The effect of lockdown on most business sectors across the UK was an immediate loss of revenue as sales fell off a cliff. As a result, projects and planned capital expenditure were put on hold with no immediate prospect of being able to make up the loss. A lot of organisations also had the double whammy impact of also needing to organise and equip their workforce for remote working, with requisite unplanned capital expenditure on laptops, monitors, printers, communications and networking. IT departments suddenly were under huge pressures to implement policies allowing people to work from home, along with supporting large numbers of users not previously used to working remotely.
Almost overnight, there was a colossal change in how businesses were run. Shifting to a remote, virtual society, many have had to bring forwards their digitalisation plans to survive. Recent research by McKinsey found that companies have accelerated the digitisation of their customer and supply-chain interactions and of their internal operations by three to four years and plans for implementing digitally enabled products has sped up by as much as seven years.
The impact is varied and felt by many:
Customers: The impact of Covid-19 for customers was a sudden refocusing of their projects and capital flow. With no immediate end in sight to the pandemic and considering the lockdown restrictions that were in place, planned expenditure, projects etc went on the back burner. New priorities were being developed to help cope with the fallout of losing orders or at least seeing orders that were planned for shipping being delayed by weeks or even months.
Supply chain: While organisations where making changes to accommodate the situation, it would be foolish to think those changes could be made in isolation. The economy is such that inter-sector dependencies exist to support each other and so organisations also needed to, communicate with and engage their suppliers in these changes. There was no point in pivoting the business to a new or different sales channel if the business ended up unable to deliver product because the delivery capacity didn’t exist, or the organisation was dependant on a source of raw material that is suddenly in short supply.
Internal: The impact internally was that many organisations who were primarily equipped to house their employees in offices had to pivot very quickly to remote working to allow those same employees to carry out their duties and responsibilities from home. This required (in some cases) un-budgeted expenditure on additional IT equipment, required IT services to provision and setup equipment and facilities management to ship it out wherever it needed to go. This would also have a huge impact on the IT Support function as they would now be dealing with a large number of calls from employees who needed to be supported (at least initially) in getting connected at home and getting used to working remotely.
Short to medium term changes
In order to meet the immediate challenge that lockdown presented, whilst also keeping an eye on how things might work once restrictions were eased, organisations needed to complete several actions. For some companies this might simply be a case of expanding provision as they already had specific policies in place that would assist in this. For other companies who had never faced something like this and for whom working from home was an alien concept this would prove to be a bigger challenge.
For traditional office-based workers, working remotely simply meant that the employee would work from home and carry out their duties in much the same way that they would have done in the office. Applications like Microsoft Skype for Business, Teams, Slack, GoToMeeting, Zoom etc already had a foothold in the more forward thinking organisations while others scrambled to move their users onto these applications platforms at a scale never seen before.
With the drive to work remotely, creating, storing, sharing and protecting data became a high priority issue. How could the organisation ensure that their data is secured appropriately, and also backed up? Vendors like DropBox, Box, AWS Storage saw a huge uptick in both interest and sales as organisations rushed to put in place a storage solution that enabled documents and data to be securely stored in the cloud, which in turn would make it accessible to their employees.
Document and data storage are not the only things to migrate to the cloud though. Organisations also looked to migrate core applications from on-premises to the cloud as having their application in the cloud provided a number of benefits, including;
Physical locations containing only server infrastructure could be shut down to save money
Core applications based in the cloud would always be available backed up by SLA contracts
Management of the core application platform could be outsourced to vendor (OS upgrades, patches, application updates etc)
Ability to host core applications in multiple global data centres (users connect to closest physical data centre, also provides resilience)
Developing a digital strategy
Looking back now at how organisations have coped with the changes that Covid-19 caused, some organisations have dealt with the change better than others. What is more surprising is that some organisations (aside from online retailers) have also managed to maintain a level of growth during this period that seemed impossible at the outset. The organisations that were able to achieve this already had a digital strategy in place and simply took full advantage of their digital capability. Critical business processes (sales, order processing, inventory, supplier management etc) are all centralised into a digital process hub and access granted to customers, suppliers and employees with appropriate access controls and security employed at all levels. Organisations that experienced a significant reduction in growth were more likely to be organisations that had plans to create or increase their digital presence but were simply overtaken by events and the lead times involved in quickly setting something up.
Lastly some organisations have niche markets which don’t lend themselves easily to the kinds of changes being discussed here. For those types of organisations, this does pose the question of how they can effectively deal with the next big storm. What this has shown is that organisations need a robust digital strategy now – not in 3 or 5 years time – in order to create and maintain engagement with employees, suppliers and customers.
Adoption of enabling technologies
Since the start of this pandemic, there have been several key technologies that organisations have either adopted or increased their use of. These technologies include:
MS Teams, Zoom, Cisco WebEx
Provides a platform for employees to participate in virtual meetings as a group or on a one-to-one basis. Can also be used to share applications or desktops to demonstrate a point or in a training course.
Cisco, Vonage, Skype, Teams
Provides a platform that allows employees to communicate over an IP based connection requiring just an internet connection. There is no requirement for an additional telephone line to be installed at the users home.
MS Teams, Discord, Slack, Trello, Jira
Allows a more informal form of communication and information dissemination amongst teams of people (who might be internal and/or external).
Microsoft Office 365, Google G Suite
Office applications like Word, PowerPoint or Google Sheets etc are the core applications that are used to create and modify content. With the move to the cloud, the major providers of the Office Suites have moved to a subscription licensing model which both integrates with their cloud tools and creates a stickier customer experience.
