Other parts of this series:
It really didn’t feel like anybody had a choice.
One minute companies were thinking about digital disruption in their industry.
Then COVID-19 hit. And the next moment they had moved to digital.
It was not only a fast move, but a smart one as well.
In my last blog post I talked about how this pandemic has been an accelerator of technology adoption and innovation.
Of course, the pandemic isn’t over yet.
Here are some scenarios that we’re thinking about at Accenture.
- Rapid Remission, where the virus is brought under control and fizzles out. Think New Zealand. Or Namibia, which closed their borders after they found their very first case. They aren’t virus-free, but pretty close. That doesn’t look realistic to me. It looks like it’s here to stay, in South Africa at least.
- Or a Flattened Curve, where maybe over the next few months infections will tail off, until getting infected is just another manageable health risk for everybody. This would be good news for businesses because they could start operating again in a pre-pandemic way.
- Cyclical outbreaks. This seems to me the most likely of the scenarios. We will get it under control in some areas and then it will flare up again. We’re already seeing that in other countries.
If COVID-19 really flares up, maybe Government will shut down the country one province at a time.
This would be challenging. For a start, think about the whiplash in the supply chains. Figuring out who should be working and where they should be working from will add a layer of complexity. Demand will be unpredictable and so will revenues and profits. People will be stressed and won’t want to engage. The mental health of everybody will affect morale and productivity. And that’s without the high cost of re-starting.
Companies that are quicker at adapting might easily take revenue away from larger companies. My local supermarket doesn’t have an app, but it does offer same-day delivery.
I email them my list, then a few hours later the person picking my order phones me for clarification or to suggest alternatives to items they don’t have in stock. Later that afternoon a man in a van arrives with a mask and my groceries. They even throw in a free chocolate bar if I spend more than R500, and free delivery for orders over R1,000.
Sure, the big-name retailers have sophisticated apps where I can scan barcodes using my phone, and it will populate my list automatically.
But they also have a 10-day to three-week lag on delivery times, and if there’s a stock outage, the apps are terrible at suggesting alternatives.
So my local supplier is suddenly getting 100% of my grocery spend, even though it almost certainly costs me 2% to 5% more per visit.
This kind of disruption is happening everywhere and it’s been almost immediate.
Accenture has a roadmap for our clients who want to capitalise on the digital future. And my local supermarket offers a great illustration for the Accenture roadmap.
- Our research suggests companies need to be more digital. My local shop might want to build a shopping website or an app.
- Be data driven. I’m guessing 80% of my shopping list is probably quite predictable. My local might benefit from knowing that. Quite frankly, I myself would appreciate knowing that. It might help make my spend more effective and would help with their supplier management.
- Be in the cloud. Why develop all this stuff from scratch when all these problems have already been solved and you can tap into ready-made solutions built by clever people all over the world. (I love my colleague Neil Lister’s take on this — he says the cloud is disrupting businesses like Uber disrupted the taxi industry.)
- Have more variable cost structures. If the online deliveries really take off, they will need more vehicles and drivers. Far better to hire those by the kilometre than spend more than a million rand per vehicle.
- Agile operations and automation. Does my local supermarket need more automation? The ordering process could definitely be automated. If the ordering process was integrated into their inventory management system, a human being wouldn’t have to phone me from the shop floor to tell me they don’t have a 500g packet and suggest two 250g packets instead. And they don’t have smart picking lists either. A bit of automation just to organise the list would make picking more efficient. With the time saving they may be able to pick an extra order or two per day.
It’s interesting to reflect on how the Accenture roadmap can be applied by both a small local operator and our industry-leading or multi-national clients.
These are exciting times for companies that embark early and decisively on their digital journey. I’d love to know what your next steps will be along that journey. You can contact me at email@example.com