not only will the health industry become more popular, every business will become a health business, estimates Accenture. Health-related features will become far more common in products, and they may even become mandatory in certain industries – germ filters, for instance, may become required in certain types of vehicles.
- People will be more likely to “cocoon” at home, which will impact products, services, delivery, and so forth. Today’s virus-related concerns will remain for some time to come, and a number of people will stay at home in order to keep safe. This particular trend may only affect certain segments of the population, however, since extended quarantines seem to actually spur restlessness (see below).
- Government authority may be redefined in certain regions, depending on how well those governments handled the crisis. In other words, if the government’s measures agreed with the people, then they would likely continue to support the government and trust it with more governing power. If those measures proved ineffective or weren’t amenable, then people may resist top-down governance.
These profound changes, if true, will impact every organization, regardless of their audience or their market. In fact, they will even impact the workplace and the workforce.
Planning for these shifts in human perspective should become one of several key focal points, but there are several other important areas to focus on as well.
A Post-COVID-19 Checklist: Top Priorities to Focus On
The frameworks covered above can be useful tools when developing a post-COVID plan. Below, we’ll cover a few key points that should be included in those strategies:
1. Protecting employees and customers
During any crisis or emergency, organizations should prioritize the health and safety of their people.
At the outset of the coronavirus pandemic, this took the form of:
- Remote working
- Closure of work locations
- On-site health and safety precautions
Protecting people extends beyond health, however.
In the case of the current crisis, it can also include financial protection and job security. Businesses that choose not to lay off employees, for instance, are protecting their workforce.
Through these types of protection, an organization can, in turn, earn the support of those people – support that will be vitally necessary on the road to recovery.
2. Agility, resilience, and adaptability
Today’s crisis has demonstrated the importance of organizational agility and resilience.
Though both terms are similar, they reflect different concepts.
Organizational resilience refers to an organization’s ability to survive disruptions that impact business operations.
To become more resilient, organizations should focus on areas such as:
- Business continuity planning. Business continuity planning focuses on protecting key business functions and restoring operations. Effective continuity plans reduce the negative impacts of business disruptions, such as financial damage and the effects on the workforce.
- Emergency response plans. An emergency response plan differs from a continuity plan in that it specifically aims to protect people during an emergency situation. These emergencies can include natural disasters, fires, workplace accidents, and other situations that would impact human safety.
- Risk assessment and management. Risk management evaluates the risks associated with a particular business activity. This business discipline can be applied in many business areas, including change management, digital transformation, and business continuity. Assessing risk can help business leaders prioritize prevention and mitigation strategies.
- Cyber security and digital maturity. Cyber security minimizes the risk of data breaches, hacks, and other online hazards. Digital maturity, on the other hand, refers to the overall digital capabilities of an organization, including its software, IT infrastructure, and employees’ digital skill levels. Both can improve an organization’s ability to operate and rebound in the event of a crisis.
The more resilient an organization is, the less it will be impacted by major business disruptions.
Agility is equally important, though it covers different territory.
An agile organization:
- Can pivot strategies and activities quickly. Fast response times are crucial in today’s fast-paced world. Customer sentiment can change rapidly, demand can fluctuate at a moment’s notice, and disruptions can have serious consequences in the marketplace. Agility can decrease response times, speed up project implementations, improve the efficiency of organizational transformation, and more.
- Responds to real-world circumstances, rather than following static plans or preconceived notions. Agile business processes are built around customer feedback and real-world data. This lean approach reduces waste and keeps products relevant to customers’ actual needs, rather than preconceived ideas or assumptions. The result: happier customers who are more loyal and more profitable.
- Stays human-centered, responsive, and data-driven. Collaboration is fundamental to agile business processes. A lack of collaboration, on the other hand, reduces communication, increases internal discord, and can negatively impact the workplace. By building collaboration into business processes, businesses can cultivate a better workplace, improve innovation, and create a more adaptable business.
Adaptability and speed are two characteristics commonly associated with agility, and it should be easy to see why agility is so important.
The more agile an organization is, the more efficient, productive, and effective it is.
In an era whose only constant is change, agility will not just be an advantage, it will be a survival trait.
3. The evolving customer experience
Customer expectations evolved quickly during the initial stage of the outbreak: health concerns kept many people at home, discretionary spending dropped, online shopping increased, and so on.
However, customer sentiment can swing in the opposite direction just as quickly, as some UK retailers discovered when they reopened their stores after lockdown.
During the pandemic, a number of factors can impact customer sentiment and behavior, such as:
- Health concerns
- Lockdown requirements
- Government restrictions
When planning for the new normal, it is important to keep these types of factors in mind, which can help when making scenario-based plans.
However, it is difficult to predict customer behavior during stable economic conditions. In crises and unstable economic environments, accurate predictions become even more difficult.