OneDrive, Dropbox, Box, AWS Storage
Provides resilient, encrypted and secured storage of files and data.
Low-code application development platforms
Low-code application platforms provide a means to quickly integrate disparate systems together into a single unified system. They achieve this through the ability to quickly develop forms (for both desktop and mobiles devices), process flows and talk to external systems via well-defined APIs.
Relational data systems
SQL server, Oracle, NoSQL, Hadoop
Processed data needs to live somewhere and as organisations are generating ever increasing amounts of data it makes sense to store this in the cloud as well.
Solutions that provide a platform for automating business processes using “software robots” to carry out tasks that previously would have been done by humans. Task types include transactional tasks, data processing (import, export and augmentation), IT management and automated online helpers.
Long term implications
So, with a second lockdown having recently finished in the UK while some European countries remain in lock down, are there any changes that have been made in the short-term that will become permanent and how do organisations embed resilience?
Analysis of the business environment several months into the Covid-19 pandemic has revealed some interesting data points. The organisations that managed to limit their exposure to the pandemic were able to do so because they had already invested in a digital strategy and were able to utilise and increase their digital footprint as part of their preparation. They were able to promote digital channels for interacting with their customers and/or suppliers which meant sales could continue, products could continue to be shipped and communication lines remained open.
Organisations that lacked a digital strategy or that were at the beginning of their digital journey were not as effective in harnessing digital to engage with their customers and suppliers. This also requires leadership from the top, if that is lacking at any point in the organisation, digital initiatives are likely fail in their delivery. Going digital also requires an investment to be made in digital platforms that will underpin the digital strategy. This investment should not be seen as a one-off investment though, as with all things in technology, things can and do change rapidly and organisations need to stay abreast of the shifts in the market to ensure that their ‘platform’ stays up to date and continues to engage their market.
It’s important to note here also that once an organisation decides to go all into digital, it is easy to sit back and think ‘job done’ – you’ve made the investment and seen positive results. However, the danger with that is that the market might shift, or another event happens that requires a similar scale of change and the opportunity is missed through being complacent. Technology platforms will also improve over time and new products will hit the market that promise to do more with less or that combine the functions of multiple complex products into a single new easier to use product so it’s important not to rest on your laurels.
One of the biggest changes for managers and directors of UK companies is the realisation that having their employees work remotely is not the productivity killer they may have thought it might be. Up until lockdown, remote working was the exception rather than the norm. For a lot of managers, allowing employees to work remotely was viewed with suspicion because if the employee is not in the office, how can their productivity and engagement be tracked? Since lockdown though, employers have had no option but to rollout remote working on an unprecedented scale and the results have not impacted productivity in the way that managers feared. The increased use of and rapid adoption of conferencing platforms, collaboration platforms, email and IM applications have eased those concerns and made it possible for employees to engage face to face (albeit in a virtual capacity) in team meetings and one to one meetings with other people. A knock-on effect of this is trend is that organisations may decided to scale back on their physical footprint, the reason being, if more employees are working remotely, organisations don’t need to maintain large office buildings. The costs associated with those unneeded offices can be removed from the bottom line.
Impact on business continuity
With the increasing use of these enabling technologies, how does that impact an organisations Business Continuity (BC) plan? One of the challenges for organisations is proving that their BC plan works for a variety of scenarios. Organisations should be actively and regularly testing their BC plans. If recent events have shown us anything it, is the need to update and confirm BC plans with an ever changing & dynamic application infrastructure. The key for a successful BC plan is to ensure that organisations cover (at a minimum) the following areas;
Ensuring staff are appropriate equipped for remote working
Phone Service (redirection of primary numbers, transfer calls, divert calls to preferred devices etc)
Emails and calendars are available (Office 365, Google G Suite), can be accessed via the Web and preferred mobile devices
Files and documents are stored securely, encrypted and remain accessible via authorised devices
There may be other core applications that need to be added to this list, but the above list is the bare minimum that should be included.
2020 has been a pivotal year for the World Economy. The impact of Covid-19 has been felt all around the world. Some organisations have weathered the resulting storm through an existing strategy of investing in digital way ahead of the pandemic. This enabled those organisations to respond very quickly and efficiently to the rapid changes that dealing with Covid-19 required. These organisations already had a significant footprint in digital technology that enabled them to keep in touch with their market via email, instant messaging and collaboration tools. These organisations also had already made the move into the cloud which allowed their employees to work from anywhere, not just the office. Organisations that were starting to embrace going digital found themselves in a situation where they had to expedite their strategy changes, increase their investment in digital and begin making the necessary changes to align with the new reality. Some of those organisations are still working through those changes because the skills and experience take time to acquire and build up. The organisations that relied on traditional methods of doing business, for example face to face, bricks and mortar stores experienced the biggest shocks to their business as they had not yet started to invest in digital (or were at the very early stages) and were extremely unprepared for the coming changes brought in by Covid-19.
Whether these organisations are still around in 12months time depends very much on how quickly they can adapt. We have already seen the collapse of some major high street brand names in the past 6 months (although for some of these brand names, the problems had been building long before the pandemic, Covid-19 just moved those problems front and centre), this trend is expected to continue for the foreseeable future as they grapple with realities of working in a post Covid-19 world. The post Covid-19 world demands that future solutions come with a capability (through improved business processes, integrated RPA technology and AI that can intelligently handle with requests with minimal user input) to deal with situations like this as standard so that we aren’t caught out again like we were at the beginning of 2020.