Profit in a time of cataclysm

There is nothing new in the idea that the greatest crisis can also present the greatest opportunity. As COIVID-19  destroys the travel, events and live entertainment industries globally, it is also forcing organisations to change the way they operate.

This will be deeply disruptive and, for some, ruinous. However, many will find that it is as if scales have been removed from their eyes. They will wake up to a new day where the sun sheds light on modes of operation that should have been obvious all along.

We have already seen a rapid shift from physical to virtual events, meetings, classes and logistics. This shift dramatically highlights the importance of overcoming physical limitations.

As such, it is a watershed in the history of the Internet, as it forces those who had held onto traditional modes of operation to move to a model that embraces greater efficiency, cost effectiveness, participation and visibility.

For example, the pandemic forces all companies to explore ways for their employees to work from home. The initial knee-jerk reaction from much of the business world has been to close offices and send staff on enforced leave. This is not only short-sighted and fixed in the mould of 20^th century management philosophy, but in fact reveals an inability at executive level to appreciate the extent to which digitalisation has utterly changed the rules of management.

One can blame incompetence and ignorance, but in reality it is about the comfort zone. The pandemic has exposed the extent to which organisations of any kind have been accustomed to their comfort zone, and to business as it used to be. The virus is forcing them out of their comfort zone, but many have not yet accepted the new reality. If it gets worse, they will be dragged, kicking and screaming, into this reality.

Why are they so blinkered? The truth is that, in many organisations, executives and managers see their roles as managing people rather than having business outcomes as a priority. As a result, they need to see productivity as a very specific activity occurring in their physical presence. This is a consequence of both corporate and national culture. China and Korea are struggling with the issue now, paying the price of a deeply hierarchical business culture. South Africa will experience the same, if the contagion gets much worse, as a result of a heavily controlling management mindset.

When we emerge from the other side, however, it will be to a very different world. It will be one in which digitalisation will be seen as a corporate governance matter. Social responsibility? Tick. Sustainability? Tick. Transparency? Tick. Security compliance? Tick. Regulatory compliance? Tick. Digitalisation? Oops.

In other words, we can expect a boom in digitalisation services, including the embrace of cloud computing, customer service platforms being integrated into business operations, and remote working and training becoming standard options.

Video-conferencing, webinar services, distance education, telemedicine and e-government platforms will thrive. An acceleration of ecommerce will threaten the malls, and home entertainment will thrive as the cinemas empty out.

It won’t be as much fun, but it may well be more profitable.