- During the current situation, change is the key constant, and organizations are leaning on agility, resilience, and technology to thrive now and in the future.
- The pandemic has created operational challenges for companies across all industries, yet the defining characteristic for success is flexibility.
- The COVID-19 pandemic has created new opportunities to build better businesses, particularly those that “drive competitiveness by tying digital transformation to business priorities.”
New research from the IBM Institute for Business Value found that “change remains the name of the game”.
The research found that company executives are having a hard time prioritizing capabilities as they try to make sense of what the post-COVID business environment will be like. As a result, IBM argues that in the next two years, “we should expect another huge shift in prioritization.”
So, what are some of the many areas executives are prioritizing now and in the future?
According to the report, top priorities for organizations include:
- Workforce safety and security
- Cost management
- Enterprise agility
- Digital transformation
- Cost control and cash-flow management
- Workforce resilience.
“Whether reflecting on current conditions or future plans, business leaders’ needs for speed and flexibility have been amplified dramatically. Old barriers are being brushed aside under the pressure of unrelenting disruption, rapidly evolving customer expectations, and an unprecedented pace of change.”
As change remains the name of the game, organizations are leaning on agility, resilience, and technology to thrive now and in the future.
IBM’s research identified five key discoveries for the post-pandemic business landscape.
Five “Epiphanies” for Post-Pandemic Business Success
1. Digital transformation was never just about the technology
Last year, in a conversation with Allwork.Space Tony Saldanha argued that “digital transformation is more of an HR issue than an IT issue.”
IBM’s recent research report confirms this. The research found that the COVID-19 pandemic accelerated digital transformation at 59% of organizations. Additionally, 66% of organizations stated that they were able to complete initiatives that previously encountered resistance.
The acceleration of digital transformation did not take place beecause new technologies emerged. “Rather, the tools already at hand were deployed to fuller potential.”
IBM reports that digital transformation efforts were accelerated due to a culture shift that was in part defensive: to reduce costs and remain resilient.
Regardless of the motivations, the change marks a new era for organizations.
“Some 55 percent of respondents say the pandemic has resulted in ‘permanent changes to our organizational strategy.’ An even larger 60 percent say COVID-19 has ‘adjusted our approach to change management’ and ‘accelerated process automation,’ with 64 percent acknowledging a shift to more cloud-based business activities.”
Organizations report plans to invest more in technologies like AI, the IoT, blockchain, and cloud in the future. While reliance on tech platforms have become and will continue to be more acute, organizations need to prioritize their human resources in order for these technologies to deliver the desired results in the long term.
“Organizations need to be sure their people are as capable, resilient, and adaptable as their technologies.”
2. The human element is key to success
The success of companies now and in the future lies in human resources. IBM research and data found that “business competencies that account for the largest part of an organization’s expected growth are those centered around employees and customers, such as workforce training and customer experience management.”
As a result, 84% of executives say that their organizations will prioritize customer experience management over the next two years.
Yet, despite the fact that organizations recognize the value of employees and that they have been under intense pressure during the COVID-19 pandemic, there seems to be a gaping chasm between what companies are offering and what employees need.
The research found that “employers significantly overestimate the effectiveness of their support and training efforts. Only about half of employees say they believe that their employer is genuinely concerned about their welfare.”
Needless to say, there is an opportunity for businesses to focus on their human resource and ensure that they are providing the right support for them to thrive.
3. Traumatic stress has hijacked corporate strategy
Organizations are prioritizing everything. While that sounds good, the opposite is true. Prioritizing everything means that all the focus is spread out, and therefore nothing is prioritized… at least not correctly.
IBM argues this has led executives to be enamored with the priority du jour.
Priorities are changing on a regular basis, and the pandemic has amplified old business fears and introduced new ones, making it harder for organizations to focus their efforts where they are needed most.
“Since the beginning of 2020, executive priorities have been a bit fluid, and they’ve reshuffled again the last few months. Now they seem to be focused on internal operational capabilities.”
Internal objectives that have taken center stage include:
- Cash-flow and liquidity management
- Cost control
- IT resiliency
As it currently stands, it seems like everything is important. “Everything except improving the customer experience — the one thing that can help drive performance and growth when the competition is lost in the fog.”
4. Some will win, some will lose… but few will do it alone
In the post-COVID business world, partnerships are key to success and, in some cases, survival.
IBM’s data “points to greater reliance on platform business models and partner networks, with 70 percent of executives planning significant partnering activity inside their industry and 57 percent looking outside. Either way, they expect such participation to grow more than 300 percent over the next two years compared to two years ago.”
While the pandemic has impacted all industries, it hasn’t impacted them equally.
Health-related sectors, telecommunications, and media and entertainment were listed as the most likely post-pandemic winners by executives. Travel and transportation and manufacturing-intensive industries were cited as the most likely losers.
However, the research shows that agility and flexibility is a defining characteristic for success, both among potential “winner” sectors and those that have been more severely impacted.
“Large enterprises that can operate with agility have been the ones to remain steady (in a troubled sector) or outperform.”
5. Health is the key to sustainability
Unsurprisingly, health has become a top concern for executives across the board.
Prior to the pandemic, sustainability was mostly centered around environmental issues. This has changed.
“Faced with a human health crisis, environmental sustainability became joined with issues of personal safety.”
Together, these two elements have expanded and created a more complex definition of sustainability.
“New burdens are already appearing for corporations, as they must make good on existing sustainability goals — reduced carbon footprints, more efficient waste management, or otherwise — while simultaneously meeting new health-and-safety requirements.”
The Future of Business
The COVID-19 pandemic has created a new opportunity to build better businesses.
“We are on the leading edge of a self-reinforcing process, promising even greater acceleration ahead. This presents an enticing opportunity for executives who can manage complexity and drive competitiveness by tying digital transformation to business priorities.”