BUSINESS Beyond Covid
VUKANI MNGXATI: Reopening a chance for businesses to reinvent their operations
In the Business Beyond Covid series, CEOs and other business leaders and experts in their sectors look to the future after Covid-19. What effect has the pandemic and resulting lockdown had on their industries and the SA economy as a whole? Which parts will bounce back first and which will never be the same again? Most importantly, they try to answer the question: where to from here?
Just weeks after winding down their operations, companies in SA are being asked to restart their engines at an unprecedented rate as lockdown rules are gradually relaxed. The challenge is complicated by uncertainties about the progression of Covid-19 and the social, political and fiscal actions it will drive.
Reopening requires more than a return to normal, because the unpredictable and long-lasting period that follows this pandemic will feature fundamental changes to economic activity, fast-changing cultural norms, societal values and behaviours. To reopen and outmanoeuvre uncertainty also requires a programme of reinvention.
This presents an opportunity — and a need — for many companies to build the competences they wish they’d invested in before: to be more digital, data-driven and in the cloud; to have more variable cost structures, agile operations and automation; to create stronger capabilities in e-commerce and security. This agility will be core to the long-term capabilities they build.
Leaders should consider the steps they take to reopen as the first in a long journey of wider transformation. As evidence grows that we’re coming to the end of the initial peak, SA and local companies are beginning to shift focus to reopening. Lockdowns have affected the majority of the workforce all over the world. Most countries have begun to take a phased approach to reopening, beginning with essential sectors. In India, for example, restrictions were first eased on manufacturing, and farming in rural areas.
In deciding how best to phase the reopening of sectors, business leaders will need to consider the extent to which jobs in a sector can be performed at home, the economic implications if it does not reopen in terms of lost jobs and output, and the risk of workforce exposure to Covid-19.
The easing of restrictions is no guarantee of a quick return to normal — there are a range of potential scenarios for the evolution of the crisis. We could see the quick rebound of rapid remission. But with the virus still circulating, the possibility of recurrence will remain high, with cyclical outbreaks requiring lockdowns to be rapidly reinstated.
Companies shouldn’t count on a smooth return — they may be swamped by people eager to get back to work despite continued risks. In short, the prospects for reopening are far from certain. Companies will need to be prepared to change course on a dime, and any steps that are taken to reopen should therefore be easily reversible and scalable.
Employees are likely to be concerned about the prospect of physical interaction while the virus is still circulating. Companies will therefore need to ensure they provide a safe and secure work environment, communicating with their workforce transparently to build trust.
In addition, companies should not reopen by reverting to old ways. Employees have adapted to new ways of working — some of which they may prefer. New processes and capabilities are a stepping stone to longer-term business transformation. The reopening is an opportunity to create a better future for employees and customers.
What needs to happen:
- Put people first. Knowing what is really going on in the lives of employees is essential to creating the next generation of successful business. Technology, processes and employees will need to become even more truly human in how they interact with people. It starts with responsible leadership.
- Design spaces that work. Companies must create a safe working environment that gives people confidence to return to work and adjust to the new virtual-physical hybrid way of working. Support for employee wellbeing and mental health is a priority. The future workplace will also need new approaches to security.
- Solve in phases. The reopening is just the start. Companies should plan for a phased return that responds to unforeseen events, slippage and reversals. Companies should see this not as a time to return to “normal”, but an opportunity to rethink, re-engineer and improve future operations.
- Commit to an elastic cost structure. Having secured short-term liquidity, companies will need to focus on the longer-term financial health and affordability of the business. That means moving from rapid cost reductions to building a resilient cost management mindset, and from balance sheet protection to long-term investment.
- Get future ready. The secret to the long-term success of reopening lies in building new capabilities — fresh approaches to innovation supported by more holistic technology strategies that, in turn, support innovation at scale. Purpose, empathy and agility must be at the centre of new customer growth opportunities.
Reopening will be more than a restart. It will be the beginning of a new era of business. The rules have changed. Employee and customer behaviours have changed. But this creates new opportunities for organisations with the courage and foresight to change more than immediate needs demand.
Those that can reinvent themselves — their processes, customer experiences, employee and social contracts — and do so in ways that further their purpose, will win. Outmanoeuvring uncertainty, by mitigating immediate challenges while building a better future, will create organisations that one day look back on the crisis as the darkness before the dawn.
• Mngxati is CEO for Accenture in Africa.