Has the pandemic made innovation more vital than ever?
The COVID-19 pandemic has impacted massively on every aspect of our working lives affecting everything from how and where we work to the way we interact with and support our clients.
The scale of the upheaval was brought into sharp focus recently when 90% of business leaders interviewed by international management consultants McKinsey said they felt the pandemic would both fundamentally and permanently change the way businesses operate. However, the results of their study were quick to add change doesn’t have to be a bad thing.
More than three quarters of those interviewed said they felt our recent experiences will create new opportunities for growth and this growth will be underpinned by a continued drive to extract the maximum benefit from both technology and innovation.
Why is innovation essential?
Irrespective of the sector you operate in, it’s evident we won’t be able to continue to operate as we always have.
What began as a temporary situation has become protracted if not permanent. To remain successful, businesses will need to establish a new model that serves their customers’ changing demands whilst meeting their employees’ preferences and safety requirements.
This means there are four major areas every business leader will need to consider:
- Adapting to meet changing customer needs
- Identifying and progressing the new opportunities arising in new look markets
- Re-evaluating the innovation/technology being employed and the allocation of the supporting resources
- Building the infrastructure needed to remain competitive in the short term and support post-pandemic growth in the longer term
At first sight this list looks like a tall order. However, the good news is the last 15 months has taught us invaluable lessons. We not only know what we need to do to achieve these four objectives, but also that we will need to stay on a path of continual improvement while we meet these four objectives.
Two years ago, few if any senior executives really understood crisis management. Fast forward to the second quarter of 2021 and we have all amassed enormous and very real experience of enterprise agility, more stringent cost and cashflow management, workforce resiliency, and the wholesale implementation of new technology.
A large part of the reason why so many business leaders have been able to successfully navigate the potentially crippling impact agility, resilience, large-scale changes to working practices and cost and cashflow management boils down to a bigger and better use of technology.
If success is to continue, the current period of digital transformation will need to continue.
Although restrictions are easing, the unprecedented pace of change imposed by the pandemic is only increasing. This appetite for change is as evident internally as executives see that introducing the right innovation has reduced costs and increased productivity as it is externally as clients and customers recognise they can be looked after more efficiently and with greater flexibility.
A new study released by The IBM Institute for Business Value has found 59% of the organisations feel the pandemic forced them to accelerate their own digital transformation. However, the real value from the study is in the accompanying commentary.
From their interviews The Institute has drawn five overarching conclusions. They believe these five conclusions will play a pivotal role in the next phase of our digital transformation and in the way we continue to increase our reliance on technology. These conclusions are:
1. Digital transformation isn’t just about technology
While moving entire workforces to remote working and rebuilding workflow, security and supply has forced us to find new solutions, there is much more at play. There has also been a huge culture shift in most businesses.
Partly this has been defensive. Delivery had to be maintained, revenue had to be protected but costs also had to be managed particularly carefully.
However, this shift has also been massively positive. Many businesses have finally been able to implement measures that had until the pandemic been opposed either for cost reasons or because there just wasn’t the confidence the business had the people or capabilities to support their adoption.
2. The human element is key
The keys to successfully implementing new technology are:
- The people behind it (i.e. the employees that make it happen)
- The people it serves (the customers who enjoy an improved client experience)
This means that if our increased interest in technology and innovation are going to continue to deliver growth, training and client experience management will have to be pushed to the top of our to do lists.
More than 75% of the executives interviewed think the vast majority of their market-facing future (purchases and client service interactions) will happen online. As a result, they are already planning an even higher adoption of AI-based customer engagement tools to improve their virtual client experience.
At the same time, they recognise that if they are to manage their employees in the new hybrid working environment, then training and communication will be key, particularly as employee satisfaction and wellbeing become increasingly strained because of remote working.
3. Don’t let fire-fighting override strategy
Predictably and unavoidably, the last 15 months have been about fighting fires rather than strategising in the traditional sense.
However, taking the next step successfully will involve finding the technologies and processes that will allow executives to balance the seemingly conflicting demands of improving operational efficiencies alongside stratifying their client’s developing demands so the organisation can deliver on its vision.
4. Unity is powerful
More and more businesses are considering forming partnerships and joint ventures. Such arrangements provide access to the additional skills, services, and supplies they’ll need to create the level of growth and competitiveness they want to achieve without incurring the usual set up, management and development costs.
And these partnerships are not limited to complementary organisations operating within their industry. There is also a call for more creating partnerships with those outside their immediate industry, with their suppliers.
Nowhere is the benefit of an external partnership more obvious than with technology.
Bringing in experienced partners capable of assessing exactly where improvements in technology could make immediate improvements to the existing operational and client service models is becoming increasingly common. We feel that as the financial benefits of these improvements filter down to the bottom line, both interest and investment in innovative new ways of working will increase and increase dramatically.
5. Sustainability is a huge consideration
While our focus has shifted from the environment to personal health and safety over the last year, sustainability will reappear as an important issue.
Consumers will continue to choose the products and brands they believe demonstrate environmental responsibility which means companies need to continue to find operational, manufacturing and workflow methods that will reduce their carbon footprints and allow them to manage their waste and energy consumption more efficiently.