The COVID-19 pandemic has forced lockdowns across the globe, drastically changing the way we work and live, and resulting in an economic impact, unlike anything we’ve seen since WWII.
Demand drawdown and the shuttering of businesses is causing global economies to shrink. A recent update by the Economist Intelligence Unit (EIU) predicted that in Europe alone figures range from a 2.6% contraction in Russia to a 7% contraction in Italy.
This begs the question: How can businesses successfully overcome this global crisis?
In their COVID-19: Briefing Note, McKinsey & Company points to “the Resilients” — the top 20% of companies that emerged from the last major recession — and defines their success in two words: speed and discipline.
Ultimately, the key differentiator that sets resilient companies apart from the mere survivors is true business agility. Below, we explore the 3 most-relevant ways businesses can increase business agility to face the pandemic-related challenges that still lie ahead.
3 Ways to Boost Business Agility
1. Enable your teams to work remotely, even after lockdowns.
A fast response to sudden market changes is certainly key in times of crisis, especially at the onset. However, the ability to quickly adapt your organization depends largely on factors such as the internal processes that were already in place and the technologies (or lack of) that support your operations.
When the COVID-19 pandemic sparked a nation-wide lockdown in South Africa, multi-chain retailer Cape Union Mart experienced a smooth and quick transition into a work-from-home routine thanks to their foundation technologies. Renée Jain, Enterprise Application Manager, claims that thanks to Zoom and Centric Product Lifecycle Management (PLM), their buying teams were able to go into isolation immediately, with almost no issues. This is also attributed to the fact that these technologies are cloud-based, as opposed to on-premise, making them accessible from anywhere, at any time.
Having the right technologies to support remote working is not only relevant during strict lockdowns, but also in de-escalation stages, as we move into the 2nd and 3rd quarters of 2020. McKinsey & Company highlights the current situation in China as they recover, and how companies have increased flexibility with teleworking for roles that are able to work from home.
Chinese fashion brand MAXRIENY, for instance, claims that most of their employees continue to work from home. Fanny Fan, a manager in the merchandising department, also attributes their remote collaboration success to technology, “Centric PLM greatly supports the normal operation of our business, and product development work has not been interrupted.”
2. Empower decision-making with end-to-end visibility.
Another factor that enables quick response to market challenges is having full end-to-end visibility of the entire supply chain. This enables leaders to better understand which decisions they need to make and the potential consequences — crucial for safeguarding margins, especially in the midst of a crisis.
When countries around the world began going into lockdown, businesses in the retail, fashion, luxury, outdoor, home décor and consumer goods industries needed to re-formulate their product planning. From canceling orders and switching suppliers to redesigning collections, every business was forced to react fast in order to stabilize the supply chain and ensure working capital.
Renée Jain of Cape Union Mart also discussed the importance of having great visibility of the entire supply chain when faced with the pandemic, “it has allowed teams to rapidly decide on which orders to cancel or which products to push out. This has an impact on our potential margins, so it’s vital for us to be able to make these decisions while having a clear view of what that’ll mean for our business.”
Attaining full visibility of the supply chain is another factor that is facilitated by technology. Outdoor brand, KEEN, leverages Centric Outdoor PLM, claiming that they now have better visibility of the quantity, origins, variations and expected delivery times of samples. “That was much harder to put your finger on previously,” says Aaron Hellickson, Product Development Technology Manager at KEEN.
3. Ensure efficiency and maximize time to value
An obvious defense tactic in an economic crisis is to reduce operating costs. In the last major economic recession, the previously-mentioned “Resilients” managed to reduce theirs by 3 times, compared to non-resilients. Many businesses have already resorted to reducing headcount to ease up on operating costs, placing even more pressure on the remaining teams.
This, in turn, creates a stronger need for increasing efficiency (which also leads to cost reduction). Making processes more agile and maximizing time to value is of the essence in times like these, especially when there are cutbacks on resources.
McKinsey & Company highlights the importance of leveraging technology during the current crisis stating that effective teams need “a single digital source of truth across people, content, performance, and process” as well as “automated delivery pipelines, and collaboration tools to enable a remote product development environment.”
Before the outbreak of the pandemic, German fashion brand, MORE & MORE digitally transformed their business to drive efficiency across globally dispersed teams, setting their “one source of truth” foundation with Centric Fashion PLM. This resulted in a faster time to market, a reduction of 40% in sketch to sample time, and increased time to value as all product information became centralized and teams could focus on innovating rather than searching for data.
Can true Business Agility exist without technologies?
The COVID-19 pandemic is becoming a litmus test for businesses, bringing unforeseen challenges that can only be overcome through rapid response and quick adaptation. And, in an era in which mobile phones, laptops, IoT, AI, and other technologies form part of our everyday lives, achieving business agility without key digital innovations is almost impossible.
Leveraging revolutionary cloud-based technologies such as Centric PLM, Quick-start remote collaboration boards, and 3D design integrations is especially imperative in times of crisis. Learn more about how these technologies can get you up in running in days, not months, to empower your teams and meet upcoming market challenges.