Business and technology are expected to be permanently impacted by the pandemic, according to a report titled, “The New, Unstable Normal: How COVID-19 will Change Business and Technology Forever,” just released by research and advisory firm Forrester. The report indicates that five macro shifts will emerge over the next decade directly as a result of changes now underway associated with COVID 19. These changes are threading through the areas of customers’ expectations, digital experiences, work, technology, and business resiliency that will have short-, medium-, and long-term impact.
Stephanie Balaouras, VP and Group Director at Forrester, explains the pandemic’s ongoing and forceful impact, stating, “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.”
- In the near term consumers will balance safety and convenience in their purchasing decisions, but it will vary depending upon region, age and culture. For example, though online ecommerce has already increased significantly to adapt to social distancing, by country its use has been quite different. While 60% of metropolitan Chinese online adults indicated they are buying more online, this compares to 35% of US and UK online adults that still prefer in-store purchases despite the pandemic. But as we move forward Forester sees financial strain and lack of in-person group interaction wearing on people, resulting in a lack of meaning and purpose. One outcome is that consumers will seek more trusted brands that connect them to a greater cause that in the long term will lead to consumers bonding to brands that they believe in and which will give them the greatest control over their buying experiences.
- Due to the greater and widespread use of digital, businesses are adapting by offering hybrid experiences to the consumer. Individuals moving into digital who are more values-based are expected to put greater focus on the ethics of brands, prompting businesses to respond with new design practices that “blend emotion and insights”. In the medium term emphasis will be on good design and user experience practices and defined outcomes offered to consumers, not just simply products. Over the long term businesses that gain consumer cooperation in providing data will be in the better position to offer “anticipatory experiences that predict their shopping, financial, and entertainment needs” that will give them a greater competitive advantage.
- Businesses and governments are now embracing the future of work, something they lagged in doing. The pandemic showed that remote work productivity generally held steady or improved, prompting some to shift entire workforces to it. In the immediate period the firms that forged people and technology together using for example AI and automation created more engaged workforces that enhanced their competitiveness over those who did not. While moving into the medium term, the embracing of remote working will boost economic regions around the world, but it will result in about a quarter of their city-center office space to be shed that in the long term will require a repurposing of use.
- The emerging disruptive digital wave will take with it those firms who move away from prior technology more quickly to achieve new robust platform systems, per the pandemic, that will yield digital outputs seen as critical for business models to adapt. In the medium term more transparent and flexible supply chains will be sought, causing a restructuring of processes such as procurement and logistics that will include the use of blockchain/distributed ledger technology. Further down the road technological innovations like electrification and automation will impact society in transportation, living locations, and the production and use of energy.
- Overall to the pandemic, business resiliency has emerged as a competitive advantage. To insure the delivery of their brand promises, organizations are investing more in business continuity capabilities such as crisis management, while also doing more testing for future common risk scenarios such as a pandemic, but others as well. From this new focus corporate social responsibility, sustainability, and climate risk will become key factors in managing overall business supply chains and creating related strategies. In the long term there will be greater and ongoing commitment to invest in enterprise risk management capabilities, so leaders are able to see risk more quickly that in turn enables them to respond to risk in real time.
In summary, both consumers and businesses have been impacted by COVID-19, each independently adapting in their own ways to survive. But also they are making changes relative to each other that are expected to result in new trends that will emerge over the coming decade that Forrester has laid out.
