This article was originally published on Entreprener.com, and authored by Elango. R, President – Hi-Tech SBU
Here's how your business can survive and thrive in 2020
This will go down as the year when a zoonotic disease led to a philosophical rehaul of what it means to thrive. The pandemic and the ensuing restrictions on people and movement have compelled business leaders to hit the ground running with new plans on how to operate during and after the crisis
But this is "normal." All crises invoke a fundamental fight-or-flight impulse — a primeval reaction that is also mirrored by businesses. While some of us in the ecosystem responded with elan, others struggled to get a grip.
Taking a page from the history books
Now, six months into the pandemic, we have gone past the “react” phase. With the adrenalin rush subsiding, is there more for us to reap from this crisis? History has a way of teaching us lessons and I want to find a story from the past we hadn’t heard.
The Spanish Flu of 1918, which the current pandemic is often compared to. was far worse in terms of the number of people it infected — 500 million worldwide — and in the number of deaths it caused — 50 million. Although short-lived, its effect on the economy was felt by businesses in the entertainment and service sectors, which reported revenue losses in double digits.
A curious exception, the oldest continuously owned bike shop in the US, Bellitte Bicycles was set up in New York when the Spanish Flu claimed 30,000 lives in the city. Later, the family-owned bikes, repairs, and sales shop went on to make it through major international events including the Great Depression, the Second World War, and the 9/11 attacks. Reading their story is fascinating.
For those of you who don’t have to time to browse in it fully, here’s the quick tour. Bellitte Bicycles started with motorcycles, transitioned to bikes during the Great Depression, and rode through shortages in World II led by ingenious, second-generation entrepreneurs. In fact, it is still going strong after 100 years, doing roaring business through another pandemic.
Three lessons that enable companies to thrive in a crisis
What is it that makes a small, almost obscure company like this succeed so wildly through many years? A couple of things.
Focus on stakeholders. First, an expansive focus that both considers shareholders and broadens the scope to include stakeholders. What is the difference you may wonder? A shareholder approach focuses only on preserving shareholder wealth, which is the stock price. This essentially entails a short-term view that allows for ‘slash and burn.' A stakeholder approach on the other hand considers customers, employees, partners, communities, and families as entities that matter equally.
Respond with speed. The second-best practice is the ability to respond with speed. This reminds me of how a fine dining restaurant in Seattle reacted to the pandemic. Canlis is one of Seattle’s signature fine-dining restaurants. Since March this year, the 70-year-old award-winning dining icon has switched to offering diners customizable and affordable menu options. This includes a convenient and affordable home delivery service of ‘family meals’ with zero contact, which protects its employees while ensuring that staff, including servers, continue to hold down jobs by becoming part of the restaurant’s delivery staff. To me, this is a fine example of a firm responding imaginatively and mindfully to a crisis.
Move from respond to reshape fast. In the Bellitte story, there is a reference to how they made the shift from motorcycles to bikes when the roaring 20s turned into the Depression-era and kept making those pivots with each crisis. This is important. The willingness and foresight to reshape are where resilience kicks in. Going back to the Bellitte story or even the Y2K story for technology companies, robust enterprises have reshaped their future by using crises as burning platforms.
Utilize this crisis as a growth opportunity
Even more inspiring shifts in business models can be seen in the logistics space. Companies that have so far provided fleets for essential businesses are reshaping themselves to offer vehicles for last-mile connectivity. Large shipping companies are re-looking at how they treat inventory.
So, don’t waste time. Make the most of the opportunities the crisis has presented. Whether it is product portfolio rationalization, technology transformation, or divestitures to monetize assets like infrastructure — for the discerning, there are many opportunities. But it is crucial to find the right partner and move quickly.