Preparing to take advantage of a post-pandemic rebound
As changes related to COVID-19 continue to ripple through the business community, resilient organizations are setting themselves up for future success
5 minute read
To call the COVID-19 pandemic an unprecedented challenge for businesses contacted by Ipsos and Crain’s Content Studio almost undersells its impact. A recent survey conducted by Crain’s Content Studio, Ipsos and Bank of America finds that 86% of companies have re-evaluated, redirected or retooled their strategy in the past year due to the pandemic. Businesses have had to respond to shifting client needs, workforce changes and supply chain disruptions. The rapidly evolving situation has often required quick decisions, as well as periods of extended uncertainty.
Despite these hardships, businesses have remained generally positive about the future. With the arrival of vaccines, most businesses are optimistic for a return to usual operations in the coming months. How much the new normal will resemble the pre-pandemic normal remains an open question, however. In many cases, taking advantage of a post-pandemic rebound will require businesses to stay flexible as they roll with a whole new set of changes.
Personal details build trust
More than two of every three companies surveyed indicated their business was negatively affected by the pandemic. Sue Duckett, Executive Vice President at Franklin Capital, a financial services firm in Highland Park, Ill., notes that the immediate impact of the pandemic depended on her clients’ industries. “Anybody that was dealing with big- box companies — apparel, the food industry — all of those were being hurt,” she says. “But the [personal protective equipment] businesses and anybody that pivoted to that field suddenly were doing very well.”
Businesses say the top challenges they’ve faced during the pandemic include maintaining workforce productivity in a remote environment, dealing with reduced customer demand, executing an accelerated digital transformation and supply chain disruptions. In many cases, they moved quickly to address these challenges. Six in 10 businesses report they have already completed workforce adjustments designed to keep their employees safe and 63% have completed the transition to remote work.
Further adjustments to supply chains and business strategies are more likely to be in the works, however. Another 39% of companies plan to redesign their supply chains, compared to 41% that have already managed to complete that work.
GrandPad, a California-based manufacturer of tablet computers designed for senior citizens, shifted its supply chain early on. “The Asian supply chain was definitely disrupted last spring,” says GrandPad’s CEO and Co-founder, Scott Lien. “We have worked really closely on more long-term visibility and forecasting, getting more buffer stock in terms of raw materials and parts, and keeping more buffer stock of finished goods in the US.”
Businesses are generally optimistic about the future
A large majority of decision makers (72%) expect their business to return to usual operations in the next six to 24 months. Business leaders in the technology and financial services industries are generally most optimistic about these timelines, possibly because their firms have seen less negative impact from the pandemic than those in other sectors. Executives in the professional services industry tend to see a slower return.
In many cases, leaders’ overall optimism reflects an expectation that the changes they have made during the pandemic will bear fruit in the months and years to come. “I’m not sure there were any new trends that happened during COVID — I think it just made certain trends happen faster,” says Amy Binder, CEO of RF/Binder, a communications and consulting company based in New York City.
Binder sees a more purpose-driven work ethic as a long-term benefit of this period. “There’s been a lot of talk in the past couple years about the role of purpose,” she says. “I think companies understand in a very different way that your purpose needs to link to what you do, both internally with your employees and externally with your customers and within the community in which you operate.”
Expect more changes as a new normal begins to emerge
Nearly three of four business leaders (73%) expect permanent changes to their industry as a result of the pandemic. In the long run, they most expect to see benefits from the investments their companies have made and will continue to make in technology, greater workforce flexibility, and a more nimble, resilient workforce.
Gary’s Wine and Marketplace had to rapidly add digital ordering capability that could be fulfilled by curbside deliveries, as patrons fearful of a shutdown crowded the company’s New York-area stores. “It forced an immediate acceleration for us,” says Gary Fisch, the firm’s Founder and CEO. “We need to continue to upgrade the technology because it was not designed to do as many deliveries as we’re doing — we’ve upgraded our phone system, we’ve got queuing now and we’re going to continue to invest in all that back-end technology,” he says.
The introduction of digital channels has potential to expand organizations’ reach as things return to normal. Even as some customers resume in-person transactions, others will stick with digital. Still others will take advantage of new opportunities as well. Phil Michaelson, CEO of New York-based Live Auctioneers, a digital platform for online auctions, sees strong potential to expand his company’s user base. “We see buyers who are really excited to participate in multiple auctions on a Saturday morning, as opposed to just one,” he says. “I envision a future where the folks who like attending events in person go in person, but also attend other auctions around the world virtually at the same time.”
Staying flexible while moving forward
During the pandemic, business leaders have been forced to deal with a massive amount of uncertainty in a short period of time. Over the long run, companies may build on the flexibility and resilience they’ve developed during this period. Katherine Zabloudil, CEO of consumer products manufacturer the Vertical Collective, headquartered in Redondo Beach, California, recalls the moment her team dug into the task of manufacturing personal protective equipment. “At first we were just paralyzed, and then after a couple hours, we basically just rolled up our sleeves and started going — calling factories, calling suppliers and securing airspace on cargo flights, just moving quickly. That’s what makes me the most proud of our company and how we define ourselves — the ability to move so fast that we don’t even have time to think about fear at all,” she says. “We have a nimble and smart team of people who can work really quickly and pivot really quickly.”
Ipsos and Crain Communications conducted the Bank of America Better Business Banking Report survey online between October 13th – November 20th, 2020 and January 4th – January 15th, 2021. Responses were collected using an online sample of business decision makers in the United States with annual revenue between $5 million and $99,999,999. From October 13th – November 20th, 2020 Crain’s contacted 73 business decision makers using a propriety list in Chicago, New York, Detroit, Boston, Minneapolis and Houston. From October 13th – November 20th, 2020 Ipsos contacted 751 business decision makers using a pre-recruited online sample of small business owners from across the country outside of the following markets: Seattle, Minneapolis/St Paul, Washington DC, San Francisco/Silicon Valley, Chicago, Atlanta, Los Angeles, Detroit, Charlotte, San Diego, Boston, Orlando, Phoenix, New York, Miami, Houston, Philadelphia. From January 4th – January 15th, 2021 Ipsos contacted 400 business decision makers using a pre-recruited online sample of small business owners from within the following markets: Seattle, Minneapolis/St Paul, Washington DC, San Francisco/Silicon Valley, Chicago, Atlanta, Los Angeles, Detroit, Charlotte, San Diego, Boston, Orlando, Phoenix, New York, Miami, Houston, Philadelphia. The final results for the study are not weighted.