For that reason, it is critical to stay agile, lean, and customer-centered, as mentioned above.
Namely, it is important to:
- Closely monitor customer sentiment and activities in real-time. Customer sentiment can shift rapidly, especially in today’s socially networked world. A single event, for instance, can be instantly transmitted to millions of people worldwide, fueling shifts in customer behavior and sentiment. Brand monitoring and customer analytics can offer real-time insights into that sentiment, which is essential for an effective response.
- Adapt marketing and sales strategies accordingly. When customer sentiment changes, sales and marketing tactics should also change. Along with brand monitoring solutions, businesses should have a marketing stack that allows them to make rapid changes to their customer experience.
- Redesign products and experiences to align with those customer expectations. McKinsey, for example, recommends that industrial companies replace their existing product development strategy with a new approach, termed Rapid Product Improvement (RPI). While less comprehensive than traditional approaches to product development, this technique increases speed and collaboration. And in the current business climate, these two traits can make a big difference in marketplace performance.
In many cases, businesses may need to rethink their existing operations and strategies.
Becoming agile may require significant change, in other words – and while that change may not be easy to implement, it may in fact become necessary in the coming months and years.
4. Organizational change
To stay relevant, many companies may need to make major changes.
Such changes can include:
- Changes to operations, strategy, or the business model. In the post-COVID era, businesses may need to make major transformations that affect their entire company. The next normal, after all, will be accentuated by changes to customer behavior, the economy, society, digital technology, and more. To survive and thrive in that landscape, many organizations may need to reimagine their very place in the business ecosystem.
- Organizational restructuring. Restructuring an organization involves the redistribution of team members, hierarchical restructuring, designing new business units, and so forth. If an organization makes major strategic changes, restructuring may become necessary.
- Organizational culture change. As many business leaders know, organizational culture impacts business performance, the employee experience, and ultimately the customer experience. Cultivating certain cultural traits, such as self-reliance and digital savviness, can enhance organizational performance, improve the work environment, and more.
Or, in some cases, an organization may need to undergo a complete transformation. That is, a company may need to fundamentally redesign and restructure itself from the ground up.
When implementing organizational changes, large or small, it is essential to take a structured approach to change management.
An organizational change management team, led by a change manager, will coordinate, implement, and manage a change project.
The benefits of structured change management include:
- Improved efficiency, timelines, and outcomes
- Decreased employee resistance
- Greater chances of successful change
Change management is a well-established discipline that can significantly improve the performance of a change program, making it well worth the investment.
5. Digital transformation, adoption, and maturity
The current crisis has disrupted many industries across the globe. Some industries have stalled, others have slowed, but a few have actually continued to grow.
As mentioned above, despite an overall decrease in IT spending, digital transformation continues to accelerate.
The crisis, in fact, has become a catalyst for certain technology trends:
- Telehealth use has skyrocketed in certain parts of the world
- Robots have been used to clean streets, make deliveries, greet customers, and more
- Remote working software has fueled online teams around the globe
COVID-19 has also exposed vulnerabilities in other areas that can benefit from increased digitalization, such as the supply chain. In the near future, areas such as these will undoubtedly attract more investment.
Every industry will progress differently in terms of digital technology.
However, given the overall pace and trajectory of the business world, what is certain is that the post-COVID economy will be more dependent on technology.
To prepare for that economy, organizations should allocate resources into areas such as:
- Digital skills training. Employee training and development must evolve to keep up with the digital workplace. Digital skills are required for the modern enterprise employee, especially since businesses adopt new tools so often. However, training must also evolve to keep up with the changing digital work environment – classroom training and in-person training, though suitable for certain activities, aren’t suitable for software training.
- The development of a digital culture. Digital skills training can certainly improve employees’ workplace skills. However, to truly become an efficient digital workplace, companies must evolve their workplace culture as well. In other words, there must be a seamless interplay between employees and their tools. They must be pro-learning and pro-technology, which will improve innovation, engagement, and performance.
- Modernizing the IT infrastructure. Naturally, without the right tools and infrastructure, employees will not be able to execute the processes that are required of them. It is crucial to lay the foundation of a digital-first business strategy by building a modern IT infrastructure, installing modern tools, and integrating those systems. Obsolete technology, after all, will only slow down employees and limit the organization’s performance.
- Creating an integrated digital workplace. The digital workplace is a concept that emphasizes the need for holistically integrating tools, employees, and work processes. Merely deploying new software, in short, is hardly enough to drive innovation and performance. Instead, the digital workplace must be built to fuel innovation, performance, and the digital-first employee.
In short, organizations should become more digitally mature.
Digital maturity refers to a company’s overall digital capabilities – the more digitally mature an organization is, the greater its capabilities.