An economic downturn can often spur businesses to greater heights. When an economic downturn is hitting the global economy, long-term success is predicated on enterprise leaders’ capabilities to see through the crisis of economic downturn and seize the growth opportunities.
Amidst gloomy economic downturn due to the coronavirus pandemic, most businesses take a defensive rather than offensive posture in their effort to mitigate potential losses and stay afloat. They contract their operations and slash costs. They also cut spending on core and essential services like advertising and marketing, engage in massive lay-offs, and reduce output.
According to MIT Sloan Management Review study, about 460 global executives were surveyed on how the Covid-19 affects their business organizations in the short and long terms. Up to 68% of interviewed executives said their key business projects have been scrapped or delayed in the next 6 months and 40% said the impacts will last beyond 6 more months. And 64% and 50% of the executives have been worried about revenue loss and cashflow difficulties in next 6 months respectively. A significant minority of executives have been concerned about damage to organizational culture and existing core capabilities among enterprises.
Every economic downturn poses opportunities for every business. Businesses should view recessions not through a lens of panic, but a lens of opportunity. There are three main levers for potential growth opportunities amid economic downturn – leveraging the powerfulness of digital transformation and technologies, exemplary Customer Experience, and fostering strategic innovation to help businesses seize new opportunities and move forward.
1) Harnessing digital technologies to rise above economic downturn
Confronting the economic downturn amid the Covid-19, digital transformation and technologies namely cloud technology, Internet of Things (IoT), and Big Data, Geo-targeting help businesses turn data into instant insights, thereby optimizing processes, streamlining business operations and reducing operational costs.
For instance, investment in cloud technology is good for large enterprises with complicated businesses as it can help fosters innovation, responsiveness and agile transformation. It accelerates the way companies create new products/services, and new business models. It also helps organizations serve their customers better through data mining and data-driven analysis.
While other companies are cutting costs haphazardly, businesses can use today’s digital technologies as a strategic investment in growth. With the technologies, companies are empowered to come out of the economic gloom poised to lead the pack.
2) Fostering exemplary Customer Experience to weather economic downturn
Customer Experience (CX) matters more during the economic downturn. A clear understanding of the changing needs and expectations of customers is more important than ever before. Give customers a great experience, and they will be loyal and engage with your brand as well as share their immersive experience with friends. However, many customers seem disappointed as companies tout the latest technology or snappy design and they have not focused on or invested in the most meaningful aspects of CX.
Human touch creates exemplary CX and User Experiences (UX). Embracing customers-focused culture is a top priority among your business and that involves running loyalty or customer incentive programs, adapting your products and services to be more suited to your customers’ genuine needs, diversifying your business to minimize damage from the loss of significant customers.
Above all, consumers are intending to permanently shift to online shopping and an increase in overall e-commerce penetration in the aftermath of COVID-19. They are increasingly relying on third-party validation such as online reviews or peer feedback rather than traditional advertising messages. Your business can convert customers to brand advocates via delivering exceptional CX at every interaction opportunity and providing a personalized touch across all channels in their journey.
3) Strategic innovation helps businesses unlock a new source of growth
During the economic downturn, innovation remains a critical lever for organizations to achieve their long-term strategic objectives. When the economy tumbles, enterprises must approach innovation in a strategic and thoughtful way.
Innovation is a driver for rapid and profitable revenue growth and is recognized as being integral to sustaining the long-term future of businesses. Businesses can apply innovation to transform the business models that define the way they operate business.
Companies, for instance, can innovate and commercialize new value propositions for their customers that provide complete solutions where they have provided a single product or service in the past. Also, companies can deliver their products and services in new ways, such as Software as a Service (SaaS) and omnichannel retail experiences for customers. Enterprises can concentrate on a greater proportion of breakthrough innovations, and develop a broader range of business model. These business model innovations help provide a powerful source of growth amid the Covid-19 crisis.
In conclusion, leveraging digital technologies and exemplary Customer Experience and fostering innovation among businesses are regarded as competitive necessities to outpace rivals and seize new growth opportunities. Your business is empowered to weather the gloomy economic downturn and uncover lucrative ways to gain a competitive edge.
Book a consultation on how our digital transformation solutions and technologies help your business unlock new source of growth.