Musings from the eye of the storm: Learning from the past disruptions
The main focus of Enterprises during Covid was to manoeuvre through the storm with minimal impact and to emerge stronger on the other side, when the situation stabilizes.
As a first step, business continuity had to be restored. Enterprises adapted to the need of the hour by leveraging collaboration technologies and virtual work environment (VWE). Most people from traditional world have shifted to collaboration platforms like Microsoft Teams, Slack, Zoom etc., While these may seem like tactical and near-term responses at first sight, these new ways of working are here to stay.
This is the beginning of a structural change across industries. Covid has triggered a slew of irreversible business disruptions.
When we look back after a few years, we would notice 2020 as the beginning of these structural changes. In most instances we only realize the impact of such drastic changes after the brands or business models are well established — the rise of Amazon, Google, Uber, Netflix, Airbnb etc. are great examples.
Challenge the status-quo: Amazon out-innovated the competition by digitizing retail and moving it online. They along with eBay kicked off the e-commerce revolution by challenging the brick & mortar retail industry and transformed the entire retail experience.
Eliminate inefficiency: Airbnb kicked off a sharing economy revolution through a new model that leverages spare capacity in homes or vacation property by leasing it out to visitors. On one-hand they helped property owners to monetize idle capacity earning them more income, while reducing the rental costs for the travellers. Airbnb is now larger than the top 3 Hospitality companies in the world combined.
These companies leveraged the crisis to their advantage, re-invented their industry and rose to the top. Amazon, Google shifted gears post dot com crisis. Uber, Netflix and Airbnb started their disruption journey around sub-prime crisis. All these players redefined their industries through disruptions and unseated the market leaders in their respective fields. Let us see how they emerged stronger from the downturns.
Focus on Customer Experience: Uber made the customer experience extremely simple, easier and enabled ‘taxi-at-a-click’. They eliminated long wait times and uncertainties by enabling hassle-free, fast rides with affordable pricing, significantly improving the customer experience.
Re-imagined business models: Netflix disrupted the entertainment industry by streaming videos to your home or a device of your choice and combined that with a subscription model. They shifted the industry from a traditional video rental to an ‘Any show, Anywhere’ . They leveraged the long-tail list of movie titles, along with recommendation engine to revolutionize the entertainment industry.
If we look at the pattern, while all of them use state-of-art technologies, they disrupted their industries through a platform business model
Technology does not disrupt industries, business models do.
In summary, every crisis presents an opportunity, there will be winners and losers. But the leaders that out innovated the industry, that are prepared to re-imagine their business models and those that stayed invested in their employees and customers are most likely to emerge stronger and be successful in the long run.