This blog was written by TIBCO Director of Digital Strategy Alessandro Chimera and originally published on the Italian tech website, Solo Tablet.
Not only companies, but also many professionals have to face a challenge, which places a change in habits at the top of the priorities of the actions to be taken. Suddenly, we are asked to travel less, attend fewer meetings, and limit business lunches. At the same time, we are streaming more content, participating in virtual meetings, and using eLearning platforms, as well as taking advantage of home delivery services.
If the current situation and history have taught us anything, it is that when a crisis arises, traditional operating models are no longer valid. Companies need to react quickly and create, validate, and adopt entirely new strategies to keep their business running and generate sufficient margins to overcome the current crisis. It’s not just the travel market that’s impacted: financial services, telecommunications, industry, transportation, retail, healthcare, government, hospitality, and the energy sector are all facing the same challenges in adapting to the new reality.
How to Adapt
If we look at the initiatives that financial services should take, the fastest action available to them is to quickly rebalance all their investment lines with event-driven strategies. On the other hand, the telecommunications sector faces the unexpected increase in connections and a greater data load on its networks, focusing on providing reliable services to an increasing number of people whose only means of connection with their communities, is private and business, it passes through its own network.
Another heavily impacted sector is the manufacturing industry, as orders are falling sharply or being canceled due to customers focusing their primary needs on other sectors. There are significant delays in the supply chain, commodities purchased internationally are delivered late. New procedures are being implemented which, following the pandemic, must guarantee the safety of workers. Some of these companies may also be forced to consider a temporary reduction in their workforce.
The transport sector was the first to suffer direct impact due to flight cancellations, border closures, reassignment of passengers to new flights and flight rescheduling and changes with virtually no notice. The IATA association ( International Air Transport Association ) predicts that on a global level and due to a limited contagion scenario, the current measures will cause a loss of turnover on passenger air traffic equal to approximately 63 billion dollars. While, for an extended contagion scenario, the losses could amount to as much as 113 billion dollars.
Who is Ready
Very few players in these market sectors were ready: in reality, in most cases, they were totally unprepared. Let’s see the consequences of the lockdown in Italy, our country: when this measure was first implemented, it generated a 56.8% increase in eCommerce, mobile traffic doubled and systems had to be upgraded to withstand the loads additional to which they were subjected.
In manufacturing, many large manufacturers have begun to optimize their processes and operations, analyzing their data to understand how to cope with the new situation they have found themselves in. A particularly true statement for industrial food processing plants, which have seen a notable growth in demand, due to the fact that Italians were forced to stay at home. On the other hand, retailers and distributors saw a 12.2% growth in sales resulting from the new demand.
The services on-demand media and entertainment streaming have also begun to suffer additional load: sudden growth of customers with the most extensive mode of use that has dealt a blow providers, bringing close to saturation their networks. For example, Netflix and YouTube have accepted the European Union’s request to take action to avoid saturating the available bandwidth by lowering the definition quality.
But not everyone has seen demand grow: the entire hospitality market has had to stop abruptly. Major events have been canceled or postponed, corporate travel restrictions have caused hotels to empty, and major hotel chains are canceling cancellation fees for current and upcoming bookings to at least secure future business and avoid losing potential customers.
We often talk about the evolution of business and business transformation and how it must happen quickly. However, no one could have imagined the speed with which the pandemic hit the world. At the time of writing this article, only a few countries had decided to close all non-essential activities (lockdown). Today, however, all countries have decided to implement the lockdown, and some (including Italy) have already exited or are exiting the so-called Phase 1 of tight lockdown.
Unfortunately, many companies have never invested in the tools they need to analyze their business data deeper and, without valid supporting analysis, it is not possible for them to make correct strategic choices to decide whether the new processes or business models they want implement can really work.
The spotlight is therefore on all companies to act quickly to integrate and unify the various data sources and extract their potential value thanks to Advanced Analytics tools to apply Machine Learning or AI on their data, so that they can explore new sales channels. and seize new revenue opportunities.
It is a lesson to understand and adapt your business strategies to what customers really want, monitoring their behavior to understand how quickly you can adapt your business to new customer requests. If the term reinvention was ever relevant, it certainly happens today, in the business climate we live in. The key is to understand that decision-making processes must be supported by analyzing your own data, which provides the know-how on how to optimize your execution models to make the alternative business models you are exploring work.Companies need to react quickly and create, validate, and adopt entirely new strategies to keep their business running and generate sufficient margins to adapt to the new reality. Click To Tweet
Failure is not contemplated. Strategies must be tested quickly and digitally to predict the outcome. Last but not least, you need to be closer to your customers. Understanding that their purchasing power has shifted online, that they are more selective, more frugal and insightful, and that this customer intimacy called customer intimacy is today a primarily digital concept. If you get this mix right and when the world returns to the new normal, their loyalty will make them return as your customers more than ever.
Visit tibco.com to see how we can help you begin your digital transformation today.