Good afternoon everyone! I would like to thank you for taking the time to join us today to discuss the Impetus for Change and its implications on Corporate and Organization Development.
Today, I would like to talk about 4 items:
First: The Short-Term Business Impact of COVID-19,
Second: The Long-Term Innovation Trends Affecting Business Even Before the Pandemic,
Third: The implications of Short-Term and Long-Term Trends on Business and Jobs, and
Fourth: The Way Forward: How We Can Leverage These Trends as Impetus for Change.
The Impact of COVID-19 and Technological Disruption
While the COVID-19 Pandemic has caused massive disruption in how we create and deliver value, it is wrong to assume that all change was caused by the pandemic. Yes, COVID has disrupted supply and distribution chains as well as how we travel and engage clients.
The more appropriate way to look at it is that COVID simply increased the pace of change of what was already there.
Successful Enterprises must think across two timelines
We believe that Successful Enterprises are able to navigate the short-term and long-term simultaneously.
In the Short-Term
The ability to adapt in the short-term in response to the pandemic, while simultaneously laying the foundation for future success is critical for enterprise survival. Companies must address immediate challenges and resolve resiliency issues. That is Job 1.
In the Long-Term
Companies must take a long and hard look at their Vision. Is it still relevant given the changes happening all around us? If yes, we must ask ourselves: What needs to adjust in terms of our Business and Human Capital Strategy? The latter being tied-to, and a prerequisite to execute the former.
Re-imagination of How Organizations Create Value
Answering the questions brought about by the pandemic and long-term innovation may lead to completely new value propositions and ultimately, new business models.
Addressing Short-Term Shocks: COVID-19
COVID is the biggest disruptor in our lifetime, and will be remembered for its massive impact on global economy and our lives. From crashing economic activity to changes in the way we interact with one another, live, work, and consume, our lives have been upended.
The Asymmetric Nature of COVID-19
COVID-19 has impacted our businesses and lives in unprecedented ways. There is simply no comparison with other recessions such as 2008 and the Asian Financial Crisis. From shifting demand and supply to challenges to how we move products, information, and finances, there are simultaneous pressures affecting the organization.
The Challenge for CEO’s and Senior Executives
CEOs and senior executives find themselves having to initiate organization transformation at a time when revenues are down — sometimes by 70-80% — while access to capital are restricted. Sure, the Government has some programs in place to help businesses, particularly SME’s, but it too has challenges in how to execute these initiatives. Many executives could end up feeling alone and trapped.
With so many questions in the minds of senior executives, the natural tendency is to simply wait it out. To “hope” that everything returns to our pre-pandemic life.
What if COVID is here to stay?
The biggest question facing us — and these are being confirmed by initial studies – is that what if COVID is here to stay? It will be endemic to all of us. Senior Executives and Businesses must learn to live with it.
We hope, it gets to a point where vaccine development and effectiveness outpaces the virus mutation. We hope that getting a COVID-19 vaccine will be as simple as an annual flu shot. Or as some pharmaceuticals are working on, to make COVID vaccines as simple as taking it at home.
Be Cognizant of Long-Term Trends
Innovation Cycles
The long-term innovation cycles have always placed pressure on businesses.
Looking at history, innovation cycles come in 6 waves. From water power, to steam engines, to aviation, to Artificial Intelligence, each wave being shorter and shorter.
Due to the fast-paced nature of innovation, the average lifespan of business has likewise dropped significantly.
Value Chains, Business Models, and Organization structures are changing.
To stay relevant, organizations must continually adapt.
The “forced” adaptations are a direct result of external pressures coming from all sides. While we create value, we must adapt. Successful organizations can simultaneously create value while adapting to their external surroundings.
Planned Business adaptation in response to COVID.
Based on a research study conducted by The World Economic Forum, the top business responses to COVID-19 induced changes are centered around digitalization, remote work, automation of tasks, reskilling and organization transformation and/or restructuring.
Technologies likely to be adopted by 2025
In the same World Economic Forum study, technologies such as cloud-computing, Data Analytics, Internet of things… even cyber security as organizations are forced to do business online… are the primary technologies successful organizations must adopt.
Implications of Short-Term Shocks and Long-Term trends
Estimated Share of Workers at Risk
What all these means is that many jobs will be at risk. Depending on what industry you are operating from, the risk of job loss could be more pronounced.
Barriers to technological adoption
The World Economic Forum study found that the largest barrier to technological adoption is skill gaps, inability to find the right talent, and even skill gaps in terms of organizational leadership.
Growing demand for key skills by 2025
Questions being raised by our clients, particularly by those in leadership positions are “how do you manage a remote workforce? How do you ensure that people are working for the full 8 hours? How do we manage mental health and stress-levels to avoid burnout? Etc.
The skill groups with growing demand by 2025 are those that cut across functions. These “soft” skills are the essential skills moving forward, on top of, the functional skills.
4 Implications of Short-term Shocks and Long-Term trends
#1 Successful Organizations know they need to adopt new technologies but skill gaps and the inability to hire the right people, to place the right people in the right jobs are major barriers.
#2 Learning curricula, both within Business organizations and the Academe, must evolve utilizing the latest technologies and approaches. This is where we see the rise of “self-paced” learning, micro-learning and other trends come into play.
#3 Business survival is dependent on the rate of transformation. It is no longer a question if we need to evolve our business models and value creation processes. The real question is ‘how fast should an organization adapt?’. It is all about speed.
#4 The need to reskill and upskill is just becoming more and more urgent. Successful organizations know that they cannot get out of this crisis with the same set of skills they had coming in.
It takes a shift in mindset. Think about reskilling and upskilling as an Investment NOT an Expense!
So, what can we do to move forward in a highly uncertain business environment?
I know what you are thinking: “That sounds great, JC. But how do we do this?”
Well, my answer would be to take a futurist view towards strategic planning.
First, for the next 12 – 24 months, think tactical. We all have just one goal in the next
1 -2 years: SURVIVE.
Once you have addressed the cash management and resiliency issues; once you have stabilized your organization; then the time to think strategically comes into play.
Begin setting the foundation for a new strategy — one that helps you achieve your refined and/or reaffirmed Vision.
Over the longer term, say 10 years or more, you should have achieved a systems-level evolution.
So that’s about it. I thank you again for joining us and look forward to answering any questions you may have in the open forum.
Thank you.
