Published on the 23/07/2020 | Written by Jonathan Cotton
The market researcher says these big shifts will permanently alter the business landscape…
Brace yourself for an uncertain future advises a new report from market researcher Forrester, because we’re still very much at the front end of the disruption caused by Covid-19.
The paper, entitled The New, Unstable Normal: How Covid-19 Will Change Business And Technology Forever says the effects of the pandemic will continue to be felt over the next decade and beyond, permanently altering the way we do business and use technology.
“Given its gravity, the effects of Covid-19 – along with other unpredictable eruptions of systemic risk – will continue to surface over the next decade,” says the report.
It’s a bold new business world and success will go to those who can adapt the fastest to the new conditions.
“This is just the beginning.”
It identifies five key ‘macro shifts’ – changes in customer behaviour, digital experiences, work, technology, and business resilience – that it predicts will cause profound short-, medium- and long-term impacts.
So what are those macro shifts and how can we prepare?
Contrasting customer expectations
The challenges of the Covid-19 pandemic have had a profound effect on customer expectations, with safety and convenience front of mind for many shoppers.
But it’s not a case of one profile fits all.
“The pandemic has affected global consumers in different ways, with their risk sensitivity and desire for convenience varying across region, age and culture,” says the report.
“There is wide contrast in how countries and consumers rely on digital solutions. For example, 60 percent of metropolitan Chinese ‘online adults’ are buying more online, while more than 35 percent of US and UK online adults still prefer in-store purchases.”
As the dust settles, expect social isolation and financial uncertainty to start playing a greater part in consumer decisions.
“Financial strain and lack of in-person group interaction will cause consumers to feel a lack of meaning and purpose,” says Forrester.
“This will influence spending on trusted brands that connect them to a greater cause.”
Ultimately, expect consumers to choose brands that offer the most control over buying experiences.
Trust is everything
As consumption and digitisation increasingly merge, customers will demand meaningful consumer interactions with brands, says Forrester. Business looking to better engage with their customers will have to show their ethical credentials every step of the way.
“As values-based consumers question the ethics of brands and as all experiences become digital in some way, new design practices will emerge that blend emotion and insights.”
Over the medium term, good design and user experience practices will become even more critical, with buy journeys focused on outcomes, not products, says the research company.
In time, success will come to those businesses that can best provision personalised, meaningful experiences. That means better leveraging customer information.
“Firms that can convince consumers to buy into sharing more personal data, such as biometric or behavioral data, will deliver anticipatory experiences that predict their shopping, financial and entertainment needs,” says the report.
It often takes a challenge to fully reveal what one is capable of. That’s been the case across both business and government, and with those successes expect higher expectations from everyone and increased investment to back it up.
“The pandemic has revealed the ability to do things that once seemed infeasible, including shifting entire workforces to remote working,” say the report.
“Remote working will boost regions around global economic hubs as firms shed more than a quarter of their city-center office space.
“The firms with the biggest competitive edge will unite humans and technology (eg, artificial intelligence or automation) to build engaged workforces.”
The redistribution of work is here to stay and will result in further emptying and repurposing of traditional office spaces.
New tech investment
Investment and flexibility will be the key to riding the technology disruption wave, says Forrester.
“Tech and business leaders that accelerate digital outputs – by retiring technical debt – and replatform systems, per the pandemic, will acquire a robust digital operating platform and the needed flexibility to overhaul business models.”
Over the medium term expect more transparent and flexible supply chains as procurement and logistics shift to blockchain/distributed ledger technologies.
Consider resiliency a competitive advantage
Still smarting from the disruptive shock of the Covid-19 pandemic, expect continued business investment in continuity capabilities such as crisis management, with increased business continuity testing, both for future pandemics and other risk scenarios.
Over the longer term, leaders will need to invest in enterprise risk management capabilities to better evaluate and respond to risk in real-time.
It’s a bold new business world, says Stephanie Balaouras, VP at Forrester, and success will go to those who can adapt the fastest to the new conditions.
“The pandemic has fundamentally changed the way we do business,” says Balaouras.
“It has forced firms and policymakers to do things that were previously considered impossible.
“As a result, business leaders are quickly embracing new, iterative ways to engage with customers, adapting to new ways of working, investing in technology innovation, and revisiting their business resiliency plans for long-term success.”